Table of Contents 3.1 3.2 3.2.1 3.2.2 3.2.3 3.2.4 3.2.5 3.3 3.3.1 3.3.2 3.3.3 3.3.4 3.4 3.4.1 3.4.2 3.4.3 3.4.4 3.5 3.5.1 3.6 3.6.1 3.6.2 Strategy Formulation Mission What is a mission Statement?

Types of Mission Statement Importance of Mission Statement Creation of a good Mission Statement Examples of Mission Statement Vision What is Vision Statement? Creation of a Vision statement Examples of vision statement Articulation of Vision Statement Business Objectives Importance of Aims and objectives in a business Criteria of effective business objective General Objectives of a Business Alternative aims and objectives Business Goals Steps to Write a goal Business Definition What is Business? Business Definition Statements

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 And a statement of major goals and objectives. It includes defining the corporate mission. methods to capitalize on new opportunities. It specifies a unique purpose that sets a company apart from its competitors and identifies the scope of the company‘s offerings to the market.Strengthening firm‘s competitive position .Running the business . readiness to respond to changing industry and market conditions. A mission statement has three main components:  Reason for the company‘s existence normally referred to as mission and vision. specifying achievable objectives. It tells what the company is giving to the society. ways of managing and achieving strategic and financial objectives.1 What is a Mission Statement? It is a description or declaration of why a company is in operation.1 STRATEGY FORMULATION It is the development of long range plans for the effective management of environmental opportunities and threats. developing strategies. It may also include . and setting policy guidelines. either a service or a product. In other words.2. it is the Management‘s ―game plan‖ for .Satisfying customers .CHAPTER – 3 STRATEGY FORMULATION 3. 3.  A statement of the key values or guiding standards that will shape the actions of the employees. It is the fundamental purpose or reason for the organization‘s existence. Strategy is an action plan of a company and consists of competitive moves & business approaches to produce successful performance-it is an on going process. which provides the framework or the context within which strategies are formulated.Achieving performance targets A firm‘s strategy consists of the ways to satisfy their customers.2 MISSION 3. in light of corporate strengths and weaknesses. means to grow their business.

and reflects the philosophical premises that are to guide actions. a mission statement proclaims corporate purpose.2. The mission statement promotes a sense of shared expectations in employees and communicate a public image to the society.2 Types of mission statement A mission statement may be defined in two ways: Mission Statement Narrow Mission Statement Broad Mission Statement 3. . A mission statement describes what the organization is now and what they would like to become. This proclamation indicates what the organization intends to accomplish.the firm‘s philosophy of dealing with its business and its employees. One example of a mission statement is that of ONGC Ltd: To be a world-class Oil and Gas Company integrated in energy business with dominant Indian leadership and global presence.2. in simple yet powerful terms. identifies the market(s) in which the firm intends to operate. 3. but it fails to clearly identify either what it makes or which product/markets it plans to emphasize.2. Thus. A broadly defined mission statement keeps the company from restricting itself to one field or product line.1 Broad Mission Statement A broad mission statement includes how the company will serve the best interests of stakeholders. The purpose of mission statement should be valid for 20-30 years or even longer. The simpler the statement the better it is.

because mission statements embody a company's soul. Levi Strauss & Company's mission statement provides an interesting example in terms of these issues.” Companies that do not have a clear and concise written mission statement risk wandering aimlessly in the sea of competitors. and a tone. not about what looks good to others. an image of the company's character. technology used and the market served. delivering superior and sustainable stakeholder value. We seek this while offering quality products and service-. through which actions are guided.and by being a leader in what we do. He noted that "a business is not defined by its name. Example “Nirma is a customer-focused company committed to consistently offer better quality products and services that maximize value to the customer. Peter Drucker (1973) perhaps best described the general relationship and sequence between a mission statement and objectives.” 3. It is . Only after a mission statement has been developed can objectives and appropriate strategies be formed properly in all segments of a company. but it may limit the scope of the firm in terms of expanding its activities. The company's mission statement is described as follows: ―We seek profitable and responsible commercial success creating and selling jeans and casual clothing. they are often inspirational. Mission statements are also intended to provide motivation.e. or set of attitudes.2 Narrow mission statement: A narrow mission statement very clearly states the organization‘s primary business.Example “ITC mission statement.‖ Once completed. mission statements become the foundation on which other intended actions are built.2. or articles of incorporation.To enhance the wealth generating capability of the enterprise in a globalising environment. Furthermore.3 Importance Of Mission Statement Peter Drucker has rightly said-“That business mission is so rarely given adequate thought is perhaps the most important single cause of business frustration. general direction.2.” 3. The most important attribute of a mission statement is that of its authenticity. i.2. statutes.

fairness and integrity. Make sure you choose the most important measures.2." 3. “ . PepsiCo ”We aspire to make PepsiCo the world’s premier consumer products company. focused on convenient foods and beverages. 3.  Combine your winning idea and success measures into a tangible and measurable goal. Only a clear definition of the mission and purpose of the organization makes possible clear and realistic business objectives.  Next identify the key measures of your success.5 Examples of Mission Statement The mission of Life Quest Center is to provide educational opportunities which empower individuals to improve the quality of their lives and excel in relationships through personal growth. our business partners and the communities in which we operate.2.defined by the business mission.4 Creation of a good Mission: For creating a mission statement for an organization one has to follow the prescribed procedure:  First identify your organization‘s ―winning idea‖ This is the idea or approach that will make your organization stand out from its competitors. We seek to produce healthy financial rewards for investors as we provide opportunities for growth and enrichment to our employees. And in everything we do. and is the reason that customers will come to you and not your competitors. which expresses your ideas. we strive to act with honesty.  Refine the words until you have a concise and precise statement of your mission. measures and desired result. openness.

competitive pricing. Dell will meet consumer expectations of highest quality.3 VISION 3. best-in-class service and support. and value creation. As a result. “ 3. or the outcome of a project or goal.3. . energizes and helps you create a mental picture of your target. It could be a vision of a part of your life. individual and company accountability.Dell “Dell’s mission is to be the most successful computer company in the world at delivering the best customer experience in markets we serve. allowing our people. our environment and to the communities in which we operate. our consumers. and the communities in which we live and work to prosper” L’Oreal “At L’Oreal. superior corporate citizenship. our shareholders. we believe that lasting business success is built upon ethical standards which guide growth and on a genuine sense of responsibility to our employees. profit. flexible customization capability. financial stability” Proctor & Gamble “Proctor & Gamble will provide branded products and services of superior quality and value that improve the lives of the world’s consumers. leading technology.1 What is a vision statement? A vision statement is a vivid idealized description of a desired outcome that inspires. In doing so. consumers will reward us with industry leadership in sales.

1. and vision for what they want in life. But most of us never write them down. Talk to successful people.words of aspiration and inspiration for your statement o You will now be in an excellent position and know how to write a statement! o Select your most important words and combine in one sentence or put your most important sentences together which must be combined in one short paragraph . It describes your hopes and dreams and evokes a sense of achievement and fulfillment. Its a hard but very important task. Then they use it as a compass to make it come true.future plans with aims and objectives o Pick out the most important points o Obtain input from other people o List some positive words . A personal vision statement describes how you see yourself in the future.2 Creation of a vision For creating a mission statement for an organization one has to follow the prescribed procedure:  Take your time when writing a Vision Statement.1 Features of an effective vision statement include:       Clarity and lack of ambiguity Vivid and clear picture Description of a bright future Memorable and engaging wording Realistic aspirations Alignment with organizational values and culture 3.  Make separate lists of the following: o Services .Your use of Technology o People involved in your establishment  People who attend your establishment  People who are involved in your establishment  The Community o Your Values and Philosophy o Your Vision .What you do and how well you do it! o Technology . learning how to write a Vision Statement takes time! It needs to be positive and inspirational.We all think about the big things we'd like to accomplish in life. and they'll tell you that they write down their values. 3.3.3. goals.

and a love for others.3 Examples of vision statement Manley Baptist Church “The Vision of Manley Baptist Church is to be the people of God. ITC “Sustain itcs position as one of india’s most valuable corporations through world class performance creating growing value for the indion economy and the company”s stakeholders. creating customer delight and shareholders wealth. on mission with God.” Microsoft's vision "A personal computer in every home running Microsoft software.” .” Maruti “The leader in the idian automobile industry.3.3." This simple yet very powerful phrase can be used throughout the organization. motivated by a love for God. A pride for india.

and individual leaders. Core Values Core values are the essential and enduring tenets of an organization.3.4 Articulation of Vision Figure 3. In fact. technological breakthroughs. which has guided the company since its inception more than 50 years ago.4. a dedication to affordable quality and reliability. core values require no external justification. includes a deep respect for the individual. A small set of timeless guiding principles. the most lasting and significant contribution of those who build visionary companies is the core ideology. a commitment to community responsibility and a view that the company exists to make technical contributions for the advancement and welfare of humanity.1 Articulation of vision 3. they have intrinsic value and importance to those inside the organization.1 Core Ideology Core ideology defines the enduring character of an organization—a consistent identity that transcends product or market life cycles.‖ HP‗s core ideology.3. management fads. The Walt Disney Company‘s core values of imagination and wholesomeness stem not .3.

it captures the soul of the organization. In addition to vision-level BHAGs. energizing. highly focused. and aspirations. Henry Ford brought to life the goal of democratizing the automobile with this vivid description: ―I will build a motor car for the great multitude. A BHAG engages people—it reaches out and grabs them. A true BHAG is clear and compelling. Picture painting is essential for making the 10-to-30-year BHAG tangible in people‘s minds. Think of it as translating the vision from words into pictures. It doesn‘t just describe the organization‘s output or target customers. an envisioned future needs what we call vivid description—that is. It has a clear finish line. impossible-to-remember mission statement.4. For example. Audacious Goals)—as a powerful way to stimulate progress. Vision-level BHAG. Hairy. engaging. people like to shoot for finish lines. Vivid Description. a vibrant. is the organization‘s reason for being. and real. It will be so low in . serves as a unifying focal point of effort.3. vivid.2 Envisioned Future The second primary component of the vision framework is envisioned future. An effective purpose reflects people‘s idealistic motivations for doing the company‘s work. On the one hand. For example. Purpose (which should last at least 100 years) should not be confused with specific goals or business strategies (which should change many times in 100 years). and acts as a catalyst for team spirit. 3. the second part of core ideology.from market requirements but from the founder‘s inner belief that imagination and wholesomeness should be nurtured for their own sake. it conveys concreteness— something visible. so the organization can know when it has achieved the goal. it involves a time yet unrealized—with its dreams.. We found in our research that visionary companies often use bold missions—or what we prefer to call BHAGs (pronounced BEE-hags and shorthand for Big. hopes. Core Purpose Core purpose. of creating an image that people can carry around in their heads.. daunting challenge—such as climbing Mount Everest. and specific description of what it will be like to achieve the BHAG. But there is a difference between merely having a goal and becoming committed to a huge. We recognize that the phrase envisioned future is somewhat paradoxical. It is tangible. On the other hand. It consists of two parts: a 10-to-30-year audacious goal plus vivid descriptions of what it will be like to achieve the goal. People get it right away. NASA‘s 1960s moon mission didn‘t need a committee of wordsmiths to spend endless hours turning the goal into a verbose. it takes little or no explanation. It is a question of painting a picture with your words. All companies have goals.

and crushing competitiors  Sony: To experience the joy of advancing and applying technology for the benefit of the public  Wal-Mart: To give ordinary folk the chance to buy the same things as rich people  Walt Disney: To make people happy Big. the most serviceable. Hairy Audacious Goals  Wal-Mart (1990): become a $125 billion company by the year 2000.  Sony (1950): become the company most known for changing the worldwide poor-quality image of Japanese products. doing the impossible  Encouraging individual ability and creativity Walt Disney  No cynicism  Nurturing and promulgation of ―wholesome American values‖  Creativity.3. the most far-reaching world financial institution that has ever been. dreams.price that no man making a good salary will be unable to own one and enjoy with his family the blessing of hours of pleasure in God‘s great open spaces.  Nike (1960): crush Adidas.  Honda (1970): we will destroy Yamaha! . 3.  Ford (1900): democratize the automobile.  City Bank (1915): become the most powerful. winning.5 Examples Core Values Are a Company’s Essential Tenets Sony  Elevation of the Japanese culture and national status  Being a pioneer—not following others. and imagination  Fanatical attention to consistency and detail  Preservation and control of the Disney magic Core Purpose Is a Company’s Reason for Being  3M: To solve unsolved problems innovatively  Nike: To experience the emotion of competition.

Plans can then be made to achieve these targets. We will succeed with innovations that U. For instance. Fifty years from now.4 BUSINESS OBJECTIVES An aim is where the business wants to go in the future. we want to grow the business into Europe. we want to achieve sales of €10 million in European markets by 2010.. market and distribute directly.S.. doing the impossible  Encouraging individual ability and creativity Purpose To experience the sheer joy of innovation and the application of technology for the benefit and pleasure of the general public Envisioned Future BHAG Become the company most known for changing the worldwide poor-quality image of Japanese products Vivid Description We will create products that become pervasive around the world.S. It is a statement of purpose.. our brand name will be as well known as any in the world.. Objectives give the business a clearly defined target. not something shoddy. Business objectives are the stated. companies have failed at—such as the transistor radio. when a sole trader sets up he may have some unstated aims or objectives . measurable targets of how to achieve business aims.. This . e. For example. 3.... its goals. ―Made in Japan‖ will mean something fine... We will be the first Japanese company to go into the U.Putting It All Together: Sony in the 1950s Core Ideology Building Your Company's Vision Core Values  Elevation of the Japanese culture and national status  Being a pioneer—not following others.for example to survive for the first year.and will signify innovation and quality that rival the most innovative companies anywhere.g.

or when a new firm enters the market or at a time of crisis. T. therefore aims and objectives are used to help them focus on one view on the aspect which either seems right or is right. 3.can motivate the employees. but it should also be able to be achieved by the resources available.2 The most effective business objectives meet the following criteria S – Specific – objectives are aimed at what the business does.000 in sales in the next half year of trading.g.4. What the organization is heading for and how it is heading there and where it is heading? All the answers for these questions are answered by Aims & Objectives.Time specific – they have a time limit of when the objective should be achieved. Examples of corporate objectives are General Electric. It also enables the business to measure the progress towards to its stated aims.4. 3. a plan and a goal. a hotel might have an objective of filling 60% of its beds a night during October. For example objective of Apple Inc is – “To offer the best possible personal computing technology and to put that technology in the hands of as many people as possible.To become the most competitive enterprise in the world by being number one or number two in market share in every business the company is in. there are always different views on a certain aspect. A . it is used as a guideline. by the end of the year.g.3 The general objectives of a business are: Survival – a short term objective. probably for small business just starting out. €10. M .4.g. e.” 3.Realistic – the objective should be challenging. .1 Importance of Aims and objectives in a business In a business when a number of brains are working together.Measurable – the business can put a value to the objective. R . Aims and Objectives help an organization grow. e. an objective specific to that business. e.Agreed by all those concerned in trying to achieve the objective.

Large businesses can also benefit from economies of scale. Some organisations have alternative objectives. This may be because the managers believe that the survival of business depends on being large.5 Alternative Aims and Objectives Not all businesses seek profit or growth. achieving higher sales in the short term (e. every time.4. a business may decide to accept lower cash flows in the short-term whilst it invests heavily in new products or plant and equipment. Profit satisficing – try to make enough profit to keep the owners comfortable – probably the aim of smaller businesses whose owners do want to work longer hours.be Profit maximisation – try to make the most profit possible – most like to the aim of the owners and shareholders. Large investors in the Stock Exchange are often accused of looking too much at short-term objectives and company performance rather than investing in a business for the long-term. not the A business may find that some of their objectives conflict with one and other:   Growth versus profit: for example. 3. Short-term versus long-term: for example.g.‖ Their usage of different activities allows McDonald‘s and the Customers to have a relation with them. Aims & Objectives of McDonald‘s‘ – ―it‘s what I eat and what I do…I‘m lovin‘ it‖ Plan – Their plan is to deepen their connection with the customer by providing great service ad experience ―in every restaurant. by cutting prices) will reduce short-term profit. Examples of other objectives: Ethical and socially responsible objectives – organisations like the Co-op or the Body Shop have objectives which are based on their beliefs on how one should treat the environment and . Sales growth – where the business tries to make as many sales as possible.

4. 5. Write your goal in the positive instead of the negative. Make sure the goal you are working for is something you really want. 2. 3.3. write down your goals. make sure your goal is high enough. A goal can not contradict any of your other goals.2 Business Definition Statements .1 What is our Business in precise way  ―We are in the beauty enriching Business‖ (Helen and Curtis)  ― We are in the Business of Computing Technology‖ (Intel)  ―We are Watch makers of the nation‖ (HMT)  ―We are in the transportation business‖ (TELCO) 3. 7. This is the most important.6 BUSINESS DEFINITION A Business Definition is a clear statement of the business the firm is engaged in or is planning to enter. 3. 3.‖ For example the goal may be to increase student employment opportunities and a supporting objective might be to increase the number of employer co-op positions by 30% over the next 3 years.5.6. Goals are typically not measurable but are usually supported by one or more measurable ―objectives. By all means.1 Steps to write a goal 1. not just something that sounds good.6. Write your goal out in complete detail 6.5 BUSINESS GOALS Goal is a desired end result.

   Define the ‗space‘ that the business wants to create for itself in competitive terrain Broadly specifies the opportunities that the business may exploit within the space and the threats it may encounter from rival firms in course of time Must be defined in broad ways. keeping changing customer tastes and aspirations in mind .

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