Satisficing
Satisficing is a behavioural objective where firms target achieving acceptable or satisfactory profit levels rather than pursuing maximum profit. The firm is satisfied with 'good enough' results that meet stakeholder expectations, particularly management and shareholders.
Real World
John Lewis Partners targets a 'sufficient' annual profit to fund its employee bonus scheme rather than squeezing every last pound of margin, reflecting its partnership ownership structure.
Exam Focus
Link satisficing to the divorce of ownership and control — examiners reward references to bounded rationality.
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