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Defogging the “Mission/Vision Thing”

Written By: J. Diezemann
Published On: May 5 2000

Defogging the "Mission/Vision Thing"
J. Diezemann & J. Dowling - May 5, 2000

The Issue

Without a clearly stated Purpose, Mission, Vision, and Values, employees, including IT professionals, lack adequate guidance and boundaries of empowerment. This lack of context is likely to result in them taking actions that are consistent with their individual 'visions' but collectively fail to maximize business value from their efforts.

The vast majority of personnel who fill corporate ranks at all levels, show up to work each day with the desire to do the right things and help make their company successful. In high-performance companies there is little confusion about what to do and why. In lower performing companies managers often work at cross-purposes because their vision of what they are contributing to is inconsistent with that of their peers.

The Path to Clarity

Purpose, Mission, Vision, and Values are the cornerstones that guide strategy creation and action. Despite their importance, there is a wide disparity among individuals' definition and their resultant response to each. Similar confusion exists with respect to their hierarchical interdependence. Confused definitions coupled with misstated, ambiguous, or non-existent statements create an environment that fosters dysfunctional, counter-productive, and unaligned or misaligned behavior.

In his recent article Built to Flip, published in Fast Company Magazine, Built to Last author Jim Collins captures such misalignment with the following observation:

"We can all point to companies that should have viewed themselves as "Built not to last." Confronting that reality would have helped them understand that they were never more than a project, a product, or a technology. Lotus, VisiCorp, Netscape, Syntex, Coleco -- all of these companies would have served themselves and the world better if they had accepted their limited purpose from the outset. Ultimately, they squandered time and resources that might have been applied more efficiently elsewhere."[1]

Collins' reference to "squandered time and resources that might have been applied more efficiently elsewhere," is a classical representation of what we recognize as organizational misalignment; where energy and resources expended are not synergistic and not contributing fully to the goals of the company. Collins is highlighting that it is extremely important for a company to have a crystal clear understanding of what it is about and where it is going. In most companies this is assumed to be addressed by the Mission/Vision, but the problems surrounding the domain of mission and vision are three-fold:

  • The determination of exactly what constitutes a valid or appropriate mission, vision, strategy, etc. is incredibly foggy. You can place 10 books by supposed gurus side by side and have differing interpretations of what these elements should look and sound like, as well as their hierarchical interdependence.

  • Many companies duck the truly hard work of defining these elements by creating platitudinal statements, loaded with "generic goodness," that offer neither guidance nor inspiration.

  • When these elements are highly ambiguous or left undefined, individuals within the company will fill the gap by "making it up." When these elements are misstated, intentionally or unintentionally, in a manner where what is stated does not reflect true intent, it lays the groundwork for dysfunctional and counter-productive behavior.

This analysis will sort through much of the confusion, leverage some of the better thinking that exists on the subject and lay out a framework for defining a high-level organizational context that establishes direction and guidance to enable aligned action.

Figure A depicts the hierarchical relationship among the drivers of change in any organization. This analysis will focus on the upper 5 levels of the Organizational Context Pyramid spanning from a company's purpose to its strategy. The lower, and much more dynamic, portion of the Organizational Context Pyramid will be covered in greater depth in a future note.

Figure A:

 

Establish Direction

 

Pyramid Level
Definition
Purpose
  • Why does the company exist?

  • Does it stand for something (beyond profits)?
Mission
  • In general terms it describes what business(es) the company is in.

  • It describes the company's distinctive value proposition, what differentiates it from competitors

  • It describes what the company will do, what benefits it will deliver, to whom and to what extent.

  • It provides a critical success premise that leaders can understand, commit to, and dramatize to others[2].
Vision
  • It paints a compelling and inspirational picture of where the company will be (an ideal state) at some future date (when), intimating how the company will look, feel and be.

 

Purpose, Mission & Vision lie at the pinnacle of the Organizational Context Pyramid. They are intended to establish a "true north" for the company as well as provide inspiration for its employees. They are relatively stable and change infrequently. They may remain intact, relevant and consistent for decades.

Purpose

In their book 'Jumping the Curve, Innovation and Strategic Choice in an Age of Transition,' authors Nicholas Imparato and Oren Harari state:

"Thirty years ago Peter Drucker advised executives to ask the question: What business are we in? Today we can up the ante by challenging leaders and organizations to choose what they stand for. To say that an organization "stands for" profits says nothing at all. Yes, every organization needs profits just like every body needs food but it is as absurd to say that the purpose of an organization is to make money as it is to say that the purpose of a human being is to eat or breath."[3]

Many companies fail to isolate purpose as a singular statement, or believe that it is inferred within the Mission Statement. Sometimes as well, the company purpose may be inferred from a company motto or from the words of a founder or Chief Executive. Sometimes they are written, often the are not. Failure to explicitly isolate a Purpose weakens the communication of a company's essence and works against employee empowerment. What is important is that there is shared understanding of these concepts across the company.

Beyond making money and creating shareholder value, companies are frequently created for other (and sometimes less than obvious) purposes:

  • Outdoor gear manufacturer Patagonia exists to use business to inspire and implement solutions to the environmental crisis.

  • Ben & Jerry's is dedicated to the creation & demonstration of a new corporate concept of linked prosperity.

  • The founding prospectus for the company that would become Sony Corporation cited the primary motive for its creation (in post-war Japan): "To create a stable work environment where engineers who had a deep and profound appreciation for technology could realize their societal mission and work to their hearts content." The second of several Purposes of Incorporation was "To reconstruct Japan and elevate the nations culture through dynamic technological and manufacturing activities."[4]

  • Bose Corporation founder Amar Bose once stated, "Research is the reason we exist." The company's slogan "Better Sound through Research" was consistent with corporate activities. The company has always done research and product development outside of Sound, but for many years it has been the focus of product development. Only when choosing the words for a marble-inlay for the foyer of its new company headquarters building did the Purpose of the company reveal itself to be "Better Products Through Research" a much less confining statement that initially, caused a good deal of confusion.

 

Mission

The examples of Purposes given above talk mainly to the "why we exist" question, but most say little about the business itself. Whereas many texts intermix Purpose with Mission, a clear definition of Mission that compliments a standalone Purpose was presented by George A. Steiner in his book 'Strategic Planning':

"Mission statements identify the underlying design, aim or thrust of a company Missions should be stated at least in both product and market terms Mission statements, aside from providing general guides for strategic planning, have specific relevance to the formulation of program strategies and the nature of a business. Mission statements determine the competitive arena in which a business operates.... they make it much easier the task of identifying the opportunities and threats that must be addressed in the planning process. They open up new opportunities, as well as new threats when changed. They prevent people from "spinning their wheels" in working on strategies and plans that may be considered completely inappropriate by top management."[5]

In effect, the Mission of a company begins to define "What business we're in, what we'll do, for whom and to what extent." Beyond "Purpose" which states the companies reason for being, the Mission Statement, at a high level, starts to scope out the space in which the company will compete, which may be further clarified in terms of product types, customer types, geography, etc. Mission statements provide focus, but they do not state how the goals of the company will be accomplished.

The following are some mission statements that reflect this level of abstraction:

  • The Salvation Army: is a worldwide evangelical Christian church, human service agency and non-profit corporation. Its message is based on the Bible. Its ministry is motivated by the love of God. Its mission is to preach the gospel of Jesus Christ and to meet human needs in His name without discrimination.

  • Deluxe Checks: To provide all banks, S&L's and investment firms with error-free financial instruments delivered in a timely fashion. Error-free means absolutely no errors; timely means a 48-hour turnaround.

  • Otis Elevator: To provide any customer a means of moving people and things up, down and sideways over short distances with a higher reliability than any similar enterprise in the world.

Management should be able to look to the Mission Statement first to assess the appropriateness of possible courses of action. These actions must be assessed for compatibility with the mission. For a business that is clearly established as a retailer, starting a consumer financing division is apparently far afield from the retail business, but the appropriateness of such a move would be heavily influenced by the company's Mission. If their mission was tightly focused retail (i.e., resale of consumer products), then such a move would likely be inappropriate. But, if their Mission is to meet the needs of a certain consumer segment (i.e., provide consumer goods to middle income Americans), then the action is not necessarily inconsistent. A Statement of Purpose is a backstop should the Mission Statement fail to cover the issue.

There will be times when a Mission must be revisited and redefined. This often happens when an organization is undergoing radical transformation, stimulated by a significant external event such as deregulation, new regulations and/or the advent of e-commerce. In these cases, the organization frequently must adopt an entirely new business model and a re-crafted Mission.

Vision

A vision statement can serve as the most powerful motivator at leaderships' disposal. Vision describes "Where and When" - It paints a compelling picture of the company at some future point in time. Many people cite President Kennedy's challenge to land a man on the moon, and bring him safely back alive before the end of the decade as a classic example of "a vision." In his statement there was no question as to where we were going, and when this must be achieved by. With this vision firmly implanted, the focus and energy of all parties involved immediately moved down a level in the Organizational Context Pyramid, to begin strategizing "how to make it happen."

Financial software developer Intuit's "Vision for 2010" (available on it's web site) is remarkably bold in that it discusses the businesses and industries that they will be in, their position within them and their reputation. It describes the legacy that they've created (at this future point in time) from servicing customers with a focus on quality; balance between "evolution and revolution" that drives the products that they've created; products have become an integral part of the daily lives of their customers.

While leaving plenty of room for the influence of unknown variables, they have painted a detailed and compelling picture of a destination point in the future. Managers can truly evaluate the plans and strategies they are developing to assess whether they get the company closer to realizing their vision.

During a 1999 speech announcing the Windows CE operating system for portable devices, Microsoft Chairman Bill Gates announced that Microsoft would be revising its original vision of 'a PC in every home and on every desk,' inferring that this context was limiting in a world that is seeing explosive growth of portable devices. "This is the first time in our 25-year history we've actually changed our vision statement," said Gates. This is a classic example of how a Vision Statement must be periodically revisited and revised to reflect new and previously unforeseeable change drivers impacting the business. It also gives Microsoft employees the empowerment to explore opportunities in new areas that previously would have appeared to be inconsistent with the stated direction of the company.

Vision is what propels a company forward, even in the face of discouraging odds. If it is compelling and meaningful, individuals will embrace it on a personal level and go to great lengths to make it happen. Every employee of a company should be able to talk to it and about it, and explain how their daily activities contribute to its realization. If they cannot, then the vision probably hasn't been developed at the right level of abstraction, or management has not developed a compelling case.

Guidance & Boundaries

Pyramid Level
Definition
Core Values
  • A set of deeply held beliefs that unify and inspire employees.
  • Define how employees see themselves and their employers.
  • The ideals, customs, institutions, etc., of a society toward which the people of the group have an affective regard.[6]
  • Establish behavioral norms for the company.
Strategy
  • How a business will win in its industry, utilizing its finite resources to differentiate itself positively from its competitors, maximizing its relative strengths against the forces at work in the business environment to satisfy customer needs and move forward towards vision realization.

With organizational context and direction firmly established through the definition of Purpose, Mission and Vision, the focus turns to achieving desired outcomes. Without constraints, there would be virtually infinite possibilities. But in reality, constraints exist; they can be voluntary (as defined by values) or practical, forced by limited resources (which must be dealt with via strategy). Values and Strategy offer important guidance for determining the path that the company should pursue at the present time based upon its knowledge about itself and its environment.

Core Values

Values guide choices. They describe many of the qualitative aspects of life within the organization on a day-to-day basis, and they frequently describe what is truly important to the company. Values can be written or unwritten, but everyone knows they exist. Virtually all aspects of a company's culture are inextricably linked to its collective and individual value system(s). Articulating values provides everyone with guiding lights, ways of choosing among competing priorities and guidelines about how people will work together.

Shared Values are of particular importance at the executive leadership level, not only because employees look to their behaviors for clues as to whether stated values are still valid but also because values cannot be acted upon directly. Executive leadership controls the systems and structures such as competency models and reward systems that must change if there is going to be a shift in corporate values. If the systems and structures do not shift, there will be no shift in values and corresponding behaviors. In their book Results-Based Leadership, Ulrich, Zenger & Smallwood cite a link between values and results:

"Leaders who understand their company's and their personal values build lasting results. In the Tylenol-tampering incident, Johnson & Johnson executives were willing to absorb short-term reduced investor results because of their overriding commitment to producing ethical drugs. Lacking clear values, rudderless leaders shift from goal to goal. With values, while actions may change, the overall direction and focus stay clear."[7]

Strategy

Strategy is how the company commits to a certain path of action based upon its understanding of where it wants to be (Vision), the dynamics of the external business environment (including competitor actions, the shifts in technology, the shifts in demographics, consumer behaviors, politics, etc.), and the internal change forces.

Strategy is how the company determines the actions it must take in the marketplace and how it will allocate finite resources to them This then places immediate demand to deploy and/or create operational capabilities for strategy realization. With this level of directional definition, a company can establish milestones and metrics to propel it towards the realization of its vision.

Hamel and Prahalad provide an example of a rich Strategy in their article Strategic Intent, where they discussed how Honda Motor Corp. pursued its Vision of becoming "the second Ford," by first establishing itself as a major player in the U.S. motorcycle market:

"When Honda took on leaders in the motorcycle industry it began with products that were just outside the conventional definition of the leaders' product-market domains. As a result, it could build a base of operations in underdefended territory and then use that base to launch an expanded attack. What many competitors failed to see was Honda's strategic intent and its growing competence in engines and power trains. Yet even as Honda was selling 50cc motorcycles in the U.S., it was already racing larger bikes in Europe - assembling the design skills and technology it would need for a systematic expansion across the entire spectrum of motor-related businesses."[8]

Conclusion

Purpose, Mission, Vision, and Values clarify thinking about what is important and set the tone for actions that will produce business value. We have seen many instances where companies become separate camps as a result of a lack of clarity in these areas, as well as cases where Purpose, Mission, Vision, and Values are clear but the senior executives refuse to commit to them. We have also seen the negative impacts of conflicts between stated Purpose, Mission, Vision, and Values and those held in the boardroom.

On the other hand it is quite rare to find a case where clarity of Purpose, Mission, Vision, and Values had anything other than a positive impact on a company's long-term performance, as the directional context for effective strategy has been established.

A future note will complete the analysis of the Organizational Context Pyramid, probing deeper into Strategy and the rapid alignment cycles that must exist between Strategy and action.

Bibiliography

[1] Collins, Jim. "Built to Flip." Fast Company Magazine, Issue 32, 1999, Pg. 131.

[2] Albrecht, Karl. The Northbound Train, New York: AMACOM, 1994, Pg. 20.

[3] Imparato, Nicholas and Harari, Oren, Jumping the Curve, San Francisco: Jossey-Bass Inc., 1994, Pg. 205.

[4] "SONY: About Sony: History." About Sony. Sony Corporation, 4 April 2000.
http://www.world.Sony.com/CorporateInfo/History/prospectus.html

[5] Steiner, George A., Strategic Planning, New York: Free Press, 1979, Pg. 156. [6] "Meaning of Value." www.Infoplease.com. 7 April 2000.
http://www/Infoplease.com/ipd/A0723808.html

[7] Ulrich, Dave, Zenger, Jack and Smallwood, Norm. Results-Based Leadership, Boston: Harvard Business School Press, 1999, Pg. 47.

[8] Hamel, Gary and Prahalad, C.K., Strategic Intent, Harvard Business Review, May-June 1989, Pg. 70.

 
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