Setting Business Unit Goals Essay Example

goals of different business units in an organization should be compatible so that it does not result in conflict among business units that can be detrimental to the long term corporate level goals. Horizontal consistency of goals (among business units) is as important as vertical consistency (between business unit goals and corporate level ones).

The business unit goals should be established such that each business unit is prompted to compete within its industry for customers. Strategic decisions at the business unit level are concerned about product line extension, brand extension and product line depth. At business unit level it is decided whether to add a new flavor to the existing product or conduct a new product development to expand the market share. It is also about the extent of research and development, equipment and facilities and amount of advertising (Daft, 2007).The business unit goals should be set in a way that they motivate employees and managers to action and this is possible when these goals are compatible with their values. If managers and employees are more concerned and inclined towards quality than quantity then business unit goals should be set which emphasizes achievement of desired quality levels.

Goals are considered as standards against which manager’s and employee’s performance are evaluated and financial and non financial rewards are given. Hence the goals are used as motivational tool for prompting higher performance and productivity levels from employees and it also makes them understand the importance of goals as the basis for successful strategy implementation (Sanders, 1998).In conclusion, the setting of business unit goals should be participatory activity which ensures open communication among employees and also results in commitment to

the goals stated. Business unit goals should be supported by policies which help in solving day to day problems and guiding day to day activities. Correct policies and functional level goals leads to achievement of business unit goals which subsequently ensures implementation of corporate strategy (David, 2009).