Why Mission Statements Are Still The Key To Business Success

Why Mission Statements are still the key to business success

As long as there have been businesses, there have been mission statements. A clear, punchy, concise declaration of a business s purpose. They often include outlining the company s goals and guiding values and can often be alongside, or amalgamated with a vision statement - the forward looking statement which essentially describes what will happen if the mission statement is achieved. lt;/p>For example, Tesla s vision statement is "To create the most compelling car company of the 21st century by driving the world`s transition to electric vehicles." The end goal is to create the most compelling car company in the world. Their mission statement however, how they re going to get to their vision, is to accelerate the world s transition to sustainable energy .

Whilst the specific format of a mission statement varies from one company to another, it can be anything from simply describing what the company does, such as Procter Gamble who state Our mission is to provide branded products and services of superior quality and value that improve the lives of the world s consumers, now and for generations to come. This mission is a clear and succinct statement about their purpose - provide high quality products that benefit customers.

It can focus on who its customers are and how they will service them like the American fashion retailer Nordstrom who state our mission is to provide outstanding service every day, one customer at a time showing their commitment to delivering an exceptional customer experience and building relationships with each individual customer.

Or the mission statement can simply state how the business aims to achieve its objectives, such as Google with Our mission is to organise the world`s information and make it universally accessible and useful. We achieve this by developing innovative technologies, fostering a culture of creativity and collaboration, and maintaining a relentless focus on user experience.

They can also, like Tesla s above, be focused on the values and aspirations of the business. lt;/p>Why does a business need a mission statement?

A mission statement is a critical tool for defining the purpose and objectives of a business and importantly communicating this to their employees, shareholders, customers and many other key stakeholders. It serves as a guide that helps shape the company`s strategy, culture, and decision-making processes, ultimately with the aim of contributing to its long-term success and sustainability.

Defines Purpose and Direction: A mission statement articulates the fundamental purpose and direction of the business. It communicates why the business exists, what it aims to achieve, and how it intends to do so. This clarity of purpose helps align the efforts of employees, stakeholders, and partners towards common goals.

Guides Decision-Making: A mission statement serves as a guiding framework for decision-making within the business. It helps leaders and employees prioritise initiatives, allocate resources, and evaluate opportunities by ensuring alignment with the company`s core values and objectives. This consistency ensures that actions and decisions are in line with the overall mission.

Inspires and Motivates: A well-crafted mission statement inspires and motivates employees by providing a sense of purpose and meaning in their work. It communicates the company`s values, aspirations, and vision for the future, fostering engagement, commitment, and a sense of belonging among employees. A compelling mission statement can also attract and retain top talent who share the company`s values and goals.

Differentiates from Competitors: A unique mission statement helps distinguish the business from its competitors by highlighting its unique value proposition, priorities, and goals. It communicates to customers, investors, and partners what sets the business apart and why they should choose to engage with it. A strong mission statement can enhance brand identity and positioning in the market.

Accountability and Transparency: A mission statement promotes accountability and transparency within the organisation by setting clear expectations and standards of behaviour. It provides a benchmark against which performance can be measured and evaluated, enabling stakeholders to assess the company`s progress towards its goals and hold it accountable for its actions.

What influences a business s mission statement?

A business`s mission statement is influenced by a combination of internal factors such as the founder s vision, organisational culture and strategic goals, as well as external factors such as market conditions, stakeholder expectations, and social and environmental trends. By considering these influences, companies can develop mission statements that effectively communicate their purpose, values, and aspirations to stakeholders.

Founder`s Vision: The vision and values of the company`s founders often play a significant role in shaping the mission statement. The founders` beliefs, values and aspirations for the organisation can serve as guiding principles that inform the mission statement. For example Patagonia s founder Yvon Chouinard, a passionate environmentalist, made their mission statement to "Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis. which shows his commitment to his business but also his wider goals of environmental sustainability. lt;/p>Organisational Culture: The culture of the organisation including its values, norms, and beliefs can influence the development of the mission statement. Companies with a strong culture of innovation, customer focus, or social responsibility, for example, may incorporate these values into their mission statement.

Market Conditions: The competitive landscape, industry trends and market conditions can also influence a business`s mission statement. Companies may craft mission statements that reflect their strategic priorities, differentiation strategies or response to market opportunities and challenges.

Stakeholder Expectations: The expectations and preferences of key stakeholders, including customers, employees, investors and communities can influence the content and tone of the mission statement. Companies may seek to align their mission statement with the interests and values of their stakeholders to build trust and credibility. For example the pharmaceutical giant Johnson Johnson state right at the start of their mission statement We believe our first responsibility is to the doctors, nurses and patients, to mothers and fathers and all others who use our products and services immediately relating their mission to one of their key stakeholder groups, their customers.

Social and Environmental Trends: Growing concerns about social and environmental issues such as sustainability, diversity and inclusion, and corporate responsibility, can shape a business`s mission statement. Companies may incorporate language related to these issues into their mission statement to demonstrate their commitment to making a positive impact on society and the environment. For example the British FMCG business Unilever reads "Our purpose is to make sustainable living commonplace. We believe this is the best long-term way for our business to grow. Our vision is to grow our business, whilst decoupling our environmental footprint from our growth and increasing our positive social impact." clearly showing their commitment to corporate social responsibility and sustainability.

Strategic Goals and Objectives: A business`s strategic goals and objectives can influence the development of its mission statement. Companies may craft mission statements that align with their long-term vision, strategic priorities and growth aspirations, providing a roadmap for achieving their strategic objectives.

In conclusion, mission statements serve as the compass guiding organisations towards their objectives. They instil clarity and purpose among stakeholders as well as fostering a culture of accountability with employees. By articulating the business s values and aspirations, mission statements inspire action and drive progress towards achieving a company s ultimate goals.

Elliott

Teacher of Business

TOPICS:

Mission statements

Vision statements

Decision making

Motivation

Internal and External Factors

Organisational culture

Stakeholders