1. Chapter 2
The Business Vision & Mission
Strategic Management:
Concepts & Cases
10th Edition
Fred David
PowerPoint Slides by
Va Siheng, MBA.
National University of Management
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2. Chapter Outline
• Value
• Vision statement
• Mission statement
• Goal and objective
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3. “Management’s job is not to see
the company as it is….but as it
can become.”
John W. Teets
“Quote”
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4. I-Corporate Values
• Corporate values are the underlying principles
which guide and also drive the actions and
activities of individual companies.
– A set of principles that further clarifying
what we stand for.
– A compass for individual and collective
behavior.
– A clarification of what we are prepared to
be judged on by audiences.
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5. I-Corporate Values
Each company or organization has their own set
of values.
• “Heart and Soul” of the organization
– Performance
– Reputation
• Endure throughout the life of the organization.
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6. Developing a Corporate Values
• Question: What values or beliefs
do you want to represent your
company?
• Facilitator selected top managers and
key personnel to complete values
form.
• Brainstorming Exercise
• Final agreement by consensus on the
best values to represent company.
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7. VALUES SELECTION FORM
Accountability Innovation Social
Responsibility
Commitment Leadership Speed
Creativity Loyalty Teamwork
Customer Service Multi-Cultural Technology
Dependability Partnership Transparency
Equality Privacy Trust
Entrepreneurial Progressive Unique
Excellence Quality Other Values:
Freedom Reliability
Honesty Safety
Source: William Bean, Strategic Planning That Makes Things Happen, p. 101.
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8. Important values
Customers
Management & Employees
Living values
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9. II- Vision statement
Agreement on the basic vision for which the
firm strives to achieve in the long run is
critically important to the firm’s success.
“What do we want to
become?”
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11. Vision & Mission
Many organizations develop both vision &
mission statements.
Vision statement--
• Should be established first and foremost
• Short – preferably one sentence
• Broad management involvement
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12. Vision Statement Examples
National Pawnbrokers Association: “The
Vision of the National Pawnbrokers Association
is to have complete and vibrant membership
that enjoys a positive public and political image
and is the focal organization of all pawn
associations”.
-- National Pawnbrokers Association
(npa.ploygon.net)
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13. Vision Statement Examples
The Bellevue Hospital: “Is the LEADER in
providing resources necessary to realize the
community’s highest level of HEALTH
throughout life”.
-- U.S POULTRY & EGG Association
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14. III- Mission statement
-- 90% of all companies have used a mission
statement in the previous five years.
“What is our business?”
•Enduring statement of purpose
•Distinguishes one firm from another
•Declares the firm’s reason for being
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15. Mission Statements
Also referred to as:
•Creed statement
•Statement of purpose
•Statement of philosophy
•Statement of business principles
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16. Mission Statements
Reveal what an organization wants to
be and whom it wants to serve
Essential for effectively establishing
objectives and formulating strategies.
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17. Vision & Mission
Many organizations develop both vision &
mission statements.
It can be argued that
profit, not mission or
vision.
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18. Vision & Mission
Profit & vision are necessary to effectively
motivate a workforce
Shared Vision --
– Creates commonality of interests
– Reduce daily monotony
– Provides opportunity & challenge
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19. Developing Vision & Mission
Clear mission is needed before alternative
strategies can be formulated and
implemented
Participation from diverse
managers is important in
developing the mission.
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20. Developing Vision & Mission
Approach to developing --
– Select several articles about vision or
mission
– Read as background information
– Ask to prepare a draft statement
– A facilitator merge into document
– Request for modifications, Additions,
and deletions
– Revise the document
• Reach final agreement by consensus on
vision or mission of the company.
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21. Mission Statement Examples
The Bellevue Hospital, with respect, compassion,
integrity, and courage, honors the individuality
and confidentiality of our patients, employees,
and community, and is progressive in
anticipating and providing future health care
services.
-- The Bellevue Hospital
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22. Mission Statement Examples
Microsoft: “Since its inception in 1975,
Microsoft’s mission has been to create
software for the personal computer that
empowers and enriches people in the
workplace, at school and at home.”
Coca-Cola: “As the world’s largest beverage
company, we refresh the world. We do this by
developing superior soft drinks, both
carbonated and non-carbonated, and profitable
non-alcoholic beverage systems that create
value for our company, our bottling partners
and our customers.”
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23. Importance of Mission
Benefits from a strong mission
Unanimity of Purpose
Resource Allocation
Mission
Organizational Climate
Focal point for work
structure
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24. Effective Missions
Broad in scope
Broad in scope
Generate strategic
Generate strategic
alternatives
alternatives
Not overly specific
Not overly specific
Reconciles interests among
Reconciles interests among
diverse stakeholders
diverse stakeholders
Finely balanced between
Finely balanced between
specificity & generality
specificity & generality
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25. Effective Missions
Arouse positive feelings &
Arouse positive feelings &
emotions
emotions
Motivate readers to action
Motivate readers to action
Generate favorable
Generate favorable
impression of the firm
impression of the firm
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26. Effective Missions
Reflect future growth
Reflect future growth
Provide criteria for strategy
Provide criteria for strategy
selection
selection
Basis for generating &
Basis for generating &
evaluating strategic options
evaluating strategic options
Are dynamic in nature
Are dynamic in nature
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27. Mission & Customer
Orientation – Vern McGinnis
• Define what the organization is
• Define what it aspires to be
• Limited to exclude some ventures
• Broad enough to allow for growth
• Distinguishes firm from all others
• Stated clearly – understood by all
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29. Vision & Mission
Research results are mixed, however,
firms with formal mission statements --
• 2x average return on shareholder’s equity
• Positive relationship to company
performance
• 30% high return on certain financial
measures
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30. Products
Services Markets
Customers
Technology
Mission
Employees
Elements
Survival
Growth
Profit
Public
Image
Self-Concept Philosophy
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31. PepsiCo Mission
PepsiCo’s mission is to increase the value of our
shareholders’ investment. We do this through
sales growth, cost controls, and wise investment
resources. We believe our commercial success
depends upon offering quality and value to our
consumers and customers; providing products
that are safe, wholesome, economically efficient
and environmentally sound; and providing a fair
return to our investors while adhering to the
highest standards of integrity.
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32. Ben & Jerry’s Mission
Ben & Jerry’s mission is to make, distribute and
sell the finest quality all-natural ice cream and
related products in a wide variety of innovative
flavors made from Vermont dairy products. To
operate the Company on a sound financial basis
of profitable growth, increasing value for our
shareholders, and creating career opportunities
and financial rewards for our employees. To
operate the Company in a way that actively
recognizes the central role that business plays in
the structure of society by initiating innovative
ways to improve the quality of life of a broad
community—local, national and international.
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33. Mission Statement Evaluation
Matrix
COMPONENTS
Concern
for
Survival,
Products Growth,
Organization Customers Services Markets Profitability Technology
PepsiCo Yes No No Yes No
Ben & Jerry's No Yes Yes Yes No
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34. Mission Statement Evaluation
Matrix
COMPONENTS
Self- Concern for Concern for
Organization Philosophy Concept Public Image Employees
PepsiCo Yes No No No
Ben & Jerry's No Yes Yes Yes
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35.
THE AEROSPACE CORPORATION
-- VISION --
To be the world's leader in the application of space technology.
-- MISSION --
To apply our technical knowledge and expertise to enable our
customers to successfully exploit the full potential of space and
space technology.
-- VALUES --
Integrity - Technical Excellence - Objectivity
Dedication to Mission Success - Commitment to Our People.
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36. NORTHWEST AIRLINES
The VISION of Northwest Airlines : To build together the world's most
preferred airline with the best people; each committed to exceeding our
customers' expectations every day.
Our MISSION: The people of Northwest Airlines will provide reliable,
convenient and consistent air transportation that meets or exceeds
customer expectations and earns a sustainable profit.
Our VALUES: Northwest has eight essential values or standards that
Northwest people are expected to uphold.
Safety first
Honesty and integrity
Trustworthiness
Respect for self, others and for property
Caring
Resourcefulness and innovation
Commitment to profitability
Enthusiasm and camaraderie
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37. Summary Values, Vision, Mission
• The reason for preparing Values, Vision and
Mission statements is to provide a sense of
purpose and direction for the organization
which is much greater than simply making a
profit.
• Once completed, these statements should
be shared with the company’s management,
employees and primary customers.
• These statements should also serve to both
motivate and guide the actions of the
company’s managers and employees.
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38. IV-Goals and Objectives
• Goals and objectives are statements
focusing on “what” the company or
organization wants to do, accomplish or
achieve.
• Strategies are the methods or actions
necessary to achieve or accomplish goals
and objectives.
• Goals and objectives can have:
Short-term range (1 year or less);
Intermediate term range (1 to 2 years);
Long-term range (2 to 5 years or more);
• Strategic goals/objectives have a long term
range.
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39. Goals & Objectives
• It is important to note that for some people,
goals and objectives are slightly different.
– Some people define “goals” as being
general statements (usually long-term) of
what a company wants to do or accomplish,
while defining “objectives” as specific
statements (usually short-term).
• We can therefore use the terms strategic goals
or strategic objectives in an equivalent or
interchangeable manner.
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40. Goals/Objectives should be SMART
• Specific
• Measurable
• Attainable
• Results-Oriented
• Time-Limited
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41. Areas for Strategic Goals
1.19 Areas for Objectives
Areas in Which to
Set Objectives
• Prof it abilit y
• Ef f iciency
• Grow t h
• Shareholder w ealt h
• Ut ilizat ion of resources
• Reput at ion
• Cont ribut ions t o em ployees
• Cont ribut ions t o societ y
• Market leadership
• Technological leadership
• Survival
• Personal needs of m anagem ent
Prentice Hall, 2000 Chapter 1 19
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42. Benchmarking
• The benchmarking process can help to
facilitate the formulation of strategic
goals /objectives.
• Benchmarking is a process of identifying
best practices in specific areas in
organizations both within and outside of an
industry for the purpose of matching or
exceeding them.
• After monitoring the performance of industry
competitors and outsiders, challenging
strategic goals/objectives can be set which
seek to rival or surpass main competitors in
regards to key strategic areas.
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43. Conclusion
• Strategic goals/objectives are not formulated
in isolation from the general environment.
• The internal and external audits, which are
the focus of the next lesson, have an impact
on the quantitative and qualitative aspects of
long term goals.
• In other words, strategic goals/objectives are
set and periodically revised in relation to the
firms existing strengths and weaknesses and
external opportunities and threats.
• Strategic management is very much a
dynamic process.
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