NSTRUCTIONS:Select ONE CHAPTER of your choice.Write a THREE PAGE REVIEW of the chapter. CITE CHAPTER & PAGEInclude the following:Key Points of the Chapter – List each Key Point in paragraph format.Provide details of the Key Points including examples, in-depth explanations,terminology and application in the workplace.Discuss what you learned that will benefit your role as Manager.Substantiate your comments using chapter information.Why would this benefit you in your job?do not forget references
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CHAP TER
4
Developing Mission, Vision,
and Values
FIGURE 4.1
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Mattel Inc.’s vision of “creating the future of play” is evidenced in the constantly evolving designs found in their
popular Hot Wheels cars.
Source: jointstar / shutterstock.com 389197510
C H A P T E R
L E A R N I N G
O B J E C T I V E S
Reading this chapter will help you accomplish the following:
1. Understand the roles of mission, vision, and values in the planning process.
2. Understand how mission and vision fit into the planning-organizingleading-controlling (P-O-L-C) framework.
3. See how creativity and passion are related to vision.
4. Incorporate stakeholder interests into mission and vision.
5. Develop statements that articulate organizational mission and vision.
6. Apply mission, vision, and values to your personal goals and professional
career.
At the organizational level, a key part of planning (the first element of the P-O-L-C framework) is captured in verbal
and written statements of an organization’s mission and vision. With a mission and vision, firms craft a strategy for
achieving their general purpose and afterward establish benchmarks for judging progress and success through
clear goals and objectives. Mission and vision communicate the organization’s values and purpose, and the best
© 2017 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved.
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PRINCIPLES OF MANAGEMENT VERSION 3.0
mission and vision statements have an emotional component that serves to incite employees and delight
customers.
FIGURE 4.2 Mission and Vision as P-O-L-C Components
1. THE ROLES OF MISSION, VISION, AND VALUES
1. Define mission and vision.
2. Appreciate how values are important for mission and vision.
3. Understand the roles of vision, mission, and values in the P-O-L-C framework.
Music Rap-Up: My Company
Twinprov perform a rap on mission, vision, and values.
Youtube
View the video online at: http://www.youtube.com/embed/f5kkWclU8_4?rel=0
1.1 Mission, Vision, and Values
values statement
A written statement that
reaffirms or states outright
the organization’s values that
might not be evident in the
mission or vision statements.
A casual tour of business or organization websites will expose you to the range of forms that mission
and vision statements can take. Mission statements answer the questions of “Who are we?” and “What
does our organization value?” Vision statements typically take the form of relatively brief, future-oriented statements—vision statements answer the question “Where is this organization going?” Increasingly, organizations also add a values statement that either reaffirms or states outright the organization’s values that might not be evident in the mission or vision statements.
Mission and vision both relate to an organization’s purpose and are typically communicated in
some written form. Mission statements answer questions about who the firm is and what they are doing. Oftentimes mission statements incorporate the firm’s values as well. An example is found in the
© 2017 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved.
Created exclusively for abdulaziz alshammari
O B J E C T I V E S
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L E A R N I N G
CHAPTER 4
DEVELOPING MISSION, VISION, AND VALUES
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outdoor clothing company Patagonia, whose mission states, “To build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”[1] A 2011
study by the consulting firm Bain and Company reports that 63% of the more than 1,000 firms surveyed globally reported using mission and values statements as a management tool.[2] Moreover, firms
with a clearly communicated, widely understood, and collectively shared mission and vision have been
shown to perform better than those without them, with the caveat that they related to effectiveness only
when strategy, goals, and objectives were aligned with vision and mission.[3]
A mission statement communicates the organization’s reason for being, and how it aims to serve
its key stakeholders. Customers, employees, and investors are the stakeholders most often emphasized,
but other stakeholders like government or communities (i.e., in the form of social or environmental
impact) may also be discussed. Mission statements sometimes include a summation of the firm’s values. Values are the beliefs of an individual or group, and in the case of organizational values, the values of the organization where members are emotionally invested.
A vision statement, in contrast to a mission statement, is a future-oriented declaration of the organization’s purpose and aspirations. In some ways, the mission statement outlines the organization’s
current “purpose for being,” and the vision statement outlines, “based on that purpose, this is what we
may one day become.” A firm’s strategy should flow directly from their vision, since the strategy is intended to achieve the vision and satisfy the organization’s mission. Typically, vision statements are relatively brief, as in the case of Starbucks vision statement, which reads: “Establish Starbucks as the
premier purveyor of the finest coffee in the world while maintaining our uncompromising principles as
we grow.”[4] Similarly, Walmart’s tag-line version of its vision statement is “Save money. Live better.”[5] A more lengthy visionary statement is found in Amazon.com, which states, “Our vision is to be
earth’s most customer centric company; to build a place where people can come to find and discover
anything they might want to buy online.”[6]
© 2017 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved.
93
mission statement
A statement of purpose,
describing who the company
is and what it does.
Values
Shared principles, standards,
and goals.
vision statement
A future-oriented declaration
of the organization’s purpose
and aspirations.
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PRINCIPLES OF MANAGEMENT VERSION 3.0
© 2017 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved.
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Source: http://www.flickr.com/photos/cherrysweetdeal/4322582205; Data retrieved from http://www.starbucks.com/aboutus.
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FIGURE 4.3
CHAPTER 4
DEVELOPING MISSION, VISION, AND VALUES
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FIGURE 4.4 Missions
Source: Images courtesy of Ketchen, D., & Short, J. (2011). Mastering strategic management. Irvington, NY: Flat World Knowledge; Evb-wiki,
http://en.wikipedia.org/wiki/File:Evb-my_hog.jpg (first); Internal Revenue Service, http://en.wikipedia.org/wiki/File:IRS.svg (second); Jeff Wilcox,
http://www.flickr.com/photos/jeffwilcox/1882938710/ (third); Dwight Burdette, http://en.wikipedia.org/wiki/
File:Victoria%27s_Secret_at_Briarwood_Mall.JPG (fifth); other images © Thinkstock.
© 2017 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved.
95
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PRINCIPLES OF MANAGEMENT VERSION 3.0
http://www.flickr.com/photos/dph1110/2672793430/ (third from the top); bfishadow, http://www.flickr.com/photos/bfishadow/3458254707/ (fourth
from the top); Thinkstock and Like_the_Grand_Canyon, http://www.flickr.com/photos/like_the_grand_canyon/2406679678/, http://www.flickr.com/
photos/like_the_grand_canyon/4945749010/ (fifth from the top); Scott Ehardt, http://en.wikipedia.org/wiki/File:Crest_toothpaste.jpg (bottom); other
images © Thinkstock.
1.2 The Role of Mission and Vision
Mission and vision statements play three critical roles: (1) communicate the purpose of the organization to stakeholders, (2) inform strategy development, and (3) develop the measurable goals and objectives by which to gauge the success of the organization’s strategy.
© 2017 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved.
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Source: Images courtesy of Ketchen, D., & Short, J. (2011). Mastering strategic management. Irvington, NY: Flat World Knowledge; David Herrera,
Created exclusively for abdulaziz alshammari
FIGURE 4.5
CHAPTER 4
DEVELOPING MISSION, VISION, AND VALUES
First, mission and vision provide a vehicle for communicating an organization’s
purpose and values to all key stakeholders. Stakeholders are those key parties who have
some influence over the organization or stake in its future. Some key stakeholders are
employees, customers, investors, suppliers, and institutions such as governments. Typically, mission and vision statements are widely circulated and discussed often so that
their meaning is widely understood, shared, and internalized. The better employees understand an organization’s purpose, through its mission and vision, the better able they
will be to understand the strategy and its implementation.
Second, mission and vision create a target for strategy development. That is, one
criterion of a good strategy is how well it helps the firm achieve its mission and vision.
The best vision statements create a tension and restlessness with regard to the status
quo—that is, they should foster a spirit of continuous innovation and improvement.
London Business School professors Gary Hamel and C. K. Prahalad describe this tense
relationship between vision and strategy as stretch and ambition. Indeed, a study of
such able competitors as CNN, British Airways, and Sony found that these firms displaced competitors with stronger reputations and deeper pockets through their ambition to stretch their organizations in more innovative ways.[7]
Third, mission and vision provide a high-level guide, and the strategy provides a
specific guide, to the goals and objectives showing success or failure of the strategy and
satisfaction of the larger set of objectives stated in the mission. Such objectives include
profitability goals, metrics on customer and employee satisfaction, and social and environmental responsibility measures.
97
FIGURE 4.6
Founded by Anita Roddick, the mission of The
Body Shop explicitly includes a broad
understanding of stakeholders by providing a
commitment “to the well-being of our fellow
humans and the preservation of the planet.”
Source: http://www.flickr.com/photos/homard/417370634/
FIGURE 4.7
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Virgin Galactic provides an example of a company that embraces the ambitious vision of providing suborbital space
flights to eager tourists.
Source: http://en.wikipedia.org/wiki/File:Spaceship_One_in_flight_1.jpg
K E Y
T A K E A W A Y
Mission and vision relate to an organization’s purpose and aspirations, and are typically communicated in brief
written statements. A mission statement communicates the organization’s reason for being and how it serves
its key stakeholders. The vision statement is a narrower, future-oriented declaration of the organization’s purpose and aspirations. Together, mission and vision guide strategy development, help communicate the organization’s purpose to stakeholders, and inform the goals and objectives set to determine whether the strategy is
on track.
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PRINCIPLES OF MANAGEMENT VERSION 3.0
D I S C U S S I O N
Q U E S T I O N S
1.
2.
3.
4.
Do you feel it is important for organizations to have mission statements? Why or why not?
Is a vision statement as important as or less important than a mission statement? Explain your answer.
How are values important to the content of mission and vision statements?
What happens if an organization’s mission and vision statements do not seem sincere? How might this
affect an organization?
5. How do mission and vision relate to a firm’s strategy?
6. In what ways are mission and vision important for organizational goals and objectives?
2. MISSION AND VISION IN THE P-O-L-C FRAMEWORK
L E A R N I N G
O B J E C T I V E S
2.1 Mission, Vision, and Organizing
organizational culture
A system of shared
assumptions, values, and
beliefs showing people what
is appropriate and
inappropriate behavior.
Organizing
The function of management
that involves developing an
organizational structure and
allocating human resources
to ensure the
accomplishment of
objectives.
organizational design
A formal, guided process for
integrating the people,
information, and technology
of an organization.
Organizational culture is the workplace environment formulated from the interaction of the employees
in the workplace. Organizational culture is defined by the collective life experiences, strengths, weaknesses, education, upbringing, and other attributes of the employees. While executive leaders play a
large role in defining organizational culture by their actions and leadership, all employees contribute
to the organizational culture.
Organizing is the function of management that involves developing an organizational structure
and allocating human resources to ensure the accomplishment of objectives. The organizing facet of
the P-O-L-C framework typically includes subjects such as organization design, staffing, and organizational culture. The alignment between the mission and vision has implications for various organizing
activities. For instance, organizational design is a formal, guided process for integrating the people,
information, and technology of an organization. It is used to match the form of the organization as
closely as possible to the purpose(s) the organization seeks to achieve. Through the design process, organizations act to improve the probability that the collective efforts of members will be successful.
To organize, managers must connect people with each other as well as with information and technology in meaningful and purposeful ways to allow the success of such key human resources. Organization structure defines the formal relationships among people and specifies both their roles and their
responsibilities. Administrative systems govern the organization through guidelines, procedures, and
policies. Each part of the organization should support (or at the least, not conflict with) each of the others, and together they must support the organization’s purpose, as reflected in its mission and vision.
© 2017 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved.
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Mission and vision play a prominent role in the planning dimension of the P-O-L-C framework. Mission and vision are also related to the organizing, leading, and controlling aspects as well. In this section, we describe each of these relationships.
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1. Understand the role of mission and vision in organizing.
2. Understand the role of mission and vision in leading.
3. Understand the role of mission and vision in controlling.
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CHAPTER 4
DEVELOPING MISSION, VISION, AND VALUES
99
For example, in 2006, Disney acquired Pixar, a firm renowned for its creative
prowess in animated entertainment. Disney summarizes the Pixar strategy like this: FIGURE 4.8
“Pixar’s [strategy] is to combine proprietary technology and world-class creative talent
Pixar’s creative prowess is reinforced by
to develop computer-animated feature films with memorable characters and heart- Disney’s organizational design choices leading
[8]
warming stories that appeal to audiences of all ages.”
Disney has helped Pixar to successful offerings, such as the Academy
achieve this strategy through an important combination of structural design choices. Award–winning film Up.
First, Pixar is an independent division of Disney and is empowered to make independent choices in all aspects of idea development. Second, Pixar gives its “creatives”—its
artists, writers, and designers—great leeway over decision making. Third, Pixar protects
its creatives’ ability to share work in progress, up and down the hierarchy, with the aim
of making it even better. As a result, innovations gained through new projects can be
shared with later projects, while sharing knowledge about potential pitfalls at the same
time. [9] Such acquisitions can pose challenges when different companies have their
own unique cultures, but evidence seems to suggest that Disney has a strength in navigating this difficult process. For example, more recently, Disney acquired Lucasfilm; this
acquisition will allow for the integration of the Star Wars empire into the Disney family
with new movies directed by J.J. Abrams as well as cartoons such as Star Wars: Rebels
shown on the Disney network geared at a younger audience. [10] Further integration Source: http://en.wikipedia.org/wiki/File:John_Lasseterby Disney will appear in its parks as well as Star Wars theme parks to further leverage Up-66th_Mostra.jpg
the added value of the acquisition. [11]
Organizational culture is the workplace environment formulated from the inOrganizational culture
teraction of the employees in the workplace. Organizational culture is defined by all the life experiA system of shared
ences, strengths, weaknesses, education, upbringing, and other attributes of the employees. While execassumptions, values, and
utive leaders play a large role in defining organizational culture by their actions and leadership, all embeliefs showing people what
ployees contribute to the organizational culture.
is appropriate and
Achieving alignment between mission and vision and organizational culture can be very beneficial
inappropriate behavior.
to firms, but one potential downside is that organizational culture is also difficult to change. Consequently, a firm’s ability to change the organization’s culture to support those new directions may be
difficult, or, at least, slow to achieve.
For instance, in 2000, Procter & Gamble (P&G) sought to change a fundamental part of its vision
in a way that asked the organization to source more of its innovations from external partners. Historically, P&G had invested heavily in research and development and internal sources of innovation—so
much so that “not invented here” (known informally as NIH) was the dominant cultural mind-set.[12]
NIH describes a culture that avoids using products, research, or know-how that originated anywhere
other than inside the organization. It is normally used in a negative sense. As a sociological phenomenon, the “not invented here” syndrome is manifested as an unwillingness to adopt an idea or product because it originates from another culture. P&G has been able to combat this NIH bias by adopting a fiveyear stretch goal that at least 50% of their initiatives will include an external collaboration and moving
to a hybrid research and development (R&D) structure that balances local focus and headquarters
oversight.[13] P&G was gradually able to change its culture toward one that is more open to external
contributions, and therefore in much better alignment with its current mission and vision.
2.2 Mission, Vision, and Leading
Leading involves influencing others toward the attainment of organizational objectives. Leading and
leadership are nearly synonymous with the notions of mission and vision. A very purposeful person is
often described as being “on a mission.” And the success of many top leaders and entrepreneurs flows
from their personal mission. Oprah Winfrey, for example, holds a personal mission, “To be a teacher.
And to be known for inspiring my students to be more than they thought they could be.”[14] Such a belief has led to successes in journalism, acting, television, netw …
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