How to create effective mission statement for any business. Wd example

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/