1.1 Introduction

This unit serves to discuss the issue that reconcile the business community and the society within it operates, from which it gets its human factor and other resources and to whom the business sells its products, services or ideas. Their co-existence has to be cordial and harmonious.

1.2 Objectives

By the end of this lesson, you should be able to:

• Understand the organization as a system and its various implications.

• Understand organization-environment interface and adopt strategies to deal with the same.

• Understand the basic nature of the organization by defining and classifying it.

1.3 Changing concept and objectives of business.

Setting of organizational objectives is the starting point of managerial actions. Since organizations are deliberate and purposive creations, they have some objectives; the end results for which they strive. These end results are referred to as mission, purpose, objective, goal, target, and etc. many times, these terms are used interchangeable as all these denote end results. However, there are differences in the context in which these are used.

The mission of an organization has external orientation and relates the organization to the society in which it operates. A mission statement helps the organization to link its activities to the needs of the society and legitimize its existence. As opposed to the mission, objectives of an organization are precise and are used to specify and end results, which an organization wants to achieve.

Objectives and goals are the end results, which an organization strives for. Since there may be different ways be different ways in expressing end results like market leadership (a qualitative measurement), or a certain percentage of increase in sales in a particular year (a quantitative measurement), the question is: for which result the term objectives should be used and for which result the term goal should be used. This problem arises because these two terms are used in a variety of ways; many of which are conflicting.

According to Ackoff, “Desired states or outcomes are objectives. Goals are objectives that are scheduled for attainment during planned period.

This is the purpose that an organization strives to achieve. Organizations, like Kenyatta University often have more than one goal. Goals are fundamental elements of organizations.

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