MSU

08501
Topic 2:
FORMULATING A DIRECTION FOR THE
COMPANY

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Outline

2.1Organization Vision
2.2 Organization Mission
2.3 Organization Philosophy and policies
2.4 Strategic Goals and Objectives
2.5 Core values

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 Vision of the organization

• A vision statement involves thinking strategically

about the firms' future business plans and where to
go.
• It create a road map for the future and decide future
business position to stake out.
• It is an expression of aspirations, strategic intent and
wishes of an organization.
• Vision is what the organization want to achieve in
future
• Dess (1996) defined it as the category of intentions
that are broad, all inclusive and forward thinking.
• Organization without a vision is a dead one.
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A vision statement cont….
The purpose of the vision stmn is to get your team to
imagine what is psbl. Hence, it express the following
• The b’ness ideal position in the future or best
possible outcome
• What you want to become as a business
• An openness to substantive change
• A goal worth stretching
• The core element of your strategy
• The change you want to see in the
community/country you save
• A narrative for why you will take action
• Emotions Massae R 2022 4
Vision cont…

Good vision statements are:

• Concrete and specific
• Bold, challenging and exciting
• Positive, inspiring and share sense of purpose
• Attainable
• Simple
• The beginning of a compelling story
• Surprising or unexpected
• Credible

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 Vision cont…

• Helps to create common identity

• Represent integrity, working hard to benefit all.
• Foster risk taking and experimenting
• Foster long term thinking

What are examples of Vision statement?

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Mission Statement
•Define how organization intends to achieve
the vision or get to where they want to be in
the future.
•The mission statement make reference to the
specific changes anticipated and describe how
they will support the Vision.
• Is defined as an enduring statement of
purpose that distinguishes organization from
other similar organizations.
•It is the fundamental reason for their
existence. Massae R 2022 7
 Mission Statement cont…
Hence mission statement define the present business
scope and broadly describes the orgn present
capabilities, focus and activities.
The mission comm. values to everyone the company
touches.
It will consider the basic beliefs and values of the
orgn, the company target customers, the basic
products and the services that customer need, how to
better satisfy those needs and wants, how to offer
better values to our customers, what is the business
competitive adv, who are the company’s key
stakeholders and how do they effect the company
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Components of a Mission Statement
1. Customers—Who are the firm’s customers?
2. Products or services—What are the firm’s major products or
services?
3. Markets—Geographically, where does the firm compete?
4. Technology—Is the firm technologically current?
5. Concern for survival, growth, and profitability—Is the firm
committed to growth and financial soundness?
6. Philosophy—What are the basic beliefs, values, aspirations, and
ethical priorities of the firm?
7. Self-concept—What is the firm’s distinctive competence or
major competitive advantage?
8. Concern for public image—Is the firm responsive to social,
community, and environmental concerns?
9. Concern for employees—Are employees a valuable asset of the
firm?
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 Characteristic of good Mission

The effective Mission statement should

• Broad in scope
• Generate range of feasible strategic alternative
• Not excessively specific
• Reconcile interest among diverse stakeholder
• Finely balanced between specificity and general
• Arouse positive feelings and emotions
• Provide criteria for selecting strategies
• Are dynamic
• Motivate readers to action.
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Organizational Philosophy

• These represent values, beliefs, commitments and aspirations

of the company.
• It serves as the guide for the behaviour of its employees as
well as how the organization conducts its business.
• It reflects the culture of the enterprise and provide the
underlying framework for decision making

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Organizational Policies

• Policies are broad, precedent setting decisions that guide or

substitute repetitive managerial decision making.
• These are guide to action that define the “ball park” within
which the objectives are established and strategies are
determined, implemented and controlled.
• Policies provide executives with a framework for decision
making;
• They often increase managerial effectiveness by standardize
routine decisions and limit the discretion of managers and
subordinate in implementing operating strategies

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 Goals and Objectives of an Organization

Goals describe the future end state which is desired outcome

that is a supportive of the mission and vision of the
organization. Whereas,
Strategic objectives are the ends the total organization hope to
achieve in fulling its basic mission.
These desired outcome serve as benchmarks against which an
organization can measure its progress as it implements its
plan.
They translate into specific terms the results an organization
must have in order to fulfill its mission. i.e., strategic
objectives are used to operationalize the mission statement

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 Objectives cont…

• Strategic objectives set forth the competitive market

position and specific performance targets that an
enterprise seek to achieve in pursuing the strategic
mission.
• The following are the major areas where the long
term objectives involved
• Public responsibility
• Profitability
• Technological leadership,
• Return on investment

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Objectives cont…
•Employees relations
•Employee development
•Market share
•Growth in revenue
•Competitive strength
•Growth in revenue
•Reputation with customers.

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Objectives cont…

• The process that lead to determination of strategic

objectives is influenced by various power both
inside and outside the organizations.
• We need objectives for the following reasons
i. Convert organization’s direction into specific
performance standards
ii. Guard against drift, aimless activities, confusion
over what to accomplish and loss of purpose

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Criteria for the Meaningful objectives

• Measurable – must be at least one indicator that

measure progress against fulfilling objectives
• Specific – Provide a clear message as what need to
be accomplished
• Realistic – Must be an achievable target, given the
organization opportunities and capabilities in the
environment
• Timely – There need to be a timeframe

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Advantages of strategic objective

• 1. Help to channel employees throughout the organization

towards common goals
2. Challenging objectives can help to motivate and inspire
employees throughout the organization to higher level of
commitment and effort
3.There is always a potential for different parts of an
organization to pursue their own goals rather than overall
company’s goals.
4. Provide yardstick for rewards and incentives i.e. equity and
fairness when rewards are allocated

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Goals vs. Objectives
Goal Objective

1 Very short statement, Longer statement, more

with few words descriptive
2 Broad in scope Narrow in scope

3 Directly relate to the Indirectly related to the

mission statement mission statement
4 Cover long time period Covers short time period
(such as 10 year) (such as 1 year)
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