Unit 7 Business Strategies

Lecture 01 - Strategic contexts and terminology missions, visions, objectives, goals, core competencies (P1)

What is mission statement?

A mission statement is a role, or purpose, by which an organization intends to serve its stakeholders. It describes what the organization does (current capabilities), who it to serve (stakeholders), and what makes the organization unique (justification for existence). Mission statements always exist at the top level of an organization, but may also be set for different organizational levels or components. A mission statement is simply an organization's reason for existing.

What does mission statement do?

It tells a companys stories and ideals in less than 30 seconds. It provides the focus on the main business activities If it is written well, it can help reduce clutter in other documents and processes. It can be described as The best way to make a fire with two sticks is to make sure one of them is a match.

Missions
For developing missions of any project or organisation, the following two questions answers should be written: 1. What are we going to do? 2. How are we going to do it

Examples of mission statement

Farm fresh company To become the number one produce store in Main Street by selling the highest quality, freshest farm produce, from farm to customer in under 24 hours on 75% of our range and with 98% customer satisfaction

What is a Vision Statement?

Vision statement identifies where the organization intends to be in the future or where it should be to best meet the needs of stakeholders. Incorporates a shared understanding of the nature and purpose of the organization and uses this understanding to move the organization toward a greater purpose. It is a businesss guiding image of success. Destiny is not a matter of chance, but of choice. Not something to wish for, but to attain.

Why do we need vision?

Vision statement is a tool to inspire and provide a sense of direction and purpose. A vision provides the fabric for working together and accomplishing our goals. A good vision statement will help when there are no clear answers, or for critical decisions that will fundamentally impact your products or services. Control your destiny or someone else will!

What makes a good vision statement?

It would be short, simple and powerful. Remember a vision is meant to inspire, has an emotional impact. It must give a clear direction or mental image to anyone that reads it. Provide a sense of belonging to the stakeholders. We provide the worlds builders.

How to write mission statement?

Write down your ideas for why you need mission statement for your company. This is your dream, the thought of success over the next 5 to 10 years. This is the emotion. This the path or goal we all must meet. Knowledge is limited. Imagination encircles the world.

Examples of visions
1. McDonalds - We are committed To doing what is right. To being a good neighbour and partner in the community To conduct our business with the environment in mind 2. Ford our company delivers excellent products and services and strives to make the world a better place.

Difference between mission and vision

As a group of two, write at least two differences between mission and vision, and discuss with tutor

Difference between mission and vision (cont.)

A mission statement describes the *present* state of a person or organization: "Who are you? Why are you here? Why do you exist?"

The vision statement describes *future* state: "Who do I want to be? Where do we want to go?" The vision should be inspirational and slightly out of reach. Typically, it is a person or organization's vision that provides a framework for planning.

Objectives
After developing mission statement, objectives are required to define. Objectives are much specific than mission statement For example- I want to finish my assignment by 10 oclock this morning. This indicates to perform a number of tasks including typing text into computer, reviewing some questions/criteria that have already be written, printing out the assignment for proofreading and so on.

Objectives (cont.)
Objectives must be evaluated by SMARTER tool: Specific Measurable Attainable Realistic Timeframe Extending Rewarding

What is goal?
Goal is a target to achieve within a specific time. Without goal or aim, you cannot live (lead) your life happily and with the feeling of satisfaction. Goal can be one or more objectives that need to be achieved by specific time. Goal makes one to get clarification to do a specific task choosing from various options what one thinks of about his future

Types of goals
Uniform goals Performance based goals Potential based goals

Types of goals - Uniform

A single goal is set for all organizations within the Company. Every organization is expected to meet the same goal.

Types of goals - Performance based goals

Every organization is given a goal that reflects an increment on last years performance Increments are chosen to represent equal effort for organizations at different starting points

Types of goals Potential based goals

Criteria (external and/or internal) are used to assess organisations potential Based on criteria of a model or ratings, goals are set by the criteria Goal = f (criterion)

Core competencies
The objective of strategic planning process is to assess the core competencies of a company Core competencies are a set of unique internal skills processes and system provide competitive advantage in the market. A company should list functions, activities and skills that add values to both products and services better than competitors. For example, one function such as research, distribution, marketing or selling can add value to a product and this function needs to be improved continuously to stay ahead than other competitors

Core competencies (cont.)

Core competencies can be defined as the unique combination of the resources and experiences of a particular firm. It takes time to build these core competencies and they are difficult to imitate. Critical to sustaining these core competencies are their: Durability - their life span is longer than individual product or technology life-cycles, as are the life spans of resources used to generate them, including people. Intransparency - it is difficult for competitors to imitate these competencies quickly. Immobility - these capabilities and resources are difficult to transfer.