Chapter Two

The Business Vision and Mission

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 A strategist’s job is to see the company not as it is
but as it can become.
 A corporate vision can focus, direct, motivate, unify,
and even excite a business into superior
performance.
 The job of a strategist is to identify and project a
clear vision.

 A business is not defined by its name, statutes, or

articles of incorporation. It is defined by the
business mission. Only a clear definition of the
mission and purpose of the organization makes
possible clear and realistic business objectives. 2
 The vision statement
• Vision: is a term that encapsulates the
organization's values and aspirations in the
most general terms without specific statements
about strategies used to attain them.

• 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.

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 Cont….
• 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.

• It is especially important for managers and

executives in any organization to agree on the
basic vision that the firm strives to achieve in the
long term. 4
 Vision:
• Provides a picture of the enterprise in 5, 10 or 15 years
with an idea of the position of the enterprise in the
industry as perceived by its environment (customers,
suppliers, share holders, society)
• Provides a focus for longer term organizational goals

• Cannot be realized in the short term, but is sufficiently

provocative to be achievable and measurable challenge
• Assists to create commitment of individuals in the
business
• Assists to the business to create a better image in the
society 5
 The Mission Statement
• 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,”

• Drucker says that asking the question “What is

our business?” is synonymous with asking the
question “What is our mission?”
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 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.

 A business mission is the foundation for

priorities, strategies, plans, and work
assignments.
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 Cont…
• 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.
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 Vision versus Mission
• Many 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.

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 Cont…
• 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. 10
 The Process of Developing Vision and Mission
Statements
• As indicated in the strategic-management model, clear
vision and mission statements are needed before
alternative strategies can be formulated and implemented.

• As many managers as possible should be involved in the

process of developing these statements because through
involvement, people become committed to an organization.

• A widely used approach to developing a vision and mission

statement is first to select several articles about these
statements and ask all managers to read these as
background information. 11
 Cont…
• Then ask managers themselves to prepare
vision and mission statement for the
organization.

• A facilitator, or committee of top managers,

should then merge these statements into a
single document and distribute the draft
statements to all managers.
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 Cont…
• A request for modifications, additions, and
deletions is needed next, along with a meeting
to revise the document.

• To the extent that all managers have input into

and support the final documents, organizations
can more easily obtain managers’ support for
other strategy formulation, implementation,
and evaluation activities.
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 Cont…
• Thus, the process of developing a vision and
mission statement represents a great
opportunity for strategists to obtain needed
support from all managers in the firm.

• During the process of developing vision and

mission statements, some organizations use
discussion groups of managers to develop and
modify existing statements.
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 Cont…
• 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 such statements, who has unbiased
views, can manage the process more effectively
than an internal group or committee of managers.

• Some organizations even develop a videotape to

explain the statements, and how they were
developed. 15
 Benefits of Vision and Mission
Statements
Achieve clarity of purpose among all managers and
employees.

Provide a basis for all other strategic planning activities,

including the internal and external assessment,
establishing objectives, developing strategies, choosing
among alternative strategies, devising policies,
establishing organizational structure, allocating
resources, and evaluating performance.

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 Cont…
Provide direction.

Provide a focal point for all stakeholders of

the firm.
Resolve divergent views among managers.

 Promote a sense of shared expectations

among all managers and employees.
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 Cont…
 Project a sense of worth and intent to all stakeholders.

 Project an organized, motivated organization worthy of

support.

 Achieve higher organizational performance.

 Achieve synergy among all managers and employees.

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 Cont…
To facilitate the translation of objectives into a
work structure involving the assignment of tasks
to responsible elements within the organization.

 To specify organizational purposes and then to

translate these purposes into objectives in such a
way that cost, time, and performance parameters
can be assessed and controlled.
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 Characteristics of a Mission
Statement
A Declaration of Attitude
• A mission statement is more than a statement of
specific details; it is a declaration of attitude and
outlook.

• It usually is broad in scope for at least two major

reasons.

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• First, a good mission statement allows for the
generation and consideration of a range of
feasible alternative objectives and strategies
without unduly stifling management creativity.

• Second, a mission statement needs to be broad

to reconcile differences effectively among, and
appeal to, an organization’s diverse
stakeholders, the individuals and groups of
individuals who have a special stake or claim
on the company.
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 Cont…

A Customer Orientation
• A good mission statement describes an
organization’s purpose, customers, products
or services, markets, philosophy, and basic
technology.

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 Cont…
According to Vern McGinnis, a mission
statement should :
 Define what the organization is and what the
organization aspires to be,
 Be limited enough to exclude some ventures
and broad enough to allow for creative
growth,
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 Cont….
 Distinguish a given organization from all
others,
 Serve as a framework for evaluating both
current and prospective activities, and
 Be stated in terms sufficiently clear to be
widely understood throughout the
organization. 24
• A good mission statement reflects the anticipations
of customers.
• Rather than developing a product and then trying to
find a market, the operating philosophy of
organizations should be to identify customers’ needs
and then provide a product or service to fulfill those
needs.
• Good mission statements identify the utility of a
firm’s products to its customers.
• A major reason for developing a business mission
statement is to attract customers who give meaning
to an organization.
• It is the customer who determines what a business is.
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In general of a Mission Statement has the following Characteristics
• Broad in scope; do not include monetary amounts, numbers,
percentages, ratios, or objectives
• 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 customers, products or services,
markets, technology, concern for survival/growth/profits,
philosophy, self-concept, concern for public image, concern for
employees
• Reconciliatory
• Enduring
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 Mission Statement Components
• Mission statements can and do vary in length,
content, format, and specificity.

• Most practitioners and academicians of strategic

management feel that an effective statement
should include nine components.

• Because a mission statement is often the most

visible and public part of the strategic-
management process, it is important that it
includes the nine characteristics. 27
 Mission Statement Components
Customers-Who are the firm’s customers?
Products or services-What are the firm’s major
products or services?

Markets-Geographically, where does the firm

compete?
Technology-Is the firm technologically current?

Concern for survival, growth, and profitability-

Is the firm committed to growth and financial
soundness? 28
 Cont…
Philosophy-What are the basic beliefs, values,
aspirations, and ethical priorities of the firm?
 Self-concept-What is the firm’s distinctive
competence or major competitive advantage?

Concern for public image-Is the firm

responsive to social, community, and
environmental concerns?
Concern for employees-Are employees a
valuable asset of the firm?
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 SAMPLE VISION STATEMENTS
• Tyson Foods’ vision is
To be the world’s first choice for protein
solutions while maximizing shareholder value.

• General Motors’ vision is

To be the world leader in transportation
products and related services.

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 CONT….
• 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.

• First Reliance Bank is

To be recognized as the largest and most profitable
bank in South Carolina.
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 SAMPLE MISSION STATEMENTS
PEPSI MISSION:
 We aspire to make PepsiCo the world’s premier
consumer products company, focused on
convenient foods and beverages .
 We seek to produce healthy financial rewards for
investors as we provide opportunities for growth
and enrichment to our employees, our business
partners and the communities in which we operate.
And in everything we do, we strive to act with
honesty, openness, fairness and integrity.
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 Cont….
• The above mission lacks:
»Customer
»Technology
»Self concept

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 Cont….
Dell’s mission is :
• To be the most successful computer company in
the world at delivering the best customer
experience in markets we serve . In doing so, Dell
will meet customer expectations of highest
quality; leading technology ; competitive pricing;
individual and company accountability ; best-in-
class service and support ; flexible customization
capability ; superior corporate citizenship ;
financial stability .
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 Cont….

Statement lacks only one component:

• Concern for Employees

Conclusion
• In general, every organization has a unique
purpose and reason for being. This uniqueness
should be reflected in vision and mission
statements.
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Thank you for your kind
attention!!!

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