Other writers however argue that both quantifiable and non-quantifiable
objectives can be set. They would argue that some important objectives such
as technology leadership might be impossible to quantify (Johnson and
Scholes, 1999). Obviously with specific objectives it is easier for an organisa-
tion to gauge whether those objectives have been achieved. However a less
specific objective, such as technology leadership, can still be assessed by
comparing the organisation with the performance of competitors’.
There are dangers though if all objectives are couched in such qualita-
tive terms in that it becomes difficult to know whether they have been
achieved or not.
Whichever perspective is taken on this matter successful objectives also
need to demonstrate the following characteristics:
● Acceptability: Internal managers are more likely to wholeheartedly
support objectives that are in line with their own inclinations. As with
the mission statement some of the organisations long-term objectives
are drawn up to be acceptable to groups external to the organisation.
● Flexibility: Objectives have to be flexible enough to be adaptable when
discontinuities in the external environment occur (see Chapter 6). Here
again is the issue of a trade-off between flexible and SMART objectives.
● Comprehensibility: Managers and staff at all levels have to understand
what is to be achieved and know the main criteria by which their
performance will be judged.
Peter Drucker (1954) suggests that there are a number of key areas within
which organisations should develop objectives:
● Market standing: This relates to the organisation’s success in the mar-
ket. Objectives can be a statement of the total sales or the market share
the organisation seeks.
● Innovation: Targets can be set for innovation in: product and service
development, cost reduction, financing, operational performance,
human resources and management information.
● Productivity: Objectives can be set for of the productive use of resources.
A common approach is to state the number of items produced or the
number of services performed per unit of input. Sometimes productiv-
ity can be stated in terms of decreasing inputs whilst retaining the same
outputs. For example an objective could be to decrease overtime while
at the same time maintaining production levels.
● Physical and financial resources: An organisation can state objectives
about the acquisition and use of resources.
● Profitability: A range of targets can be established for financial returns
including earnings per share or return on equity.
● Manager performance and development: Objectives can be framed to set
performance criteria for managers.
● Employee performance and attitude: Specific performance criteria can be
set against which actual achievements can be measured. Objectives
relating to aspects of employee relations are seen as beneficial in gain-
ing employee’s loyalty.
Strategic intent 141