Chapter two - Business Vision and Mission Statements
- 1. CHAPTER TWO-BUSINESS VISION AND MISSION STATEMENTS Admas University
- 2. Outline Vision Statement • Features of effective vision statement • Importance(Purpose) of vision statement development Mission Statement • Components of Mission Statement • Importance of Mission Statement development
- 3. Development of Vision & Mission Strategy Formulation Identifying External Opportunities & Threats Identifying Internal Strengths & Weaknesses Establishing Long-Term Objectives Generating Alternative Strategies Choosing particular strategies. 3 Strategy formulation is the development of long-range plans for the effective management of environmental opportunities and threats, in light of internal strengths and weaknesses.
- 4. Vision statement is often considered the first step in strategic planning It is the desired future state of an organization. An aspirational description of what an organization would like to achieve or accomplish in the future Vision is used to set out a 'picture' of an organization in the future. Vision Statement
- 5. The vision statement answers the question, “Where do we want to go?” “What do we want to become?” In short, vision statement; is a statement about an organizational long-term direction; hope for the reality to be While a vision statement doesn’t tell you how you’re going to get there, it does set the direction for your business planning. A clear vision provides the foundation for developing a comprehensive mission statement. Vision…..Cont’d
- 6. Features of an effective vision statement include: It is usually short, concise and preferably limited to one sentence Clarity and lack of ambiguity Vivid and clear picture of future Memorable and engaging wording Realistic aspirations Alignment with organizational values & cultures To become really effective, an organizational vision statement must become assimilated into the organization's culture. An effective vision statement is inspirational. A vision statement should challenge and inspire employees. Vision…..Cont’d
- 7. • Leaders have the responsibility of :- Communicating the vision regularly; Acting as role models by embodying the vision; ♥Creating short-term objectives compatible with the vision; and ♥Encouraging others to construct their own personal vision compatible with the organization's overall vision. Vision…..Cont’d
- 8. Some examples of vision statements are: Our vision is to be the world’s best quick service restaurant. (McDonald’s) Be the global leader in convenient foods and beverages by winning with purpose.(PepsiCo) General Motors’ vision is to be the world leader in transportation products and related services. EAL- To become the most competitive and leading aviation group in Africa by providing safe, market driven and customer focused passenger and cargo transport, aviation training, flight catering, MRO and ground services by 2025 Addis Ababa University aspires to be ranked among the top ten pre-eminent African graduate and research universities in 2023.(AAU) Revised Vision: Become a world class university and the leading research university in East Africa.(AAU) In as much as Mount Dashen excels all other mountains in Ethiopia, Dashen Bank continues to prove unparalleled in banking services(Dashen Bank) United Bank’s vision is to be “the Preferred Bank” National Bank of Ethiopia is to be one of the strongest and most reputable central banks in Africa. Awash Bank’s vision is “to be the most Preferred Bank of the People” CBE’s vision is “ To Become a World-Class Commercial Bank”
- 9. Purpose of Vision Shared vision is an initial force that brings people together. It provides energy and strengths to individuals. It inspires stakeholders. It helps to see what you are working towards.
- 10. ∫Mission statement-is an enduring statement of purpose that distinguishes one organization from another. ∫It is a declaration of a firm’s reason for existence. ∫It identifies scope of it operation in terms of product offered and market served. ∫Mission also means what we are and what we do. Mission Statement
- 11. ∫Mission Statements Sometimes called ∫ A creed statement, ∫ A statement of purpose, ∫ A statement of philosophy, ∫ A statement of beliefs, ∫ A statement of business principles, ∫ Or a statement “defining our business, ∫Some mission statements are complex, long, and very broad; whereas some mission statements are simple and direct. Mission Statement
- 12. In order to be effective, a mission statement should possess the following characteristics. Broad in scope; It usually is broad in scope for at least two major reasons. 1st , a good mission statement allows for the generation and consideration of a range of feasible alternative objectives and strategies without excessively stifling management creativity 2nd , a mission statement needs to be broad to reconcile differences effectively among an organization’s diverse stakeholders, the individuals and groups of individuals who have a special stake or claim on the company. Thus a mission statement should be reconciliatory. Do not include monetary amounts, numbers, percentages, ratios, or objectives, Less than 250 words in length Characteristics of a Mission Statement
- 13. Inspiring: It should be motivating members of the organization or being its customers. A Customer Orientation: A good mission statement reflects the anticipations of customers. Feasible: a mission should always aim high but it should not be an impossible statement. Precise: should not be so narrow nor should it be too broad. …Cont’d
- 14. Mission statements can and do vary in length, content, format, and specificity. Most practitioners and academicians of management consider an effective statement to exhibit/ Include nine components: • Customers, products or services, markets, technology, concern for survival/growth/profits, philosophy, self-concept, concern for public image, concern for employees • When we say concern for public image, mission statement should Reveal that the firm is socially responsible Reveal that the firm is environmentally responsible Components of a mission statement
- 16. 1) Customer: Who are the firm’s customers? 2) Products or services: What are the firm’s major products or services? 3) Markets: Geographically, where does the firm compete? 4) Technology: Is the firm technologically current? 5) Concern for survival, growth, and profitability: Is the firm committed to growth and financial soundness?
- 17. 6. Philosophy: What are the basic beliefs, values, aspirations, and ethical priorities of the firm? 7. Self-concept(Distinctive competencies): What is the firm’s distinctive competence or major competitive advantage? 8. Concern for public image: Is the firm responsive to social, community, and environmental concerns? 9. Concern for employees: Are employees a valuable asset of the firm?
- 18. Examples: We aspire to make PepsiCo the world’s premier consumer Products Company, focused on convenient foods and beverages. We seek to produce healthy financial rewards for investors as we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate. And in everything we do, we strive to act with honesty, openness, fairness and integrity. Evaluate, using the elements of mission statement.
- 19. Examples: We aspire to make PepsiCo the world’s (mkt- geog) premier consumer Products Company, focused on convenient foods and beverages(Products or services: ). We seek to produce healthy financial rewards for investors (survival, growth, and profitability) as we provide opportunities for growth and enrichment to our employees(Concern for employees), our business partners and the communities (Concern for public image ) in which we operate. And in everything we do, we strive to act with honesty, openness, fairness and integrity (Philosophy). (comment: Statement lacks three components: Customers, Technology, and Self- Concept)
- 20. EAL Mission To become the leading Aviation group in Africa by providing safe and reliable passenger and cargo air transport, Aviation Training, Flight Catering, MRO and Ground Services whose quality and price “value proposition” is always better than its competitors, To ensure being an airline of choice to its customers, employer of choice to its employees and an investment of choice to its Owner, To contribute positively to socio economic development of Ethiopia in particular and the countries to which it operates in general by undertaking its corporate social responsibilities and providing vital global air connectivity (Evaluate, using the elements of mission statement)
- 21. AAU Mission Addis Ababa University’s mission is to produce competent graduates, provide need-based community service and produce problem- solving research outputs through innovative and creative education, research and consultancy service to foster social and economic development of the country. (Evaluate, using the elements of mission statement)
- 22. Dashen Bank(DB) Mission DB is dedicated to provide efficient and customer focused domestic and international banking services by overcoming the continuous challenges for excellence through the application of appropriate technology (Evaluate, using the elements of mission statement)
- 23. United Bank(UB) Mission United Bank’s mission is to render quality commercial banking services to the best satisfaction of its customers; to enhance shareholders’ value; to be one of the best employers in the industry; and to discharge its corporate responsibility to both the community in which it operates and the environment which it shares with the world. (Evaluate, using the elements of mission statement)
- 24. CBE Mission We are committed to maximizing shareholder value through enhanced financial intermediation and unparalleled customer satisfaction. We deploy highly motivated, skilled and disciplined employees capable of providing banking products and services that meet international best practices and standards as well as state-of- the art technology . We strongly believe that reliability and public confidence are the bases of our success. (Evaluate, using the elements of mission statement)
- 25. Mission Statement Evaluation Matrix COMPONENTS Organization Customers Products Services Markets Concern for Survival, Growth, Profitability Technology EAL DB UB CBE
- 26. Mission Statement Evaluation Matrix COMPONENTS Organization Philosophy Self- Concept Concern for Public Image Concern for Employees EAL DB UB CBE
- 27. Importance of mission statements It is recommended that organizations carefully develop a written mission statement in order to reap the following benefits: To ensure Unanimity of purpose within a business venture To provide a basis for allocating resources To establish a general tone or organizational climate To serve as a focal point for individuals to identify with the organization’s purpose and direction, To facilitate the translation of objectives into a work structure involving the assignment of tasks to responsible elements within the organization To specify organizational purposes and then to translate these purposes into objectives in such a way that cost, time, and performance parameters can be assessed and controlled
- 28. Importance of Mission Statement Mission Resource Allocation Unanimity of Purpose Organizational Climate Focal point for work structure Benefits from a strong mission Facilitate translation of objective Specify organizational Purpose
- 29. End