After studying this unit, you should be able to do the following:? Describe the nature and role of vision and mission statements in strategic management? Discuss why the process of developing a mission statement is as important as the resulting document? Identify the components of mission statements? Discuss how clear vision and mission statements can benefit other strategic management activities? Evaluate mission statements of different organisations? Write good vision and mission statementsWhat Do We Want to Become?It is especially important for managers and executives in any organization to agree upon the basic vision that the firm strives to achieve in the long term. A vision statement should answer the basic question, “What do we want to become?” A clear vision provides the foundation for developing a comprehensive mission statement. Many organizations have both a vision and mission statement, but the vision statement should be established first and foremost. The vision statement should be short, preferably one sentence, and as many managers as possible should have input into developing the statement.
Several example vision statements:? The Vision of the National Pawnbrokers Association is to have complete and vibrant membership that enjoys a positive public and political image and is the focal organization of all pawn associations. - National Pawnbrokers Association? Our Vision as an independent community financial institution is to achieve superior long-term shareholder value, exercise exemplary corporate citizenship, and create an environment which promotes and rewards employee development and the consistent delivery of quality service to our customers. - First Reliance Bank of Florence, South Carolina? At CIGNA, we intend to be the best at helping our customers enhance and extend their lives and protect their financial security. Satisfying customers is the key to meeting employee needs and shareholder expectations, and will enable CIGNA to build on our reputation as a financially strong and highly respected company.What is Our Business?Current thought on mission statements is based largely on guidelines set forth in the mid 1970s by Peter Drucker, who is often called “the father of modern management” for his pioneering studies at General Motors Corporation and for his 22 books and hundreds of articles. Harvard Business Review has called Drucker “the preeminent management thinker of our time.
”Drucker says that asking the question “What is our business?” is synonymous with asking the question “What is our mission?” An enduring statement of purpose that distinguishes one organization from other similar enterprises, the mission statement is a declaration of an organization’s “reason for being.” It answers the pivotal question “What is our business?” A clear mission statement is essential for effectively establishing objectives and formulating strategies.Sometimes called a creed statement, a statement of purpose, a statement of philosophy, a statement of beliefs, a statement of business principles, or a statement “defining our business,” a mission statement reveals what an organization wants to be and whom it wants to serve. All organizations have a reason for being, even if strategists have not consciously transformed this reason into writing.
Some strategists spend almost every moment of every day on administrative and tactical concerns, and strategists who rush quickly to establish objectives and implement strategies often overlook the development of a vision and mission statement. This problem is widespread even among large organizations.Some companies develop mission statements simply because they feel it is fashionable, rather than out of any real commitment. However, firms that develop and systematically revisit their vision and mission statements, treat them as living documents, and consider them to be an integral part of the firm’s culture realize great benefits.
Johnson & Johnson (J&J) is an example firm. J&J managers meet regularly with employees to review, reword, and reaffirm the firm’s vision and mission. The entire J&J workforce recognizes the value that top management places on this exercise, and these employees respond accordingly.Vision Versus MissionMany organizations develop both a mission statement and a vision statement. Whereas the mission statement answers the question “What is our business,” the vision statement answers the question “What do we want to become?” Many organizations have both a mission and vision statement.
It can be argued that profit, not mission or vision, is the primary corporate motivator. But profit alone is not enough to motivate people. Profit is perceived negatively by some employees in companies. Employees may see profit as something that they earn and management then uses and even gives away to shareholders. Although this perception is undesired and disturbing to management, it clearly indicates that both profit and vision are needed to effectively motivate a workforce.
When employees and managers together shape or fashion the vision and mission statements for a firm, the resultant documents can reflect the personal visions that managers and employees have in their hearts and minds about their own futures. Shared vision creates a commonality of interests that can lift workers out of the monotony of daily work and put them into a new world of opportunity and challenge.The Process of Developing a Mission StatementA clear mission statement is needed before alternative strategies can be formulated and implemented. It is important to involve as many managers as possible in the process of developing a mission statement, because through involvement, people become committed to an organization.
A widely used approach to developing a mission statement is first to select several articles about mission statements and ask all managers to read these as background information. Then ask managers themselves to prepare a mission statement for the organization. A facilitator, or committee of top managers, should then merge these statements into a single document and distribute this draft mission statement to all managers. A request for modifications, additions, and deletions is needed next, along with meeting to revise the document.
To the extent that all managers have input into and support the final mission statement document, organizations can more easily obtain managers’ support for other strategy formulation, implementation, and evaluation activities. Thus, the process of developing a mission statement represents a great opportunity for strategists to obtain needed support from all managers in the firm.During the process of developing a mission statement, organizations use discussion groups of managers to develop and modify the mission statement. Some organizations hire an outside consultant or facilitator to manage the process and help draft the language. Sometimes an outside person with expertise in developing mission statements, who has unbiased views, can manage the process more effectively than an internal group or committee of managers.
Decisions on how best to communicate the mission to all managers, employees, and external constituencies of an organization are needed when the document is in final form. Some organizations even develop a videotape to explain the mission statement and how it was developed.An article by Campbell and Yeung emphasizes that the process of developing a mission statement should create an “emotional bond” and “sense of mission” between the organization and its employees. Commitment to a company’s strategy and intellectual agreement on the strategies to pursued do not necessarily translate into an emotional bond; hence, strategies that have been formulated may not be implemented. These researchers stress that an emotional bond comes when an individual personally identifies with the underlying values and behavior of a firm, thus turning intellectual agreement and commitment to strategy into a sense of mission.
Campbell and Yeung also differentiate between the terms vision and mission, saying that vision is “a possible and desirable future state of an organization” that includes specific goals, whereas mission is more associated with behavior and the present.
