It includes what is the reason for the existence of the business or” why” the company is established what are the objectives behind it

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it includes what is the reason for the existence of the business or” why” the company is established what are the objectives behind it.

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LectureNotes said it includes what is the reason for the existence of the business or “why” the company is established and what are the objectives behind it

Answer:
The reasons for the existence of a business, often encapsulated by its “why” or mission statement, and the objectives behind its establishment are critical aspects that define its purpose, guide its activities, and influence its strategies. Here’s a detailed explanation of what these concepts generally entail:

  1. Reason for Existence (Mission Statement):

    • Purpose and Vision: The core reason for the existence of a business is often articulated in its mission statement. This statement describes the overarching goals and the primary purpose that the business serves in the market and society. For example, a company might exist to provide innovative technology solutions to improve everyday life or to offer sustainable products that benefit the environment.

      • Example: Apple Inc.'s mission statement is “to bring the best user experience to its customers through its innovative hardware, software, and services.”

  2. Why the Company is Established:

    • Founding Principles: Companies are often established to address specific needs or gaps in the market. This can be related to the founders’ vision, passion, or expertise. The “why” can also relate to a company’s desire to innovate, solve problems, fulfill a passion, or respond to societal needs.

      • Example: Tesla, Inc. was established with the vision to accelerate the world’s transition to sustainable energy by making electric vehicles more accessible and desirable.

  3. Objectives Behind the Company:

    • Strategic Goals: These are precise targets that a company aims to achieve within specific timeframes. Objectives can be financial, such as achieving a certain revenue goal; operational, like improving efficiency; or customer-related, such as enhancing customer satisfaction.

      • Short-term Objectives: These might include launching a new product line, entering a new market, or increasing market share within a year.

      • Long-term Objectives: These often focus on sustained growth, like becoming a market leader in the industry within the next decade or expanding globally.

      • Example: Amazon’s objective to become the world’s most customer-centric company by providing everything customers need with utmost convenience.

  4. Impact and Social Responsibility:

    • Corporate Social Responsibility (CSR): Many businesses today also include social and environmental objectives as part of their foundational goals. This might involve community engagement, sustainability initiatives, and ethical business practices.

      • Example: Patagonia, Inc. is known for its commitment to the environment and its mission statement to “build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”

In summary, a company’s mission, foundational reason for existence, specific objectives, and impact goals all create a comprehensive framework that guides its operation, strategy, and growth. Understanding these aspects helps clarify what drives a company and how it plans to achieve its goals while contributing positively to society.