The Business Vision & Mission - Rof's Blog · “The last thing IBM needs right now is a vision.”...
Transcript of The Business Vision & Mission - Rof's Blog · “The last thing IBM needs right now is a vision.”...
Today Agenda
� What Do We Want to Become?
� What Is Our Business?
� Importance of Vision and Mission Statements
� Characteristics of a Mission Statement
� Components of a Mission Statement
� Writing & Evaluating Mission Statements
Vision
“The last thing IBM needs right now is a vision.” (July 1993)
“What IBM needs most right now is a vision.” (March 1996)
– Louis V. Gerstner, Jr., CEO, IBM Corporation
“What do we want to become?”
ComprehensiveMission Statement
Clear BusinessClear BusinessVision
Vision
Agreement on the basic vision for which the firm strives to achieve in the long run is critically important to the firm’s success.
Shared Vision
�Creates commonality of interests
�Reduce daily monotony
�Provides opportunity & challenge
Profit & vision are necessary to
effectively motivate a workforce
Vision Statement Examples
General Motors’ vision is to be the world leader in transportation products and related services.
PepsiCo’s responsibility is to continually improve all aspects of the world in which we operate –
environment, social, economic – creating a better tomorrow than today.
Dell’s vision is to create a company culture where environmental excellence is second nature.
Mission Statements
90% of all companies have used a mission statement in the
previous five years
“What is our business?”
� Enduring statement of purpose� Distinguishes one firm from another� Declares the firm’s reason for being
Also referred to as : Creed statement, Statement of purpose, Statement of philosophy, Statement of business principles
Mission Statements
Reveal what an organization wants to be
and whom it wants to serve
Essential for effectively establishing objectives
and formulating strategies
Clear mission is needed before alternative
strategies can be formulated and implemented
Participation from diverse managers
is important in developing the mission
Many organizations develop both vision & mission statements
Importance of Mission
Benefits from a strong mission� Ensure Unanimity of Purpose� Provide a basis of Resource Allocation� Establish Organizational Climate� Focal Point to identify or deter
� 2x average return on shareholders’ equity
� Positive relationship to company performance
� 30% higher return on certain financial measures
Research results are mixed, however, firms with formal mission statements generally show:
Effective Missions
� Broad in scope
� Generate strategic alternatives
� Not overly specific
� Reconciles interests among diverse stakeholders
� Finely balanced between specificity & generality
� Basis for generating & evaluating strategic options
� Provide criteria for strategy selection
� Generate favorable impression of the firm
� Arouse positive feelings & emotions
� Motivate readers to action
� Reflect future growth
� Are dynamic in nature
Natural Environmental Perspective
Is Your Firm Environmentally Proactive?
� Preserving the natural resources is good business!
� Reactive environmental policies can be expensive
� Proactive policies force companies to innovate and upgrade processes
Mission and Customer Orientation
An Effective Mission Statement
� Anticipates customer needs
� Identifies customer needs
� Provides product/service to satisfy needs
Do not offer me shoes
Offer me comfort for my feet and the pleasure of walking
Do not offer me a house
Offer me security, comfort and a place that bring happiness
Social Policy and Mission
� Managerial philosophy shapes social policy
� Affects development of vision & mission
� Social policy should be integrated in all strategic-management activities
� Mission should convey the social responsibility of the firm
� Responsibilities to
� Consumers
� Environmentalists
�Minorities
� Communities
Mission Statement
2007 Most Admired in Social Responsibility
1. CHS2. United Parcel Service3. Whole Foods Market4. McDonald’s5. Alcan
6. YRC Worldwide7. Starbucks8. International Paper9. Vulcan Materials10. Walt Disney
2007 Least Admired in Social Responsibility
1. Visteon2. Dana3. CA4. Delphi5. Federal-Mogul
6. Arvin Meritor7. Huntsman8. Navistar International9. Lyondell Chemical10. Toys “R” Us
Characteristics of a Mission Statement
�Broad in scope
�Less than 250 words in length
�Inspiring
�Identify the utility of a firm's products
�Reveal that the firm is socially responsible
�Reveal that the firm is environmentally responsible
�Include nine components
1) customers, 2) products or services, 3) markets, 4) technology, 5) concern for survival/growth/profits, 6) philosophy, 7) self-concept, 8) concern for public image, 9) concern for employees
�Enduring
Mission Statement Examples
Dell’s mission is to be the most successful computercompany in the world at delivering the best customerexperience in markets we serve. In doing so, Dell willmeet consumer expectations of highest quality;leading technology; competitive pricing; individualand company accountability; best-in-class service andsupport; flexible customization capability; superiorcorporate citizenship; financial stability.
Proctor & Gamble will provide branded products andservices of superior quality and value that improve thelives of the world’s consumers. As a result, consumerswill reward us with industry leadership in sales, profit,and value creation, allowing our people, ourshareholders, and the communities in which we liveand work to prosper.
Organization
Component
Customers
Products or
Services Markets
Concern for
Survival,
Growth,
Profitability Technology Philosophy
Self-
Concept
Concern for
Public
Image
Concern for
Employees
Dell Yes Yes Yes Yes Yes Yes Yes Yes No
Proctor & Gamble
Yes No Yes Yes Yes Yes Yes Yes Yes
Mission Statement Evaluation Matrix