Strategic Management

Unit 2: Strategic Planning

 Organizational Goals

The Roles of Mission, Vision, and

Values
 Mission, Vision, and Values

Mission and vision both relate

to an organization’s purpose and
are typically communicated in
some written form. Mission and
vision are statements from the
organization that answer
questions about who we are,
what do we value, and where
 Mission, Vision, and Values

A mission
statement communi-cates the
organization’s reason for being,
and how it aims to serve its key
stakeholders. Customers,
employees, and investors are the
stakeholders most often
emphasized, but other
 Mission, Vision, and Values

the form of social or

environmental impact) can also
be discussed. Mission statements
are often longer than vision
statements. Sometimes mission
statements also include a
summation of the firm’s
values. Values are the beliefs of
 Mission, Vision, and Values

the organization, in which they

are emotionally invested. The
Starbucks mission statement
describes six guiding principles
that, as you can see, also
communicate the organization’s
values:
 Mission, Vision, and Values

1. Provide a great work environment

and treat each other with respect
and dignity.
2. Embrace diversity as an essential
component in the way we do
business.
• 3. Apply the highest standards of
excellence to the purchasing,
 Mission, Vision, and Values

4. Develop enthusiastically satisfied

customers all of the time.
5. Contribute positively to our
communities and our environment.
6. Recognize that profitability is
essential to our future success.
Retrieved October 27, 2008, from
[Link]
 Mission, Vision, and Values

Similarly, Toyota declares its

global corporate principles to be:
1. Honor the language and spirit
of the law of every nation and
undertake open and fair
corporate activities to be a good
corporate citizen of the world.
 Mission, Vision, and Values

2. Respect the culture and customs

of every nation and contribute to
economic and social development
through corporate activities in the
communities.
3. Dedicate ourselves to providing
clean and safe products and to
enhancing the quality of life
 Mission, Vision, and Values

4. Create and develop advanced

technologies and provide
outstanding products and services
that fulfill the needs of customers
worldwide.
5. Foster a corporate culture that
enhances individual creativity and
teamwork value, while honoring
mutual trust and respect between
 Mission, Vision, and Values

6. Pursue growth in harmony with the

global community through innovative
management.
7. Work with business partners in
research and creation to achieve
stable, long-term growth and mutual
benefits, while keeping ourselves
open to new partnerships. Retrieved
October 27, 2008, from
 Mission, Vision, and Values

A vision statement, in
contrast, is a future-oriented
declaration of the organization’s
purpose and aspirations. In many
ways, you can say that the
mission statement lays out the
organization’s “purpose for
being,” and the vision statement
 Mission, Vision, and Values

this is what we want to

become.” The strategy should
flow directly from the vision,
since the strategy is intended to
achieve the vision and thus
satisfy the organization’s
mission. Typically, vision
statements are relatively brief,
 Mission, Vision, and Values

vision statement, which

reads: “Establish Starbucks as
the premier purveyor of the
finest coffee in the world while
maintaining our uncompromising
principles as we grow.” Retrieved
October 27, 2008, from
[Link] Or ad firm
 Mission, Vision, and Values

vision as “an agency defined by

its devotion to brands.”
Retrieved October 27, 2008,
from [Link]
. Sometimes the vision statement
is also captured in a short tag
line, such as Toyota’s “moving
forward” statement that appears
 Mission, Vision, and Values

customers, suppliers, and

employ-ees. Retrieved October
27, 2008, from
[Link]
.Similarly, Wal-Mart’s tag-line
version of its vision statement is
“Save money. Live better.”
Retrieved October 27, 2008,
 Mission, Vision, and Values

Any casual tour of business or

organization Web sites will
expose you to the range of forms
that mission and vision
statements can take. To reiterate,
mission statements are longer
than vision statements, often
because they convey the
 Mission, Vision, and Values

Mission statements answer the

questions of “Who are we?” and
“What does our organization
value?” Vision statements
typically take the form of
relatively brief, future-oriented
statements—vision statements
answer the question “Where is
 Mission, Vision, and Values

Increasingly, organizations also

add a values statement which
either reaffirms or states outright
the organization’s values that
might not be evident in the
mission or vision statements.
Roles Played by Mission and Vision

Mission and vision statements

play three critical roles: (1)
communicate the purpose of the
organization to stakeholders, (2)
inform strategy development,
and (3) develop the measurable
goals and objectives by which to
gauge the success of the
 Roles Played by Mission and Vision

strategy. These interdependent,

cascading roles, and the
relationships among them, are
summarized in the figure.
Figure 4.5 Key Roles of Mission and Vision
 First, mission and vision
provide a vehicle for
communicating an organization’s
purpose and values to all key
stakeholders. Stakeholders are
those key parties who have some
influence over the organization
or stake in its future. You will
You will learn more about
stakeholders and stakeholder
analysis later in this chapter;
however, for now, suffice it to
say that some key stakeholders
are employees, customers,
investors, suppliers, and
institutions such as
ments would be widely circulated
and discussed often so that their
meaning is widely understood,
shared, and internalized. The
better employees understand an
organization’s purpose, through
its mission and vision, the better
able they will be to understand
tegy and its implementation.
Second, mission and vision
create a target for strategy
development. That is, one
criterion of a good strategy is
how well it helps the firm achieve
its mission and vision. To better
understand the relationship
it is sometimes helpful to
visualize them collectively as a
funnel. At the broadest part of
the funnel, you find the inputs
into the mission statement.
Toward the narrower part of the
funnel, you find the vision
the mission in a way that it can
guide the development of the
strategy. In the narrowest part of
the funnel you find the strategy
—it is clear and explicit about
what the firm will do, and not do,
to achieve the vision. Vision
bridge between the mission and
the strategy. In that sense the
best vision statements create a
tension and restlessness with
regard to the status quo—that is,
they should foster a spirit of
continuous innovation and
case of Toyota, its “moving
forward” vision urges managers
to find newer and more
environmentally friendly ways of
delighting the purchaser of their
cars. London Business School
professors Gary Hamel and C. K.
ship between vision and strategy
as stretch and ambition. Indeed,
in a study of such able
competitors as CNN, British
Airways, and Sony, they found
that these firms displaced
competitors with
their ambition to stretch their
organizations in more innovative
ways. Hamel, G., & Prahalad, C.
K. (1993, March–April). Strategy
as stretch and leverage. Harvard
Business Review.
 Third, mission and vision
provide a high-level guide, and
the strategy provides a specific
guide, to the goals and
objectives showing success or
failure of the strategy and
satisfaction of the larger set of
the cases of both Starbucks and
Toyota, you would expect to see
profitability goals, in addition to
metrics on customer and
employee satisfaction, and social
and environmental responsibility.
 Thank you…

That ends our topic for this day.

See you next time for the continuation of our lesson.

Sir Knap