Organisational objectives 3 On completing this chapter you should be able to: Know and understand

Conflicts between corporate objectives
Con
fl
icts between objectives can often occur. These con
fl
icts will need to be resolved by 
senior managers and decisions taken on the most signi
fi
cant objective for the next time 
period. The most common con
fl
icts that can occur are:
• growth versus pro
fi
t – achieving higher sales by raising promotional expenditure and 
by reducing prices will be likely to reduce short-term pro
fi
ts
• short term versus long term – lower pro
fi
ts and cash 
fl
ow may need to be accepted 
in the short term if managers decide to invest heavily in new technology or the 
development of new products that might lead to higher pro
fi
ts in the longer term
• stakeholder con
fl
icts – these are covered in detail in 
Chapter 1.4
.
ACTIVITY 1.3.6
IS STS PLC SUCCESSFUL?
STS plc collects waste from houses, offices and factories. Most of the waste is burned 
to produce heat and electricity for the company’s own use. This saves costs and 
reduces the impact on the environment by not using areas of land to bury the rubbish. 
A
recent increase in customers has meant that not all of the waste can be burned and 

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Organisational objectives
51
Factors determining corporate objectives
There are several reasons why 
fi
rms have di
ff
erent objectives.
Corporate culture
This can be de
fi
ned as the code of behaviour and attitudes that in
fl
uences the decision-
making style of the managers and other employees of the business. Culture is a way of 
doing things that is shared by all those in the organisation. 
If directors are aggressive in pursuit of their aims, keen to take over rival businesses and 
care little about social or environmental factors, then the objectives of the business will 
be very di
ff
erent from those of a business owned and controlled by directors with a more 
‘people’- or ‘social’- orientated culture.