Strategic Direction: Vision, Mission, Values Chapter 3

Learning Objectives How vision and mission statements provide effective strategic direction. Process for developing vision statement. Steps in developing effective mission statement. Techniques for communicating vision and mission. How principles and values can lead to superior performance.

Need for Coordination and Coherence Many different departments and functions Many levels from executives down to workers Employees desire work to be meaningful Different perspectives on the company and the market Differences of opinion throughout the organization Many ways of approaching the market

Strategy Planning Hierarchy

Guiding Statements Vision Mission Principles What we want the company to become Mission How the company competes in the present Principles The moral and ethical foundations for the conduct of the company's business activities (both internal and external)

Practice in Fortune 500 Companies % Using Mission statement 33 Vision statement 18 Principles or Values statement 27 MVP – all three statements 5 (Source: West, 2014)

Possible Reasons for Low Usage Diversification – many business units Complexity of developing statements Often involving entire company Requires deep understanding, making choices, and commitment to focus Indirect connection with performance

Continuity with the Present Vision Statement Incorporate foresight Provides an "event horizon" Connects with current capabilities Incorporates enduring values Is short Is memorable Image of the Future Continuity with the Present Useful

Memorable Visions Rubbermaid, 1990 JFK, 1961 "Aisle of Rubbermaid" in every store JFK, 1961 "Put a man on the moon and return him safely to earth" Jeff Bezos, Cadabra.com, 1994: "Biggest bookstore" in the world

Developing the Vision What do we hold to be true & meaningful, factors that should never change? Why is our work meaningful? 10 years from now, what will we be proud of? What are we particularly good at doing? What compelling changes & opportunities should we seek to take advantage of? Where will we be in 10 years?

Mission Statement Captures immediate purpose of the company and its unique way of fulfilling that purpose Short Simple Company specific Actionable Measurable

Poor Mission Statement "Guided by relentless focus on our five imperatives, we will constantly strive to implement the critical initiatives required to achieve our vision. In doing this, we will deliver operational excellence in every corner of the Company and meet or exceed our commitments to the many constituencies we serve. All of our long-term strategies and short-term actions will be molded by a set of core values that are shared by each and every associate." (Grocery Store Chain) Short ? Simple ? Company Specific ? Actionable ? Measurable ?

Statement of Principles (Values) Increasingly expected by stakeholders Usually articulates beliefs of senior management Challenge is for employees to internalize espoused values Each principle must be defined & explained Management must regularly & continuously reinforce the principles, in word and deed

BB&T Principles "10 core values represent our over-arching beliefs. Values provide the context for how we make decisions. Values enable us, as individuals, to live, be successful and achieve happiness. At BB&T, our values enable us to achieve our mission and corporate purpose."

Comprehensive Example Our Vision To be the model for physician-led health care in America Our Mission To be your Medical Home Our Values As a physician owned and directed company, we are committed to ensuring that patient care is patient centered, safe, equitable, effective, efficient, and timely