also gotta walk the walk.
Money categorizes you. Values define you.
Chapter 4
Charting the Proper Course
IN THIS CHAPTER
In Chapter 3 we show you how to create your vision statement. That exercise is focused on the aspirational aspects of your business. When done right, it allows you to define a future that comes from the heart, inspiring your co-workers as well as customers, suppliers, and just about everyone else in your stakeholder network to act in a manner that reflects the core values of your organization. Now it’s time to fire up those brain cells and get down to the specifics of just what you plan to do in the here and now that will bring in the customers and light up the cash register.
This is done through your mission statement. You probably already have a pretty good idea of what you want your business to become. But how do you make your idea a reality? You start by defining the business activities that your company plans to engage in, the goals that you expect to meet, and the ways in which you’re going to measure success.
In this chapter, we help you create a basic overview of your company and its activities, and we guide you as you shape your expectations into a mission statement. We introduce business goals and objectives and show you how to use them to measure the results that you expect to achieve. And we help you prepare to set your company’s goals and objectives and look at how you can use them to improve the overall efficiency and effectiveness of your future business.
Creating Your Company’s Mission Statement
Mission statements originally were associated with religious or military organizations, but they began to catch on with business types when the U.S. government declared a mission to the moon in the 1960s. Mission Impossible became a big TV hit around the same time, and viewers began to understand how an explicit description of what an organization did would benefit everyone involved. The public sometimes was (and is) not quite sure of just what a firm does (“Dad… is General Dynamics some military guy in Greece?”). Perhaps even company insiders needed a better explanation of just why they were there and what they were expected to do.
More and more companies, in fact, post their mission statements for everyone to see. Some companies put mission statements in their brochures and even on their letterheads. Almost all now include them prominently on company websites. In fact, you can do an online search for the name of almost any business, large or small, using terms like “mission statement,” and you’re likely to find what you’re looking for.
What many companies are finding out is that a mission statement can be a powerful tool to communicate the economic purpose of the business to people both inside and outside the organization. It establishes who you are and what you do.
Highlight your company’s business activities, including the markets that you serve, the geographic areas you cover, and the products and services you offer.
Emphasize what your company does that sets it apart from every other business out there.
Include the major accomplishments that you anticipate achieving over the next few years.
Convey what you have to say in a clear, concise, informative, and interesting manner (a little inspiration doesn’t hurt, either).
Getting started
A mission statement doesn’t need to be long. In fact, the shorter it is, the better. Even so, the task of creating one can seem impossibly daunting — the Mount Everest of business-planning chores, right up there with that vision thing we encounter in Chapter 3. One reason is that a mission statement has to sum up some pretty grand ideas in a few sentences. Another is that writing a mission statement requires business planners to ask themselves some fundamental questions — and come up with solid answers. And don’t forget, your mission statement should closely reflect the values and vision you set for your company.
In other words, a mission statement answers the basic questions first posed long ago by the famed business guru Peter Drucker:
What business are you in? Who is your customer?
When you conscientiously create a mission statement, you’ll find yourself drilling into the core of your business. Take this example: Home construction toolmaker firms like DeWalt or Makita offer drill bit products to the DIYers who finally gets around to fixing that creaking railing on the back deck. They’re the customers, and the business purpose is the manufacture of metal alloy bits for electric drills — right? Nope. What do these weekend warriors really want? A hole! The drill bit itself is merely a means to an end. Perhaps there’s a looming new laser technology out there that might get the hole-creation task done more efficiently. And the real customer might be the person demanding that the fix-it job finally gets done. If you see yourself only as a shaper and twister of metal for those with lots of nasty little cuts and scrapes on their hands and arms, you’ll likely miss potential competitive threats and focus your marketing efforts on the wrong target.
By understanding the business you’re really in and the customer who truly drives the purchase decision, the firm can address its markets and their needs in a way that better informs the realities they face and decisions they make. A good mission statement will capture this.
Which customers or groups of customers do you plan to serve?
What products or services do you plan to provide?
What needs do you want to satisfy?
How will your company’s products differ from competing offerings?
What extra value or benefits will customers receive when they choose your company over the competition?
