A private sector business is one that operates outside of a country’s government. The main types of private sector businesses in the UK are sole traders, partnerships, companies and franchises. Charities also operate in the private sector. The activities of a business within the private sector are focused on aims and objectives. These aims and objectives will vary according to the size, type and organisation of each individual business.
Private sector aims
An aim is a goal that a company wants to achieve. In the private sector, this will usually involve maximising profit and increasing market share in order for the business to expand and develop. Aims aside from those related directly to profit may include expansion of the business or the building of a recognisable brand.
Private sector objectives
An objective will set out the steps for achieving the aim of a business; it will define how the business will meet those aims. These objectives will usually be set at different levels, from those objectives to be achieved by a board of director’s, for example, down to targets given to individual employees. Again, this will depend on the size and nature of the business. Objectives could include meeting certain time scales when dealing with customer queries or increasing the number of sales by a certain percentage in a given period.
SMART objectives
Objectives need to be clear and concise in order to be achieved. SMART objectives allow a business to monitor the progress it is making towards an aim. SMART objectives are:
Specific: a clear statement of what is to be achieved
Measurable: in order to monitor what progress is being made
Achievable: objectives can be challenging, but it is important that they are also attainable
Realistic: with respect to the economic climate and resources, both financial and staffing
Time bound: there should be an agreement as to when the objective will be reached
Aims and objectives of charities
Although charities are within the private sector, their aims and objectives will be different to other types of business. A charity’s aims will be based on the changes it wants to help achieve. For example, Oxfam aims to tackle poverty. It will have objectives in order to reach this broad aim, money raising targets for example.