Mission statement an it's paramters
- 1. Business modeling Name: Waqar Saleem Khan Topic: What is mission statement and its characteristics and take any company missionstatement, discuss thosecharacteristics according tocompany’s mission statement. Definition of mission statement Missionstatementisadescriptionof whatanorganizationactuallydoes –what itsbusinessis –and why it doesit. Understandingthe tool Oftencalledthe “credo”,“philosophy”,“core values”or“ouraspirations”,organization’smissionisthe statementthatdefinesitscore purpose orreasonforbeing.Ittellswhoacompanyis and whatit does. Accordingto P.Drucker,oftencalledthe fatherof modernmanagement,amissionisthe primary guidance increatingplans,strategiesormakingdailydecisions.Itisanimportantcommunicationtool that conveysinformationaboutorganization’sproducts,services,targetedcustomers,geographic markets,philosophies,valuesandplansforfuture growthtoall of its stakeholders.Inotherwords,every majorreasonwhy companyexistsmustbe reflectedinitsmission,soanyemployee,supplier,customer or communitywouldunderstandthe drivingforce behindorganization’soperations. There are two types of statements:
- 2. • Customer-orientedmissions.Customer-orientedmissionsdefineorganization’spurpose in termsof meetingcustomerneedsorprovidingsolutionsforthem.Theyprovidemore flexibilitythan product-orientedmissionsandcan be easilyadaptedtochangingenvironment.Forexample,Nokia’s statement“connectingpeople”iscustomer-oriented.Itdoesnotfocuson mobile phonesor smartphonesonly.Itprovidesasolutiontocustomerneedsandcouldeasilyhave worked50 yearsago, and will continue toworkinthe future.Italsogivesmore strategicflexibilityforthe company.InNokia’s case,it may start providingVoIPsoftware toallow callstobe made overthe internetanditsmission wouldstill be valid. • Product-orientedmissions.Product-orientedmissionsfocusonwhatproductsor servicesto serve ratherthan whatsolutionstoprovide forcustomers.These statementsprovide lessflexibilityfor the companybecause mostproductshave short life cycle andofferlimitedmarketexpansion.The companythat definesitsbusinessas“providingbesthealthinsurance products”maystruggle togrowto otherinsurance productcategories. For a mission to be effective it must include the following 9 components: 1. Customers.Who are your customers?How do youbenefitthem? 2. Products or services.What are the mainproductsor servicesthatyouofferand their uniqueness? 3. Markets. Inwhichgeographical marketsdoyouoperate? 4. Technology.What isthe firm’sbasictechnology? 5. Concernfor survival.Is the firmcommittedtogrowthand financial soundness? 6. Philosophy.Whatare the basic beliefs,valuesandphilosophiesthatguide anorganization? 7. Self-concept.Whatare the firm’sstrengths,competenciesorcompetitiveadvantages? 8. Concernfor publicimage.Is the firmsociallyresponsible andenvironmentallyfriendly? 9. Concernfor employees.Howdoesacompanytreatits employees? Why creating a mission is important?
- 3. Many studieshave beenconductedtofindoutif havingandcommunicatingmissionstatementhelpsan organizationtoachieve higherperformance The resultswere mixed.Some studiesfoundpositive relationshipbetweenwrittenstatementsandhigherorganizationalperformance,whileotherstudies foundnone or evennegativerelationship.One of the reasonsmightbe thatmost of the companies create missionstatementonlybecause it’sfashionabletodoso and little effortismade toactually communicate thatmissiontoitsstakeholders.Davidarguesthatif anorganizationconstantlyrevisesits missionandtreatsitas a livingdocument,itachieveshigherperformance thanitscompetitors. Nonetheless,all of the authorsagree thatmissionbringsthe following benefits. • Informs organization’sstakeholdersabout its plansand goals; • Unifiesemployees’effortsinpursuingcompany goals; • Servesas an effective publicrelationstool; • Providesbasis for allocatingresources; • Guidesstrategicor dailydecisionmaking; • Shows that a company is proactive. How to Writing a mission Creatinga missionstatementisanimportantfirststepinclearlyidentifyingyourbusiness’reasonfor being.It’shardto do it right.Therefore,we identifiedthese stepsandguidelinestohelpyouwrite an effectivestatement. Step1: Gathera teamof managers,employeesandshareholders.Missionisthe statementthatmustbe understoodbyemployeesof all levels.Involvingmore people willletyoufindouthow eachof them seesanorganizationanditscore purpose.Inaddition,employeeswillsupportorganization’smission more if theywill be involvedinthe processof creatingit. Step2: Answerall 9 questionsforeffective mission.Manypractitionersandacademicsagree thata comprehensive statementmustinclude all 9components.Onlythencreatingamissioncanbenefita company.Atthis stage,tryto honestlyanswerall the questionsandidentifyyourcustomers,markets, valuesetc.Itmay take a lotof time butit’sworthit. Step3: Findthe bestcombination.Collectthe answersfromeveryone andtryto combine one mission statementoutof them.Duringthisstep,youcan make sure that everyone understandscompany’s reasonfor beingandthere are no conflictingviews left. Following guidelines (all takenfromvarious studies) shouldalsobe helpful in writing an effective missionstatement:
- 4. • ‘Publicimage’,‘concernforemployees’,‘philosophy’and‘customers’are the mostimportant componentsof a mission • ‘Citizenship’,‘teamwork’,‘excellence’and‘integrity’are the valuesusedmostoftenbythe companieswitheffective missions. • Influential statementsincludewordssuchas:‘communities’,‘customers’,‘employees’,‘ethics’, ‘global’and‘quality/value’. Intel mission statement “Delight our customers, employees, and shareholders by relentlessly delivering the platform and technology advancements that become essential to the way we work and live.” 1: Function customers, 2: employees, shareholders 3: Relentlessly delivering the platform 4: technology Intel’s missionis poor because it lacks five components: 1: markets 2: philosophy 3: self-concept 4: publicimage 5: target reign. It is customer-orientedbutdoesnotuse anyof the top4 valuesandis too short. Toyota mission statement
- 5. Toyota will lead the way to the future of mobility, enriching lives around the world(3) with the safest and most responsible(6) ways of moving people(1). Through our commitment to quality, constant innovation (4,7) and respect for the planet(8), we aim to exceed expectations and be rewarded with a smile. We will meet challenging goals (5) by engaging the talent and passion of people(9), who believe there is always a better way.(6) 1. Customers.Who are your customers? How do youbenefitthem? Way of movingpeople. 2. Products or services.What are the mainproductsor servicesthatyouoffer?Theiruniqueness? Toyota doesnotfulfillit 3. Markets. Inwhichgeographical marketsdoyouoperate? Enriching lives around the world 4. Technology.What isthe firm’sbasictechnology? Through our commitment to quality, constant innovation 5. Concernfor survival.Is the firmcommittedtogrowthand financial soundness? We will meet challenging goals 6. Philosophy.Whatare the basic beliefs, valuesandphilosophiesthatguide anorganization? Who believe there is always a better way 7. Self-concept.Whatare the firm’sstrengths,competenciesorcompetitiveadvantages? Through our commitment to quality, constant innovation 8. Concernfor publicimage.Is the firmsociallyresponsible andenvironmentallyfriendly? Respect for the planet, his aim to exceed expectations 9. Concernfor employees.Howdoesacompanytreatits employees? By engaging the talent and passion of people Toyota hasonlymissedtomentionitsproducts.Theirmissioniscustomer-oriented,inspiringand enduringbutitdoesn’tclearlymentionitscustomersorsocial responsibilities. Reference
- 6. 1. Rothaermel,F.T.(2012). StrategicManagement:ConceptsandCases. McGraw-Hill/Irwin,p.34- 37 2. David,F.R.(2009). StrategicManagement:ConceptsandCases.12th ed.FT Prentice Hall,p.83- 94 3. Williams,L.S.(2008).The MissionStatement.A Corporate ReportingTool withaPast,Present, and Future.Journal of BusinessCommunicationVol.45,(2),pp.94-119 4. King,D.L.,Case,C.J.,PremoP.M. (2010). CurrentMissionStatementEmphasis:Be Ethical andGo Global.Academyof StrategicManagementJournal Vol.9(2),pp.71-87 5. Wikipedia(2013).MissionStatement.Availableat: https://en.wikipedia.org/wiki/Mission_statement 6. MissionStatements.com(2013).MissionStatementExamples.Available at: http://www.missionstatements.com/