2. vision & mission
DESCRIPTION
strategic management topicsTRANSCRIPT
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The Business The Business VisionVision
and Missionand Mission
Chapter Two
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Chapter Objectives
1. Describe the nature and role of vision and mission statements in strategic management.
2. Discuss why the process of developing a mission statement is as important as the resulting document.
3. Identify the components of mission statements.
4. Discuss how clear vision and mission statements can benefit other strategic-management activities.
5. Evaluate mission statements of different organizations.
6. How the core values are defined in accordance with companies vision and mission.
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A Comprehensive Strategic-Management Model
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Vision
• “We choose to go to the moon.”(John F Kennedy 1962)
• “I have a dream.”Dr. Martin Luther King, Jr.August 28, 1963• “It is my unique responsibility as the leader to
shine a spotlight on the future….”(Margaret Thatcher,)Former Prime Minister of England
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What Do We Want to Become?
A vision statement should answer the basic question, “What do we want to become?”
“A short, inspiring statement of where you’d like to get to. It provides a unified direction for everyone in an organization and is a continual source of inspiration which cannot be ‘achieved”
“A strong aspiration; Desired future state »
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Vision
Criteria for a Meaningful Vision
A vision engages the heart and the spirit. ... leads toward a worthwhile goal. ... gives meaning to an effort. ... is simple. ... is attainable. ... can change over time.
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Some examples
Walt Disney: To make people happyNike: To experience the emotion of
competition, winning and crushing competitors
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Vision Statement Examples
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ComprehensiveMission Statement
Vision
Clear Business Vision
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Answers the question: “What is our business?”
Reveals: what the organization wants to be whom we want to serve
Mission Statement
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“The fundamental purpose that sets a firm apart from other firms of its type and identifies the scope of its operations in product and market terms”(pearce)
« An overriding purpose in line with the values and expectations of stakeholders ».
Johnson & Scholes
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Mission
“A mission is a brief statement that reflects the core values of an organization.”
“A mission communicates an organization’s long-term objectives”
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Questions Addressed By a MissionStatement(pearce)
Why is this firm in business? What are our economic goals? What is our operating philosophy in terms
of quality, company image, and self-concept?
What are our core competencies and competitive advantages?
What customers do and can we serve? How do we view our responsibilities to
stockholders, employees, communities, environment, social issues, and competitors?
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Objectives of developing mission
statementA Mission Statement … Serves as a communication tool for an organization Aligns people with a purpose; it fosters commitment and unity Defines directions for change and growth Acts as an evaluation tool to help measure activities and programs reveals what an organization wants to be and whom it wants to serve
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Mission Statements are also called
Creed statementStatement of purposeStatement of philosophyStatement of beliefsStatement of business principlesA statement “defining our business”
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Characteristics of a Mission Statement
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
Third, include employees, managers, stockholders, boards of directors, customers, suppliers, distributors, creditors, governments (local, state, federal, and foreign), unions, competitors, environmental groups, and the general public.
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Interest Groups
Customers /Competitors
Technostructure/ Support staff
M iddle M anagers/ Operating Core
Suppliers
Shareholders /Board
Government /Professionalassociations
SeniorM anagement
Contract Staff /Special Interest
Groups
Interest Groups
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Mission Components
CustomersMarkets
Employees
PublicImage
Self-Concept Philosophy
Survival,Growth,Profits
Products orServices
Technology
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Mission Statement Components
1. Customers—Who are the firm’s customers?
2. Products or services—What are the firm’s major products or services?
3. Markets—Geographically, where does the firm compete?
4. Technology—Is the firm technologically current?
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Mission Statement Components
5. Concern for survival, growth, and profitability—Is the firm committed to growth and financial soundness?
6. Philosophy—What are the basic beliefs, values, aspirations, and ethical priorities of the firm?
7. Self-concept—What is the firm’s distinctive competence or major competitive advantage?
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Mission Statement Components
8. Concern for public image—Is the firm responsive to social, community, and environmental concerns?
9. Concern for employees—Are employees a valuable asset of the firm?
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Characteristics of a Mission Statement
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Example Mission Statements
Fleetwood Enterprises will lead the recreational vehicle and manufactured housing industries (2, 7) in providing quality products, with a passion for customer-driven innovation (1). We will emphasize training, embrace diversity and provide growth opportunities for our associates and our dealers (9). We will lead our industries in the application of appropriate technologies (4). We will operate at the highest levels of ethics and compliance with a focus on exemplary corporate governance (6). We will deliver value to our shareholders, positive operating results and industry-leading earnings (5).
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Example Mission Statements
We aspire to make PepsiCo the world’s (3) premier consumer products company, focused on convenient foods and beverages (2). We seek to produce healthy financial rewards for investors (5) as we provide opportunities for growth and enrichment to our employees (9), our business partners and the communities (8) in which we operate. And in everything we do, we strive to act with honesty, openness, fairness and integrity (6).
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Example Mission Statements
Dell’s mission is to be the most successful computer company (2) in the world (3) at delivering the best customer experience in markets we serve (1). In doing so, Dell will meet customer expectations of highest quality; leading technology (4); competitive pricing; individual and company accountability (6); best-in-class service and support (7); flexible customization capability (7); superior corporate citizenship (8); financial stability (5).
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Example Mission Statements
Procter & Gamble will provide branded products and services of superior quality and value (7) that improve the lives of the world’s (3) consumers. As a result, consumers (1) will reward us with industry leadership in sales, profit (5), and value creation, allowing our people (9), our shareholders, and the communities (8) in which we live and work to prosper.
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Example Mission Statements
At L’Oreal, we believe that lasting business success is built upon ethical (6) standards which guide growth and on a genuine sense of responsibility to our employees (9), our consumers, our environment and to the communities in which we operate (8).
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Process of developing strategic directions
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Vision Life-changing fitness experiences every time, everywhere
MissionTo be number one in Group Fitness experiences in all its markets and to
be a top 100 global brand
Values Brave, Change the world, One tribe
Goal(s)
15,000 clubs, a four-program average per club and 10 million
people per week working out in LES MILLS™ classes by 2010
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The Process of Developing Vision and Mission Statements
Select several articles about these statements and ask all managers to read these as background information.
Ask managers themselves to prepare a vision and mission statement for the organization.
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The Process of Developing Vision and Mission Statements
Merge these statements into a single document and distribute the draft statements to all managers
Process should create an “emotional bond” and “sense of mission” between the organization and its employees
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Importance of Vision and Mission Statements
To ensure unanimity of purpose within the organization To provide a basis, or standard, for allocating organizational resources To establish a general tone or organizational climate To serve as a focal point for individuals to identify with the organization’s purpose and direction To facilitate the translation of objectives into a work structure To specify organizational purposes To serve as a focal point for individuals to identify with the organization’s purpose and direction To facilitate the translation of objectives into a work structure To specify organizational purposes Arouse positive feelings & emotions Motivate readers to action Generate favorable impression of the firm Generate strategic alternatives Not overly specific Reconciles interests among diverse stakeholders
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Benefits of Having a Clear Mission and Vision
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Newest Trends in MissionComponents
Sensitivity to customer wants• “The customer is our top priority!”• Emphasis on extensive product safety programs
Concern for quality• “Quality is job one!”• Emphasis on quality in manufacturing• New philosophy – quality is the norm
Statements of company vision• Developed to express the aspirations of the executive
leadership• Presents the firm’s strategic intent• “A computer on every desk, and in every home, running on
Microsoft software”
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Values
“Guiding principles which affect how will behave every day on the way to fulfilling your mission”
“Values are core beliefs or desires that guide or motivate our attitudes and actions”
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Origins of Values
Principles or standards Personal Qualities Character Traits Codes of Ethics Goals
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Examples
Walt Disney
• No cynicism
• Nurturing of ‘wholesome American values’
• Creativity, dreams and imagination
• Fanatical attention to consistency and detail
• Preservation and control of the Disney Magic Merck
• Corporate social responsibility
• Unequivocal excellence in all aspects of the company
• Science based innovation
• Honesty and integrity
• Profit from work that benefits humanity
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Goals
“Key benchmarks for achieving your mission” (must include quantifiable targets)
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Organisational Objectives [2]
Generally ‘SMART’: Specific Measurable Achievable Realistic Timely
Consistent with the Mission and Aim. One direction, avoid dissonance!!!
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Objectives - Examples A larger market share Quicker design-to-market times than rivals Higher product quality than rivals Lower costs relative to key competitors Broader / more attractive product line than rivals A stronger reputation with customers than rivals Superior customer service Recognition as a leader in technology and/or
product innovation Wider geographic coverage than rivals
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Concluding Remarks(Some expert views)
To be an effective change leader, you must have strong vision.(HBR) Vision& mission statements should be professionally developed and communicated through
broader stakeholders participation (HBR) Statements are Difficult to develop particularly in turbulently changing time(HBR) These Should reflect followers aspirations(James) Leaders should be able to articulate vision overtime(James) Statements should be straightforward and clear(Baldoni) Create organizational and personal expectations(Baldoni) Directs organizations and individuals(Baldoni) Vision directs and inspire people in the right direction(Cohen) Core values and core purpose remains same while strategies and practices have to be
changed(Collins) Success depends upon successful balancing of continuity and change.(Collins) Effective vision essentially give general direction, motivates people to take actions and
coordinate actions of different people.(Kotter) Strong and influential vision is starting point of change Vision should be constantly and effectively communicated to get people’s support(Kotter)
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