Defining a Market-Oriented Mission
An organization exists to accomplish something, and this purpose should be clearly stated. Forging a sound mission begins with the following questions: What is our business? Who is the customer? What do consumers value? What should our business be? These simple-sounding questions are among the most difficult the company will ever have to answer. Successful companies continuously raise these questions and answer them carefully and completely. Many organizations develop formal mission statements that answer these questions. A mission statement is a statement of the organization’s purpose what it wants to accomplish in the larger environment. A clear mission statement acts as an “invisible hand” thatguides people in the organization.
An organization exists to accomplish something, and this purpose should be clearly stated. Forging a sound mission begins with the following questions: What is our business? Who is the customer? What do consumers value? What should our business be? These simple-sounding questions are among the most difficult the company will ever have to answer. Successful companies continuously raise these questions and answer them carefully and completely. Many organizations develop formal mission statements that answer these questions. A mission statement is a statement of the organization’s purpose what it wants to accomplish in the larger environment. A clear mission statement acts as an “invisible hand” thatguides people in the organization.
Some companies define their missions myopically in product or technology terms (“We make and sell furniture” or “We are a chemical-processing firm”). But mission statements should be market oriented and defined in terms of satisfying basic customer needs. Products and technologies eventually become outdated, but basic market needs may last forever. Under Armour’s mission isn’t just to make performance sports apparel; it’s “to make all athletes better through passion, science, and the relentless pursuit of innovation.” Likewise, Chipotle’s mission isn’t to sell burritos. Instead, the restaurant promises “Food with Integrity,” highlighting its commitment to the immediate and long-term welfare of customers and the environment. Chipotle’s serves only the very best natural, sustainable, local ingredients raised “with respect for the animals, the environment, and the farmers.”
Mission statements should be meaningful and specific yet motivating. They should emphasize the company’s strengths in the marketplace. Too often, mission statements are written for public relations purposes and lack specific, workable guidelines. Says marketing consultant Jack Welch:3 Few leaders actually get the point of forging a mission with real grit and meaning.
Mission statements should be meaningful and specific yet motivating. They should emphasize the company’s strengths in the marketplace. Too often, mission statements are written for public relations purposes and lack specific, workable guidelines. Says marketing consultant Jack Welch:3 Few leaders actually get the point of forging a mission with real grit and meaning.
Mission statements] have largely devolved into fat-headed jargon. Almost no one can figure out what they mean. [So companies] sort of ignore them or gussy up a vague package deal along the lines of: “our mission is to be the best fill-in-the-blank company in our industry.” [Instead,Welch advises, CEOs should] make a choice about how your company will win. Don’t mince words! Remember Nike’s old mission, “Crush Reebok”? That’s directionally correct. And Google’s mission statement isn’t somethingnamby-pamby like “To be the world’s best search engine.” It’s “To organize theworld’s information and make ituniversallyaccessible and useful.” That’s simultaneouslyinspirational, achievable, and completely graspable.
Setting Company Objectives and Goals
The company needs to turn its mission into detailed supporting objectives for each level of management. Each manager should have objectives and be responsible for reaching them. For example, Kohler makes and markets familiar kitchen and bathroom fixtures everything from bathtubs and toilets to kitchen sinks. But Kohler also offers a breadth of other products and services, including furniture, tile and stone, and even small engines and backup power systems. It also owns resorts and spas in the United States and Scotland. Kohler ties this diverse product portfolio together under the mission of “contributing to a higher level of gracious living for those who are touched by our products and services.
This broad mission leads to a hierarchy of objectives, including business objectives and marketing objectives. Kohler’s overall objective is to build profitable customer relationships by developing efficient yet beautiful products that embrace the “essence of gracious living” mission. It does this by investing heavily in research and design. Research is expensive and must be funded through improved profit, so improving profits becomes another major objective for Kohler. Profits can be improved by increasing sales or reducing costs. Sales can be increased by improving the company’s share of domestic and international markets. These goals then become the company’s current marketing objectives. Marketing strategies and programs must be developed to support these marketing objectives. To increase its market share, Kohler might increase its products’ availability and promotion in existing markets and expand into new markets. For example, Kohler is boosting production capacity in India and China to better serve the Asian market. These are Kohler’s broad marketing strategies. Each broad marketing strategy must then be defined in greater detail. For example, increasing the product’s promotion may require more salespeople, advertising, and public relations efforts; if so, both requirements will need to be spelled out. In this way, the firm’s mission is translated into a set of objectives for the current period.
Designing the Business Portfolio
Guided by the company’s mission statement and objectives, management now must planits business portfolio the collection of businesses and products that make up the company.The best business portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment. Business portfolio planning involves two steps. First, the company must analyze its current business portfolio and determine which businesses should receive more, less, or no investment. Second, it must shape the future portfolio by developing strategies for growth and downsizing.
Setting Company Objectives and Goals
The company needs to turn its mission into detailed supporting objectives for each level of management. Each manager should have objectives and be responsible for reaching them. For example, Kohler makes and markets familiar kitchen and bathroom fixtures everything from bathtubs and toilets to kitchen sinks. But Kohler also offers a breadth of other products and services, including furniture, tile and stone, and even small engines and backup power systems. It also owns resorts and spas in the United States and Scotland. Kohler ties this diverse product portfolio together under the mission of “contributing to a higher level of gracious living for those who are touched by our products and services.
This broad mission leads to a hierarchy of objectives, including business objectives and marketing objectives. Kohler’s overall objective is to build profitable customer relationships by developing efficient yet beautiful products that embrace the “essence of gracious living” mission. It does this by investing heavily in research and design. Research is expensive and must be funded through improved profit, so improving profits becomes another major objective for Kohler. Profits can be improved by increasing sales or reducing costs. Sales can be increased by improving the company’s share of domestic and international markets. These goals then become the company’s current marketing objectives. Marketing strategies and programs must be developed to support these marketing objectives. To increase its market share, Kohler might increase its products’ availability and promotion in existing markets and expand into new markets. For example, Kohler is boosting production capacity in India and China to better serve the Asian market. These are Kohler’s broad marketing strategies. Each broad marketing strategy must then be defined in greater detail. For example, increasing the product’s promotion may require more salespeople, advertising, and public relations efforts; if so, both requirements will need to be spelled out. In this way, the firm’s mission is translated into a set of objectives for the current period.
Designing the Business Portfolio
Guided by the company’s mission statement and objectives, management now must planits business portfolio the collection of businesses and products that make up the company.The best business portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment. Business portfolio planning involves two steps. First, the company must analyze its current business portfolio and determine which businesses should receive more, less, or no investment. Second, it must shape the future portfolio by developing strategies for growth and downsizing.
No comments:
Post a Comment