Lecture Three

Vision & Mission

Analysis (Chapter 5)

Ch 5 -1
Understanding is more important than
memorization.
Prof. Feynman
(American theoretical physicist)

Ch 5 -2
 Learning Objectives
 5-1. Describe the nature and role of vision statements in strategic
management.
 5-2. Describe the nature and role of mission statements in strategic
management.
 5-3. Discuss the process of developing a vision and mission
statement.
 5-4. Discuss how clear vision and mission statements can benefit
other strategic-management activities.
 5-5. Describe the characteristics of a good mission statement.
 5-6. Identify the components of mission statements.
 5-7. Evaluate mission statements of different organizations and
write effective vision and mission statements.

Ch 5 -3
Ch 5 -4
Notable Quotes
"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 and purpose of the organization
makes possible clear and realistic business objectives."
—Peter Drucker

"A corporate vision can focus, direct, motivate, unify, and even excite a business into superior
performance. The job of a strategist is to identify and project a clear vision."
—John Keane

"Where there is no vision, the people perish."

—Proverbs 29:18

"The last thing IBM needs right now is a vision. (July 1993)
“What IBM needs most right now is a vision. (March 1996)"
—Louis V. Gerstner Jr., CEO, IBM Corporation

"That business mission is so rarely given adequate thought is perhaps the most important
single cause of business frustration."
—Peter Drucker

Ch 5 -5
Vision
 When the set of beliefs about a business at its inception is put into
writing, the resulting document mirrors the same basic ideas that
underlie vision and mission statements.
 As a business grows, owners or managers find it necessary to revise the
founding set of beliefs, but those original ideas usually are reflected in
the revised statements of vision and mission.
 It is especially important for managers and executives in any organization
to agree on the basic vision that the firm strives to achieve in the long
term.
 A clear vision provides the foundation for developing a comprehensive
mission statement.
 Shared vision creates a commonality of interests that can lift workers
out of the monotony of daily work and put them into a new world of
opportunity and challenge.

Ch 5 -6
Vision

“What do we want to become?”

Ch 5 -7
Company aims to develop innovative technologies and
efficient processes to enter new territories, improve people’s
lives, and carry on as a leader in the digital platform.

Ch 5 -8
Vision

PepsiCo’s responsibility is to continually improve all

aspects of the world in which we operate—
environment, social, economic—creating a better
tomorrow than today.

What is the issue with this vision statement?

Ch 5 -9
Ch 5 -10
Vision Statement Examples
Google
“To provide access to the world’s information
in one click.”
Disney
“To make people happy.”
Nike
“To bring inspiration and innovation to every
athlete* in the world. ”
(“If you have a body, you are an athlete.” – Bill Bowerman
(founder of Nike))
Ch 5 -11
Vision

Clear Business
Vision

Comprehensive
Mission Statement

Ch 5 -12
Mission Statement

 Answers the question:

 “What is our business?”

Ch 5 -13
 Mission Statement
 Drucker believes that asking the question “What is our
business?” is synonymous with asking “What is our
mission?”
 An enduring statement of purpose that distinguishes
one organization from other similar enterprises
 A declaration of an organization’s “reason for being”
 It answers the pivotal question “What is our business?”
 A clear mission statement is essential for effectively
establishing objectives and formulating strategies.

In a recent study, researchers concluded that 90 percent of all companies have used a mission
statement sometime in the previous five years. Barbara Bartkus, Myron Glassman, and Bruce McAfee, “Mission
Statements: Are They Smoke and Mirrors?” Business Horizons (November–December 2000): 23.

Ch 5 -14
Mission Statements are also called

 Creed statement
 Statement of purpose
 Statement of philosophy
 Statement of beliefs
 Statement of business principles
 A statement “defining our business”

A mission statement is a declaration of attitude and

outlook. Ch 5 -15
Mission Statement Examples

Proctor & Gamble provides branded

products and services of superior quality
and value that improve the lives of the
world’s consumers. As a result, consumers
reward us with industry leadership in sales,
profit, and value creation, allowing our
people, our shareholders, and the
communities in which we live and work to
prosper.

Ch 5 -16
Ch 5 -17
Vision & Mission

 Great benefits can be achieved if

an organization
 Systematically revisits their vision and
mission statement
 Treats them as living documents

 Considers them to be an integral part

of the firm’s culture

Ch 5 -18
Vision & Mission

Shared vision creates a community of

interests

Ch 5 -19
Developing Vision & Mission

Participation by as many managers as

possible is important in developing the
mission because through involvement
people become committed to an
organization

Ch 5 -20
Steps to Developing Vision &
Mission Statements
1. Have managers read related articles
2. Have managers prepare a vision and
mission statement for the organization
3. Merge the documents into one and
distribute
4. Gather feedback from managers
5. Meet to revise the final document
Ch 5 -21
Benefits of Mission Statements
 Better financial results

 Unanimity of purpose

 Resource allocation

 Establishment of culture

 Focal point for individuals

 Establishment of work structure

 Basis of assessment and control

 Resolution of divergent views

BusinessWeek reports that firms using mission statements have a 30 percent
higher return on certain financial measures than those without such statements;
however, some studies have found that having a mission statement does not
directly contribute positively to financial performance.
Ch 5 -22
Ch 5 -23
Vision & Mission Statements
 Provide unity of direction
 Promote shared expectations
 Consolidate values
 Project a sense of worth and intent
 Affirm the company’s commitment to
responsible action
According to Drucker, the most important time to ask seriously, “What do we
want to become?” and “What is our business?” is when a company has been
successful: Success always obsoletes the very behavior that achieved it,
always creates new realities, and always creates new and different problems.
Only the fairy tale story ends, “They lived happily ever after.”
Ch 5 -24
Mission & Customer Orientation

 An effective mission statement:

 Anticipates customer needs
 Identifies customer needs

 Provides product/service to satisfy

needs
 Identifies the utility of a firm’s products

to its customers
Ch 5 -25
 Products or
Services Markets
Customers

Mission Technology
Employees Components

Survival,
Growth,
Public Profits
Image
Self-Concept Philosophy

Ch 5 -26
Ch 5 -27
SZABIST Vision & Mission 2015

Ch 5 -28
 SZABIST Vision & Mission 2015

Vision Statement revised for 2016 onwards

 
SZABIST aims to be a globally recognized institute for excellence
in education, research, development, and distinction in service.
 

Mission Statement revised for 2016 onwards

 SZABIST is committed to produce highly qualified professionals

to:
 meet national and global contemporary needs;
 conduct cutting edge research and development;
 provide hi-tech scientific and technological expertise;
 meet current and future socio-economic challenges;
 meet global citizenship responsibility.

Ch 5 -29