Lecture 2 week 2

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Learning Objectives
1. Describe a company mission and explain its value
2. Explain why the mission statement should include the company’s
basic product or service, its primary markets, and its principal
technology
3. Explain which goal of a company is most important: survival,
profitability, or growth
4. Discuss the importance of company philosophy, public image, and
company self-concept to stockholders
5. Give examples of the newest trends in mission statement
components: customer emphasis, quality, and company vision
6. Describe the role of a company’s board of director

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What is a Company Mission?

Company Mission:
A broadly framed but enduring statement
of a firm’s intent. It is the unique purpose
that sets a company apart from others .

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Formulating a Mission
What factors determine the content of a mission
statement?
1)
2)
3)
4)
5)

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Inputs to the Development of Company
Mission

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Importance Boards of Directors in Mission development

The board of directors is the group of

stockholder representatives and strategic
managers responsible for overseeing the
creation and accomplishment of the
company mission.

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Major Board Responsibilities:
Establish and update mission
Elect top officers & CEO
Establish compensation for top officers
Determine amount & timing of dividends
Set broad company policy
Set objectives and authorize managers to implement
long-term strategy
Mandate company’s legal and ethics compliance

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Mission Statement Components
1. Customer-market
2. Product-service
3. Geographic Domain
4. Technology
5. Concern for Survival
6. Philosophy
7. Self-concept
8. Concern for Public Image
9. Consumers
10. Quality

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3 Key elements

Company Mission:
1. Identity
2. Products/Services
3. Production and selling approach

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Sample Questions Addressed in a
Mission Statement
1. Why is this firm in business?
2. What customers do and can we serve?
3. How do we view our responsibilities to
stockholders, employees, communities,
environment, social issues, and competitors?

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Corporate Social Responsibility
Corporate social responsibility (CSR), is the
idea that business has a duty to serve
society in general as well as the financial
interests of stockholders.

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Examples of Stakeholders
1)
2)
3)
4)
5)
6) etc

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Types of Social Responsibility
1)
2)
3)

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Mission Statements & Goals
1) Survival /profitability

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Primary Company Goals (contd.)
2) Essential services and the concept of
affordability

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Primary Company Goals
3) Growth – A firm’s growth is tied
inextricably to its survival and profitability.
Growth in this sense must be broadly
defined.
.

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 Vision & Mission statements
A vision statement presents a firm’s strategic
intent designed to focus the energies and
resources of the company on achieving a
desirable future.

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