Chapter 2 – The Business Vision And Mission
“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 & the purpose of
the organization make possible clear & realistic business objectives”
“A corporate vision can focus, direct, motivate, unify, & even excite a business into a
superior performance. The job of a strategist is to identify & project a clear vision”
“The job of a strategist to see the company not as it is …. but as it can become.”
John W. Teets Chairman of Greyhounds.Inc.
The Purpose & Objectives of the Chapter
To focus on the tools & concepts needed to evaluate & write Business vision &
Role of vision & mission in strategic management
The importance of process of developing a vision &mission statement
Understanding Vision & Mission Statement
A new business is a collection of ideas that the organization can offer some
product or service to some customers, in some geographic area, using some type
of technology, at a profitable price.
That the management philosophy would result in a favorable public image & this
concept of business would be communicated to & adopted by important
Is profit the primary corporate motivator. Yes but it can’t motivate the employees
or other stakeholders.
These ideas underlie the vision & mission statements.
These are living documents. With growth the ideas can be revised & hence the
Vision & mission statements form part of all important documents.(Annual
reports, information sent to constituencies,, loan requests, supplier& customer
agreements, labor contracts…)
The Vision Statement
A desirable future state
What the organization wants to become in long term
Provides the foundation for mission statement hence framed first
Be short preferably one statement & involve input from as many managers as
In a global environment push one vision instead of driving home different
messages in different cultures, by keeping it simple. “ we make the world’s fastest
The Mission Statement (creed, purpose, philosophy, beliefs)
What is the organization’s business (it is beyond building steel, furniture, lending
The reason for being, statement of purpose which distinguishes it from other
More associated with present & with behavior; how to do the business, what it
wants to do & whom it wants to serve
Not designed to express concrete ends but to provide motivation, direction, image,
tone & a philosophy to guide the enterprise.
The Process of developing a Mission Statement:- the first step in SM
Involve as many managers as possible.
Series of steps
1. Give managers, employees reading material.
2. Ask them to prepare the statements.
3. A facilitator or committee of top managers to merge these statements &
referred back to mangers for modifications. Divergent views need be
revealed & resolved (or else top, management would remain divided e.g.
of failed Grant Bank, Wal-Mart Vs JC penny) through the process.(e.g. in
a university divergent views regarding importance of teaching, research &
service / consultancy). It is always a choice between alternatives which in
turn rest on different assumptions regarding business & its environment.
4. finally communication of final statement to all internal & external stake
holders(e.g. video tape)
Importance of Vision & Mission Statements
Shared vision / mission create commonality of interests, purpose, shared
expectations (as against individual & parochial interests) & give mangers &
employees a cause for motivation. Through involvement people become
committed. This would later help in formulation & implementation of strategies.
An emotional bond comes when an individual personally identifies with the
underlying values & behaviors of a firm.
Positive relation between mission statements & organizational
performance.(mixed research results)
Sets tone for organizational culture & climate.
Essential for setting priorities, objectives, strategies, plan, allocation of resources.
Starting point for design of managerial jobs, managerial structures etc.(a change
in mission / vision leads to changes in these)
Without clear statements firms’ short term actions may be counter productive to
Mission Statement Components:- A Frame Work for writing &Evaluating
1. Customers; who are the firm’s customers
2. Product or services; What are the firms’ major product & services
3. Markets; Geographically where does the firm compete
4. Technology; is it technologically current
5. Concern for survival, growth, and profitability; Is it committed to growth &
6. Philosophy; what are the basic beliefs, values, aspirations, & ethical priorities of
7. Self concept; What is the firm’s distinctive competence or major competitive
8. Concern for public image; Is the firm responsive to social, community &
9. Concern for employees; are employees a valuable asset of the firm.
Some Further Characteristics
Usually broad in scope for two reasons(rigidity resisting change vs creativity
Leads to generation of a range of alternative objectives & strategies
without unduly stifling management creativity which is due to excess
specificity. Overly general statement could result in dysfunctional
strategies.(e.g. apple computers diversifying into pesticides, ford into food
To effectively reconcile differences among important stake holders .e.g.
general pubic interested in social responsibility & stock holders in
profitability. All claims on an organization can’t be pursued with equal
emphasis, mission statement indicates relative priority to be given.
Define what the organization is & what it aspires to be
Broad to allow creativity & limited enough to exclude some ventures
distinguish it from others
serve as a frame work for evaluating both current & prospective activities
be clearly & simply stated to be widely understood in the entire organization
Reflects the anticipations of customers & identify the utility of products to
customer. E.g. AT&T focuses on communication & not on telephones, Universal
studios on entertainment rather than movies, e.g. offering clothes vs. attractive
Recommended length less than 200 words.
Gives the message that the business is being conducted in socially responsible
way, responsibilities towards, consumers, environmentalists, minorities, ,
communities & other groups. Engage in activities having economic benefits. E.g.
Merck developed & distributed free of cost river blindness drug ivermectin
Arouses a positive feeling & motivates readers to action.
Creates impression that firm is successful has direction & is worthy of time,
support & investment
Provides useful criteria for selecting among alternate strategies.
Mission Statement of
Pepsi:- to increase the value of our shareholders’ investment. We do this through
sales growth, cost controls, & wise investment resources. We believe our commercial
success depends upon offering quality & value to our consumers & customers;
providing products that are safe, wholesome, economically efficient, &
environmentally sound; & providing a fair return to our investors while adhering to
the highest standards of integrity
Dell:- 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 &
company accountability, best in class service & support; flexible customization
capability; superior corporate citizenship[; financial stability
The Bellevue Hospital (BH)
The BH is the leader in providing resources necessary to realize the community’s highest
level of health throughout life
The BH , with respect, compassion, integrity & courage, honors the individuality &
confidentiality of our patients, employees, & community, & is progressive in anticipating
& providing future health care services
John Deere(JD), Inc
JD is committed to providing genuine value to the Company’s stake holders, including
our customers, dealers, shareholders, employees & communities. In support of that
commitment, Deere aspires to
Grow & pursue leadership positions in each of our businesses
Extend our preeminent leadership position in the agriculture equipment market
Create new opportunities to leverage the John Deere brand globally
JD has grown & prospered through a longstanding partnership with the world’s most
productive farmers. Today, JD is a global company with several equipment operations &
complementary service businesses. These businesses are closely interrelated, providing
the company with significant growth opportunities & other synergistic benefits.