{"id":52,"date":"2014-05-13T17:44:26","date_gmt":"2014-05-13T17:44:26","guid":{"rendered":"http:\/\/opentextbc.ca\/strategicmanagement\/?post_type=chapter&p=52"},"modified":"2019-06-26T23:03:05","modified_gmt":"2019-06-26T23:03:05","slug":"vision-mission-and-goals","status":"publish","type":"chapter","link":"https:\/\/opentextbc.ca\/strategicmanagement\/chapter\/vision-mission-and-goals\/","title":{"raw":"Vision, Mission, and Goals","rendered":"Vision, Mission, and Goals"},"content":{"raw":"
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Learning Objectives<\/p>\r\n\r\n<\/header>\r\n

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  1. Define vision and mission and distinguish between them.<\/li>\r\n \t
  2. Know what the acronym SMART represents.<\/li>\r\n \t
  3. Be able to write a SMART goal.<\/li>\r\n<\/ol>\r\n<\/div>\r\n<\/div>\r\n

    The Importance of Vision<\/h1>\r\n
    Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.\r\n\r\n\u2014Jack Welch, former CEO of General Electric<\/blockquote>\r\nMany skills and abilities separate effective strategic leaders like Howard Schultz from poor strategic leaders. One of them is the ability to inspire employees to work hard to improve their organization\u2019s performance. Effective strategic leaders are able to convince employees to embrace lofty ambitions and move the organization forward. In contrast, poor strategic leaders struggle to rally their people and channel their collective energy in a positive, focused direction.\r\n\r\nAs the quote from Jack Welch suggests, a [pb_glossary id=\"2588\"]vision[\/pb_glossary]<\/strong>\u00a0is one key tool available to executives to inspire the people in an organization (Figure 2.2 \"The Big Picture: Organizational Vision\"<\/a>). An organization\u2019s vision describes what the organization hopes to become in the future. Well-constructed visions clearly articulate an organization\u2019s aspirations. Google\u2019s mission is to organize the world\u2019s information and make it universally accessible and useful (Edwards, 2012). Google expands on its mission by listing \u201cTen things we know,\u201d including \"Focus on the user and all else will follow,\" \"It\u2019s best to do one thing really, really well,\" and\u00a0\u00a0\"Fast is better than slow\" (Google Inc., 2014).<\/a>\r\n\r\n[caption id=\"attachment_819\" align=\"aligncenter\" width=\"400\"]\"Examples<\/a> Figure 2.2 The Big Picture: Organizational Vision [Image description]<\/a>[\/caption]This brief but powerful statement emphasizes several aims that are important to Google, including excellence in customer service, and setting high standards for employees and Google\u2019s products. McDonald\u2019s brand mission is \"to be our customers\u2019 favourite place and way to eat. Our worldwide operations are aligned around a global strategy called the Plan to Win, which centre on an exceptional customer experience \u2013 People, Products, Place, Price and Promotion. We are committed to continuously improving our operations and enhancing our customers\u2019 experience.\"\u00a0 To be effective, this mission statement must filter down to all employees and inspire them to adopt that mission. (Edwards, 2012).\r\n\r\nOne limitation of such all-encompassing goals is that front line and operational employees will not relate or connect with the goals, and will disengage from the process \u2013 flavour of the month\u2026. The CEO\/management team who can effectively translate the high-level objectives to on-the-ground activities will have good success in engaging staff!\u00a0Of course, a strong element of walk-the-talk is required by management as well.\r\n\r\nThe results of a survey of 1,500 executives illustrate how the need to create an inspiring vision creates a tremendous challenge for executives. When asked to identify the most important characteristics of effective strategic leaders, 98 percent of the executives listed \u201ca strong sense of vision\u201d first. Meanwhile, 90 percent of the executives expressed serious doubts about their own ability to create a vision.\u00a0Not surprisingly, many organizations do not have formal visions. Many organizations that do have visions find that employees do not embrace and pursue the visions. Having a well-formulated vision that employees embrace can therefore give an organization an edge over its rivals.\r\n

    Mission Statements<\/h1>\r\nAt WestJet, Clive Beddoe and his team developed its mission statement: \u201cTo enrich the lives of everyone in WestJet's world by providing safe, friendly and affordable air travel.\u201d A mission such as WestJet\u2019s states the reasons for an organization\u2019s existence. Well-written mission statements effectively capture an organization\u2019s identity and provide answers to the fundamental question \u201cWho are we?\u201d While a vision looks to the future, a mission captures the key elements of the organization\u2019s past and present.<\/a>\r\n\r\n[caption id=\"attachment_912\" align=\"aligncenter\" width=\"400\"]\"Figure<\/a> Figure 2.3: Missions [Image description]<\/a>[\/caption]Organizations need support from their key stakeholders, such as employees, owners, suppliers, and customers, if they are to prosper. A mission statement which engages\u00a0stakeholders will help develop an understanding of why they should support the organization and \u00a0make clear what important role or purpose the organization plays in society \u2013 also called a \"social license to operate.\" Google\u2019s mission, for example, is \u201cto organize the world\u2019s information and make it universally accessible and useful.\u201d Google pursued this mission in its early days by developing a very popular Internet search engine. The firm continues to serve its mission through various strategic actions, including offering its Internet browser Google Chrome to the online community, providing free email via its Gmail service, and making books available online for browsing.\r\n\r\nIn ancient times, Aesop said, \"United we stand, divided we fall.\" This provides a helpful way of thinking about the relationship between vision and mission. Executives ask for trouble if their organization\u2019s vision and mission are divided by emphasizing different domains. Some universities have fallen into this trap. Many large public universities were established in the late 1800s with missions that centered on educating citizens. As the 20th century unfolded, however, creating scientific knowledge through research became increasingly important to these universities. Many university presidents responded by creating visions centered on building the scientific prestige of their schools. This created a dilemma for professors: Should they devote most of their time and energy to teaching students (as the mission required) or on their research studies (as ambitious presidents demanded via their visions)? Some universities continue to struggle with this trade-off today and remain houses divided against themselves. In sum, an organization is more effective to the extent that its vision and its mission target employees\u2019 effort in the same direction.\r\n

    Pursuing the Vision and Mission through SMART Goals<\/h1>\r\nAn organization\u2019s vision and mission combined offer a broad, overall sense of the organization\u2019s direction. To work toward achieving these overall aspirations, organizations also need to create [pb_glossary id=\"2589\"]goals[\/pb_glossary]<\/strong>\u2014narrower aims that should provide clear and tangible guidance to employees as they perform their work on a daily basis. The most effective goals are those that are\r\n\r\nS<\/strong>pecific,\r\n\r\nM<\/strong>easurable,\r\n\r\nA<\/strong>chievable,\r\n\r\nR<\/strong>ealistic, and\r\n\r\nT<\/strong>ime-bound.\r\n\r\nAn easy way to remember these dimensions is to combine the first letter of each into one word: SMART<\/strong> (Figure 2.4 \"Creating SMART Goals\"<\/a>). Employees are in a much better \u00a0position to succeed to the extent that an organization\u2019s goals are SMART.A goal is specific <\/b>if it is explicit rather than vague. WestJet\u2019s vision is that \u201cBy 2016, WestJet will be one of the five most successful international airlines in the world providing our guests with a friendly caring experience that will change air travel forever.\u201d\r\n\r\nA goal is measurable<\/b> to the extent that whether the goal is achieved can be quantified. WestJet\u2019s goal of being one of the five most successful international airlines in the world by 2016 offers very simple and clear measurability: Either WestJet will be in the top five\u00a0\u00a0by 2016 or they will not.\r\n\r\nA goal is aggressive<\/strong>\u00a0if achieving it presents a significant (as opposed to easy) challenge to the organization. A series of research studies have demonstrated that performance is strongest when goals are challenging but attainable. Such goals force people to test and extend the limits of their abilities. This can result in reaching surprising heights.\r\n\r\nWestJet committed to growing responsibly and ensuring that it is an environmentally sustainable airline, and supports the IATA goal of carbon neutral growth in its industry beyond 2020. WestJet already operates one of the most modern and fuel-efficient fleets in North America.\r\n\r\nAchieving carbon neutral growth will be a challenge for WestJet requiring the combined efforts of the airline and its supplier partners such as aircraft manufacturers, airports and government.\u00a0 In 2012, WestJet reported that \u201cOur significant investments in fleet and technology have greatly improved our aircraft fuel efficiency and ability to operate our business more cost effectively. Between 2000 and 2012, we improved our fuel efficiency by 44.8 per cent per revenue tonne kilometre. The resulting fuel savings are equivalent to the amount of fuel that would have been used to fly a Boeing Next-Generation 737 from Calgary to Toronto and back approximately 44,135 times (based on our 2012 fuel usage).\u201d (Quigley, 1994)\r\n\r\nIt is useful to know that \u00a0easily achievable<\/b> goals are not only easy, but they tend to undermine overall motivation and effort by employees, Michelangelo said, \u201cThe greater danger for most of us lies not in setting our aim too high and falling short, but in setting our aim too low, and achieving our mark.\u201d Consider a situation in which you have done so well in a course that you only need a score of 60 percent on the final exam to earn an A for the course. Understandably, few students would study hard enough to score 90 percent or 100 percent on the final exam under these circumstances Similarly, setting organizational goals that are easy to reach encourages employees to work just hard enough to reach the goals.<\/a><\/a>\r\n\r\n[caption id=\"attachment_971\" align=\"aligncenter\" width=\"400\"]\"Figure<\/a> Figure 2.4 Creating SMART Goals [Image description]<\/a>[\/caption]It is tempting to extend this logic and thinking to conclude that setting nearly impossible goals will encourage even stronger effort and performance from staff. However, people act rationally and tend to become \u00a0discouraged and give up \u00a0when faced with goals that realistically have little chance of being reached. If, for example, Starbucks had set a time frame of one year to regain a share price of $35, it would have attracted scorn. The company simply could not be turned around that quickly. Similarly, if WestJet\u2019s fuel efficiency goal was 100 percent improvement, WestJet\u2019s employees would probably not embrace it. Thus goals must also be realistic, meaning that their achievement is feasible.\r\n\r\nMost of us have \u00a0found that deadlines are motivating and that they help you structure your work time. The same is true for organizations, leading to the conclusion that goals should be time-bound<\/b> through the creation of deadlines. WestJet has set a goal to achieve a cumulative 45 per cent improvement in fuel efficiency for our 737 fleet by 2020, as compared to the 2000 base year. (WestJet, 2012)\r\n\r\nThe period after an important goal is reached is often overlooked but is critical. Will an organization rest on its laurels or will it take on new challenges?\u00a0Starbucks provides an illustrative example. \u00a0In 2011, after a revamp of the company\u2019s stores and services, the stock price was around $35.\u00a0In early 2014, the price was in the $70 range.\r\n
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    Key Takeaway<\/p>\r\n\r\n<\/header>\r\n

    \r\n\r\nStrategic leaders need to ensure that their organizations have three types of aims. A vision states what the organization aspires to become in the future. A mission reflects the organization\u2019s past and present by stating why the organization exists and what role it plays in society. Goals are the more specific aims that organizations pursue to reach their visions and missions. The best goals are SMART:<\/strong> specific, measurable, achievable, realistic, and time-bound.\r\n\r\n<\/div>\r\n<\/div>\r\n
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    Exercises<\/p>\r\n\r\n<\/header>\r\n

    \r\n
      \r\n \t
    1. Take a look at the website of your college or university. What is the organization\u2019s vision and mission? Were they easy or hard to find?<\/li>\r\n \t
    2. As a member of the student body, do you find the vision and mission of your college or university to be motivating and inspirational? Why or why not?<\/li>\r\n \t
    3. What is an important goal that you have established for your career? Could this goal be improved by applying the SMART goal concept?<\/li>\r\n<\/ol>\r\n<\/div>\r\n<\/div>\r\n

      References<\/h1>\r\nEdwards, A.\u00a0(2012). Mission Statements--World's Top 10 Brands<\/em><\/a>.\u00a0Retrieved from http:\/\/communicatingasiapacific.com\/2012\/06\/15\/mission-statements-worlds-top-10-brands\/\r\n\r\nGoogle Inc. (2014). Ten things we know to be true<\/i><\/a>.\u00a0 Retrieved from https:\/\/www.google.com.sg\/about\/company\/philosophy\/\r\n\r\nQuigley, J. V. (1994). Vision: How leaders develop it, share it, and sustain it. Business Horizons<\/i>, 37<\/i>(5), 37\u201341.\r\n\r\nWestJet Airlines Ltd. (2012). WestJet 2012 Global Reporting Initiative report<\/i> [PDF]<\/a>. Retrieved from https:\/\/www.westjet.com\/pdf\/global-reporting.pdf\r\n

      Image descriptions<\/h1>\r\n<\/a>Figure 2.2 image description: The Big Picture: Organizational Vision.<\/strong>\r\n\r\nAn organization's vision describes what the organization hopes to become in the future. Visions highlight the values and aspirations that lay at the heart of the organization. Although vision statements have the potential to inspire employees, customers, and other stakeholders, vision statements are relatively rare and good visions are even rarer. Some of the visions being pursued by businesses today are offered below.\r\n