Objectives are the ends for the achievement of which managerial activities are directed.
These are the pre-requisites of planning. It constitutes the purpose, the attainment of which is necessary for the business. These are the standing plans of the business. These are not only helpful in planning but also in other managerial functions like organizing, directing and controlling. Clear cut objective helps in proper decision making and in achieving better results.
ACCORDING TO MC FARLAND
“Objectives are the goals, aims or purposes that the organization wishes to achieve over varying period of time.”
ACCORDING TO GEORGE R TERRY
“A managerial objective is the intended goal which prescribes definite scope and suggests direction to efforts of a manager.”
ACCORDING TO KOONTZ AND O’DONNELL
“Objective is a term commonly used to indicate the endpoint of a managerial programme.”
In simple words, objective may be defined as expectations of end results for which an organization is established and which it tries to achieve.
EXAMPLE: Increase in sale by 10% in six months or decrease in cost by 2% in month is the objective.
FEATURES OF OBJECTIVES
- ARRANGED IN HIERARCHY
Objective can be arranged in the hierarchy. These form the range from the organizational objective to specific individual objective. The hierarchy can be like this:
- Firstly there are corporate objective fixed by the top level management.
- Next there come the departmental or divisional objective.
- Then there are sectional objective that are very specific and set for each section separately.
- Then comes the specific individual objective.
- MULTIPLE IN NATURE
Objectives are multiple. There cannot be a single objective for the whole organization. Number of goals is set up to achieve the main target set by the top management. To attain the primary objective, many secondary goals are made.
Example: Suppose a car manufacturing company has the main aim of achieving economy in the car manufacturing. The company also will have the secondary objectives regarding spares marketing, financing the purchase of vehicles for different income groups etc.
- INTER-DEPENDENT AND INTER-RELATED
The achievement of main objective will require achievement of subordinate goals also. The non-achievement of small goals may result in non-achievement of main objectives. This shows that the goals are inter-related and inter-dependent.
Example: An agro based company may aim at manufacturing fertilizers, procurement and supply of quality of seeds and marketing and cold storage of agricultural produce. All these objectives are inter-dependent or inter-related.
- TANGIBLE AS WELL AS INTANGIBLE
The objective may be tangible or intangible. Intangible objectives are those objectives which cannot be measured in monetary or quantitative terms. These may relate to performance of manager, morale of workers, social responsibility or integrity and honesty of employees.
Tangible objectives are those which can be measured in quantitative or money terms. These objectives may relate to productivity, market portion and financial resources, return on capital or investment.
- DIFFERENT PRIORITIES AT DIFFERENT TIMES
Success of a business always depends on the rational approach to objectives and determination of priorities. Sometimes the primary objective of the organization is set aside and secondary objectives are considered to be achieved at first. This is because of the changing business environment and there arises the need of the hour to focus on short term goals.
- HAVE A TIME DIMENSION
Objectives are set to achieve in a definite span of time. An objective set without prescribing its time limit to achieve is of no meaning. So an objective to be good one must have a time dimension.
Example: A company set the target of producing 250 fans which is a meaningless target. The target of producing 250 fans in a week is a meaningless target.
- IMPORTANT MEANS OF CONTROL
Objective is pre-requisites of planning. The laid down targets helps in controlling the performance of the employees at a wider scale. The standard targets are compared with the actual performance. This can be made possible only by setting the objectives or targets or goals in advance.
TYPES OF OBJECTIVES
The following are the various types of objectives:
- PRIMARY OBJECTIVE
Primary objectives are the main objectives of the organization. These objectives are set through corporate planning. The secondary objectives are made to achieve the primary objectives. These are related to the company not to the individuals. These are formulated by the top management.
Example: Producing and selling the products to earn profits is the primary objective.
- SECONDARY OBJECTIVE
Secondary objectives are those which are made to achieve and support the attainment of primary objectives. These are also of impersonal nature i.e. belongs to company not to the individuals. These are set up the top management as well as middle management.
Example: Introduction of new product line to increase sales is a secondary objective. This may support the primary objective of increasing profits.
- INDIVIDUAL OBJECTIVE
These are the goals that the individual members of the organization try to achieve. These are achievable as subordinate to primary and secondary objectives. These may be achieved on weekly, monthly or yearly basis. Individuals use their effort, skills and time to achieve these and generally these are economic, psychological and non-financial rewards.
- SOCIAL OBJECTIVES
These are the goals of the organization towards the society. Social responsibility is mandatory in present times. These include the obligations required by the community, government agencies etc. these also include goals intended to further social, physical and cultural improvement of the society.