What are the economic and Social Goals of Business?

Business goals may be economic as well as social. First, we shall discuss economic goals and then we will take up the social goals.

Economic Goals:

Economic Goals comprise:

a.      High Standard of Living: It means high levels of production and consumption. This requires high levels of income and achievement of high levels of productivity.

b.      Market Leadership: To earn a niche for one self in the market innovation is key factor. Good businessperson are aware of the fact they have an overriding obligation, “to be innovative” that is each time they have to increase efficiency, productivity and must build, expand and put forth new goods and services in order to remain market leader. Research and Development (R&D) is also essential in addition to investment of profits in the purchase of new machines, tools and equipment.

c.       Economic Progress: Another important economic goal of business is economic progress, which can be achieved by making an optimum utilisation of material and non-material resources of capital by developing inventiveness skills and staff development programmes. It is also essential to utilise energy saving devices and environmental friendly techniques of production so that economic progress is sustained in the end.

d.      Economic stability: Capitalist or a free enterprise economy regularly faces business cycles. Government can achieve economic stability if it utilises its economic and fiscal policy for achieving the goal of stabilisation. Economic stability can also be achieved by making accurate sales forecasts, preparing production schedules, diversifying products and stimulating sales in off-season so that frequent fluctuations are avoided. Government may also utilise its credit control policy, bank rate, CRR and Repo rate policy for this purpose.

Social Goals

Economic Goals comprise:

a.      Justice and Equality: It means that business should not lead to concentration of economic power in the hands of a few. It should try to equitable distribution of wealth and means of production among population. This requires opportunities for all through education, public health services fairness in distribution of income improvement of neighbourhood and family environments and equality of opportunities for advancement to all irrespective of caste, creed, colour, sex, age, physical appearance, political application or social status.

b.      Social Security or safety nets:  Certain contingencies of life which are beyond the means and control of an individual because of old age, physical disability, illness, accident, poverty and other such hazards of life like retrenchment, unemployment, maternity, etc. are provided for by business adopting insurance schemes, provident fund, pension and medical facilities leave with pay for certain specified period. The provision for such contingencies assures a minimum standard of living.

c.       Community Life: The Business should maintain good relations with community. Industry should organise fairs and festivals in which the workers and their families participates and enjoy the community life. In such gatherings, officers should also take part. Special programmes for female staff and children are also important. For this a part of the profit of the company should be set aside.

d.      Community Improvement: The community improvement can be achieved by proper planning, location of factories and markets at proper places, disposal of smoke and waste, removing ugly appearance by proper colouring and whitewash slum clearance, sanitation schemes so that living environment of the community is made healthy. Workers performance also increases in such surroundings.

e.      Educational Programmes: Business must start community schools in the surrounding villages. Education is required for the employees, customers, government and public. Education  is imparted to achieve these objectives: (a) to improve industrial relations in the factory, (b) to safeguard interest of the shareholders, (c) to develop better public relations.

f.        Friendly Atmosphere in the Company: Friendly atmosphere in the company ensures that workers are also partners in growth rather than servants. Opportunities are, therefore, to be provided for personal development of workers by careful job selection, promoting, delegation of powers and sharing responsibilities. The labours are also human beings they should not be treated as a commodity of commerce.

In view of these diverse goals, it has rightly been said that gone are the days service to customers and profit to owners were the twin objectives of the business. In fact, business also has social and national goals to fulfil. However, the true goals of business should be the economic goals viz., to bring satisfaction to the consumer and profit to owners. It is the consumer who is supreme and it is he who directs business, what to produce and sell in the society.

In short business goals are:               

(i)    Earning profit

(ii)  Earning livelihood

(iii)Rendering a public service

(iv)Employee satisfaction and development

(v)  Service to the society

(vi) Joy of creation

(vii) Quality products and services

(viii)  Protecting interests

    

However, it may be noted it is based on above-mentioned economic and social goals that performance of a business is judged. A businessperson should ask these questions to himself while taking decisions. Business decisions should not only serve the interests of the entrepreneurs but also of the society. Its success or failure is judged in terms of public interest and public goods served. 

***