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BUSINESS DEFINITIONS OF HINDUSTAN LEVER, HERO HONDA, KODAK INDIA AND HERO CYCLES
MISSION STATEMENT
A Mission StatementEmbodies the business philosophy of a companys decision makers Implies the image the company wishes to project for itself Reflects the companys self-concept Indicates the companys principal product or service areas Includes the customer needs the company seeks to satisfy
Focuses on
It should answer questions pertaining to companys Philosophy Self-concept Products or services Markets Technology Concern for survival, growth and profitability Customers Concern for employees Concern for public image
DELL COMPUTER
To be the most successful computer company in the world at delivering the best customer experience in markets we serve.
Staffs unawareness
CORPORATE PHILOSOPHY
The corporate philosophy envisages the basic beliefs, values, aspirations and philosophical priorities of a company which the management or strategic decision makers are committed to. Corporate objectives are
Focused; Specific; and, Usually quantitative.
OBJECTIVE SETTING
Objectives should be Clear and, not expressed in vague or general terms Precise and exact and, should be measurable as far as possible Consistent with organizational mission Logical and realistic rather than idealistic Reflecting of all the major areas of company performance and responsibility Based on strength and weakness analysis of the company to make them achievable Yielding specific results when fulfilled Reviewed periodically and should be reset in the context of changed circumstances
We shall try to improve our position in the market during the next few years We shall always endeavour to increase productivity Our objective is to satisfy customers as far as possible
STRATEGIC INTENT
If a particular objective of a company becomes extremely focused and directed towards a specific target, the company is showing a strategic intent. Strategic intent of a company is clear about the end or the target, but, it is flexible with regard to the means and leaves room for creativity and improvisation.
COMPANY RESPONSIBILITY
Responsibilities are towards various stakeholders and the society at large. Sometimes, profit objective may lead to the neglect of corporate governance and responsibilities. Examples are: Exxons oil leak in Alaska ; defective tyres of Firestone; Ford recalling many of their trucks; Union Carbide gas leak in India (Bhopal gas tragedy), etc.
Expectations/Claims
Sharing of profits; additional stock offerings; assets on liquidation; inspection of company books; transfer of stock; election of board of directors; and applicable additional rights. Interest payments as due and return of principal amount; security of pledged assets; relative priority in the event of liquidation; management and ownership prerogatives if conditions exist with the company (such as default of interest payments).
Creditors
Employees
Attractive compensation package; job satisfaction; freedom from arbitrary behaviour on the part of company officials; share in fringe benefits; freedom to join union and participate in collective bargaining; satisfactory working conditions. Competitive price; service provided with the product; suitable warranties; R&D leading to product improvement; facilitation of credit on attractive terms. Continuing business; timely payment and servicing of credit obligations; professional relationship in contracting for purchasing and receiving goods and services. Taxes (income, excise, sales, etc.); adherence to public policy dealing with the requirement of fair and free competition; discharge of legal obligations of business people (and business organizations); adherence to business law (MRTP, FEMA, etc).
Customers
Suppliers
Governments
Unions
Recognition as the negotiating agent for employees; to be recognized as a participant in the business organization; managemen ts cooperation in fair wage settlement.
Observation of the norms for competitive conduct established by the industry and society; ethical business practices; no price war.
Competitors
Local communities
Place for productive and healthy employment; participation of company officials in community affairs; provision of regular employment; fair play; interest in and, support of, local government; support of cultural and charitable projects. Participation in, and contribution to, society as a whole; assumption of some proportion of the burden of government and society; fair price for products and generating healthy competition.
Hero Honda has adopted a number of villages in and around its plant in Dharughera (near Delhi) for integrated rural development.
CORPORATE SOCIAL RESPONSIBILITY AND PROFITABILITY The relationship between CSR and profit is complex. In the case of CSR, costs and benefits are both economic and social. Economic costs and benefits may be easily quantifiable, but, social costs and benefits are not so easily measurable.
SOCIAL AUDIT
Social audit evaluates or measures a companys performance against planned or laid down social objectives or goals. A social audit should be like a financial audit. A social audit may be undertaken internally by companies; or, they may engage outside consultants to conduct the audit. It improves a companys public image and social standing. In India, social audit was first carried out for Tata Steel by the Social Audit Committee appointed by the company.