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Developing Mission Vision And Lt Os

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Developing Mission Vision And Lt Os

  1. 1. Strategic Management Developing Mission, Vision and Long-Term Objectives
  2. 2. The Five Tasks of Strategic Management Craft a Strategy to Achieve Objectives Set Objectives Develop a Strategic Vision & Mission Implement & Execute Strategy Evaluate & Make Corrections Improve/ Change Revise as Needed Revise as Needed Improve/ Change Recycle as Needed Task 1 Task 2 Task 3 Task 4 Task 5
  3. 3. What Is a Strategic Plan? Where firm is headed -- Strategic vision and business mission Action approaches to achieve targeted results -- A comprehensive strategy Short and long term performance targets -- Strategic and financial objectives
  4. 4. Developing a Vision and Mission <ul><li>Begins with thinking strategically about </li></ul><ul><ul><li>The firm’s future business makeup </li></ul></ul><ul><ul><li>Where to take the firm </li></ul></ul><ul><li>The task is to </li></ul><ul><ul><li>Create a roadmap of a company’s future </li></ul></ul><ul><ul><li>Decide what future business position to stake out </li></ul></ul><ul><ul><li>Provide long-term direction </li></ul></ul><ul><ul><li>Give the firm a strong identity </li></ul></ul>The First Task of Strategic Management
  5. 5. Missions vs. Strategic Visions <ul><li>A mission statement focuses on current business activities </li></ul><ul><ul><li>Business(es) company is in now </li></ul></ul><ul><ul><li>Customer needs currently being served </li></ul></ul><ul><li>A strategic vision concerns a firm’s future business path </li></ul><ul><ul><li>The kind of company it is trying to become </li></ul></ul><ul><ul><li>Customer needs to be satisfied in the future </li></ul></ul>
  6. 6. Defining a Company’s Business <ul><li>A good business definition incorporates three factors </li></ul><ul><ul><li>Customer needs -- WHAT is being satisfied </li></ul></ul><ul><ul><li>Customer groups -- WHO is being satisfied </li></ul></ul><ul><ul><li>Technologies used and functions performed -- HOW customer needs are satisfied </li></ul></ul>
  7. 7. Examples: Mission and Vision Statements <ul><li>Otis Elevator </li></ul><ul><li>Our mission is to provide any customer a means of moving people and things up, down, and sideways over short distances with higher reliability than any similar enterprise in the world. </li></ul>Microsoft Corporation One vision drives everything we do: A computer on every desk and in every home using great software as an empowering tool.
  8. 8. Business Mission: Russell Corp. <ul><li>Russell Corporation is a vertically integrated international designer, manufacturer, and marketer of athletic uniforms, . . . , and a comprehensive line of lightweight, yarn-dyed woven fabrics. </li></ul><ul><li>The Company’s manufacturing operations include the entire process of converting raw fibers into finished apparel and fabrics. </li></ul><ul><li>Products are marketed to sporting goods dealers, department and specialty stores, mass merchandisers, . . . , and other apparel manufacturers. </li></ul>
  9. 9. Setting Objectives <ul><li>Establishing OBJECTIVES </li></ul><ul><ul><li>Converts vision into specific performance targets </li></ul></ul><ul><ul><li>Creates yardsticks to track performance </li></ul></ul><ul><ul><li>Pushes firm to be inventive and focused </li></ul></ul><ul><ul><li>Helps prevent coasting and complacency if targets require stretch </li></ul></ul>The Second Task of Strategic Management
  10. 10. Examples: Financial Objectives-Strategic Objectives <ul><li>Achieve revenue growth of 10% per year </li></ul><ul><li>Increase earnings by 15% annually </li></ul><ul><li>Increase dividends per share by 5% per year </li></ul><ul><li>Increase net profit margins from 2% to 4% </li></ul><ul><li>Attractive EVA performance </li></ul><ul><li>Stronger bond and credit ratings </li></ul><ul><li>A rising stock price (outperform the S&P 500) </li></ul><ul><li>Attractive increases in MVA </li></ul><ul><li>Recognition as a “blue chip” company </li></ul><ul><li>A more diversified revenue base </li></ul><ul><li>A bigger market share </li></ul><ul><li>Quicker design-to-market times than rivals </li></ul><ul><li>Higher product quality than rivals </li></ul><ul><li>Lower costs relative to key competitors </li></ul><ul><li>Broader product line than rivals </li></ul><ul><li>A stronger reputation with customers than rivals </li></ul><ul><li>Better customer service than rivals </li></ul><ul><li>Recognition as a leader in technology </li></ul><ul><li>Wider geographic coverage than rivals </li></ul><ul><li>More innovative products than rivals </li></ul>

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