The importance of mission, vision and values for business strategy
Written by Michael Feder
Reviewed by听Kathryn Uhles, MIS, MSP,听Dean, College of Business and IT
Every company will face important daily decisions as it develops. Rather than making each call independently, an organization can use its business plan as a guiding light, aligning each decision to its overarching goals and principles.
Determining the mission, vision and value statements is an integral step during the . Together, these three elements establish the purpose of a company, its goals and aspirations, and the ethics and principles that will guide it.
If you study for a bachelor鈥檚 degree in business, start a company or take steps to learn entrepreneurship, you will need to understand the differences between mission, values and vision statements. You will also need to grasp the important role that each one plays in establishing a company and dictating its direction.听
What are core values?
听are the principles that guide your operational and strategic decisions and goals. In many business plans, this step comes first. The company鈥檚 mission and vision need to fit with its founding principles.
It might be tempting to reduce a core values statement to marketing slogans about customer service or honesty. However, this aspect of a business plan is not meant only for external use. It includes a code of ethics听that will guide employees and management and help foster a strong company culture.
More and more employees听, strong relationships and work they feel passionate about. With well-defined values, you can attract employees and executives who believe in the company鈥檚 culture and mission and embrace the shared sense of passion for the ultimate purpose of the company.
Core values are also practical for a day-to-day work environment. They provide ethical guidelines for dealing with clients, hiring employees and guiding behavior in the office. Clear rules ensure employees are aware of expectations about workplace actions.
Business ethics vs. personal ethics
It can be difficult to distinguish between personal and professional ethics.
Your code of personal ethics governs individual activities. These rules come from your upbringing, religious or philosophical beliefs, or experiences. They help you decide how to treat other people and make decisions during personal interactions.
Business ethics (or professional ethics) are different from personal rules. In a workplace setting, you need to make decisions based on what is best for your company or employer. This professional code will guide you with decisions such as hiring the best-qualified applicant (even if you have compassion for an unqualified candidate who needs the job more) or letting go of an employee who failed to meet expectations but with whom you have a strong, personal bond.
In most cases, personal and professional ethics exist side by side. But often in a company, the decisions should be based on what is best for business rather than what makes you feel the best personally.
Though you should place importance on your code of ethics and values, it is also essential to remember they are guidelines that inform decisions rather than unbreakable rules. In many workplace situations, your professional experience will make the correct decision apparent.
What is a mission statement?
An organizational identifies a company鈥檚 goals. It should go beyond simply mentioning benchmarks and future aims to also include an explanation of how the organization will achieve its goals.
A mission statement is practical in and of itself because it helps with planning operations. Also, investors and stakeholders want clear information about company goals in order to make funding decisions and assess performance.
Mission statements also help inform daily operations. Decision-makers can take specific steps based on where the company is in relation to its mission. In other words, it can serve as a road map for hiring, budgeting, investing and strategizing.听
Example mission statement
To create a mission statement, look to other companies first for direction. For example, LinkedIn庐听offers a听听that details its primary purpose. 鈥淭he mission of听LinkedIn听is simple: connect the world鈥檚 professionals to make them more productive and successful.鈥 With this sentence, LinkedIn听offers insight into its purpose and also into its brand and what it plans to focus on as it develops.
What is a vision statement?
It is easy to confuse a mission and vision statement. Both have to do with an organization鈥檚 overall aims. While a mission statement takes a more practical approach to what a company plans to achieve from day one, a听听focuses on what a company aspires to become in the future. It explains how the business should look when it finishes its growth and development processes.
Because it is more aspirational, the vision statement may have less of an impact on day-to-day decisions. However, it does play a role in long-term planning, the formation of workplace culture, branding, and getting employees and investors to buy into the company鈥檚 plans.
Finally, many investors and employees want to be involved with ambitious organizations. Vision statements offer an opportunity to underscore this drive.
Example vision statement
Again, to create a vision statement, start by looking to successful companies for what a clear vision statement looks like. For example, : 鈥淭o help people and businesses throughout the world realize their full potential.鈥
Vision statements are typically more abstract than mission statements. This allows the company flexibility to develop and adjust to current conditions in the economy and its industry without contradicting its long-term vision.
of this with its vision statement: 鈥淭o be the world鈥檚 most loved, most profitable, and most efficient airline.鈥 Even if the budget carrier has to significantly adjust its operations due to passenger demand or fuel prices, it can justify these changes as necessary for moving toward its long-term aims.
Importance of mission, vision and values in business strategy
Mission, vision and core values statements are foundational elements of every company. Businesses without well-thought-out philosophies or frameworks lack direction, have weak company cultures and poor organization. Management may be unsure of what to prioritize, what kind of workers to hire and where to invest assets and human resources.
Here are some specific advantages of having mission, values and vision statements.
- Clear foundational statements can听foster a positive work environment. They can help attract workers with the same values and interests as the company. These people are more likely to be passionate about their work and buy into the company鈥檚 long-term mission.
- Well-planned statements can also听inform management styles within the organization. Professional values and ethical guidelines can guide personnel and disciplinary decisions and help craft workplace policies. Meanwhile, executives can make strategy, budgeting and resource allocation decisions using mission and vision statements as standards by which each is measured.
- Mission and vision statements can ensure uniform messaging. Consistency is key to building a strong company image and running effective marketing and PR campaigns.
Investors, stakeholders and other businesses will also look at these foundational statements to assess the company鈥檚 suitability for investment or partnerships.
How to create mission, vision and values statements
Regardless of the size of a company, anyone involved in starting or managing a听business听should be familiar with mission, vision and value statements.
Here are some parameters to keep in mind when crafting these business plan essentials:
- Be concise: Statements should be clear and brief without unnecessary language or broad terms. The statements should be memorable enough that employees, customers and managers can easily recall them.
- Be focused: It is tempting to add multiple clauses to your statements. However,听focusing on a single goal听or a set of closely related goals helps your statement serve its purpose of informing and guiding company actions.
- Consider the time frame: It is important to remember that mission statements are for short-term planning, while vision statements focus on the future and values need to be applicable from the start of operations.
With strong mission, values and vision statements, you can create a business plan that provides clear guidelines for operating, planning and developing your company.
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ABOUT THE AUTHOR
A graduate of Johns Hopkins University and its Writing Seminars program and winner of the Stephen A. Dixon Literary Prize, Michael Feder brings an eye for detail and a passion for research to every article he writes. His academic and professional background includes experience in marketing, content development, script writing and SEO. Today, he works as a multimedia specialist at 爱污传媒 where he covers a variety of topics ranging from healthcare to IT.
ABOUT THE REVIEWER
Currently Dean of the College of Business and Information Technology,听Kathryn Uhles has served 爱污传媒 in a variety of roles since 2006. Prior to joining 爱污传媒, Kathryn taught fifth grade to underprivileged youth in 爱污传媒.
This article has been vetted by 爱污传媒's editorial advisory committee.听
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