Strategic Management- Vission and Mission

1. 2–
CHARTING AN ORGANIZATION
DIRECTION: VISION AND MISSION,
OBJECTIVES, AND STRATEGY

2. WHAT DOES THE STRATEGY-MAKING,
STRATEGY-EXECUTING PROCESS ENTAIL?
2–
1. Developing a strategic vision, a mission, and a set
of values.
2. Setting objectives for measuring performance and
progress.
3. Crafting a strategy to achieve those objectives.
4. Executing the chosen strategy efficiently and
effectively.
5. Monitoring strategic developments, evaluating
execution, and making adjustments in the vision
and mission, objectives, strategy, or execution as
necessary.

3. The Strategy-Making, Strategy-Executing
Process
2–

4. STAGE 1: DEVELOPING A STRATEGIC
VISION, A MISSION, AND A SET OF
CORE VALUES
2–
Developing a Strategic Vision:
 Delineates management’s future aspirations
for the business to its stakeholders.
 Provides direction—“where we are going.”
 Sets out the compelling rationale (strategic
soundness) for the firm’s direction.
 Uses distinctive and specific language to set
the firm apart from its rivals.

5. Communicating the Strategic Vision
2–
Why Communicate the Vision:
 Fosters employee commitment to the firm’s
chosen strategic direction.
 Ensures understanding of its importance.
 Motivates, informs, and inspires internal and
external stakeholders.
 Demonstrates top management support for
the firm’s future strategic direction and
competitive efforts.

6. What a vision should and shouldn’t be
 vision should be
 An organizational charter of core values and
principles
 Ultimate source of our priorities, plans and goals
 A puller (not pusher )into the future.
 A determination and publication of what makes us
unique
 A Declaration of Independence
 Vision shouldn’t be
 High concept statement, motto or slogan or advertising
slogan

7. Strategy or plan and a view from the top
History of our proud past
A soft business issue
passionless

8. Crafting a Mission Statement
2–
The Mission Statement:
 Uses specific language to give the firm its
own unique identity.
 Describes the firm’s current business and
purpose—“who we are, what we do, and
why we are here.”
 Should focus on describing the company’s
business, not on “making a profit”—earning
a profit is an objective not a mission.

9. The Ideal Mission Statement
2–
Identifies the firm’s product or services.
Specifies the buyer needs it seeks to satisfy.
Identifies the customer groups or markets it is
endeavoring to serve.
Specifies its approach to pleasing customers.
Sets the firm apart from its rivals.
Clarifies the firm’s business to stakeholders.

10. Vision vs. Mission
VISION
♦ Future-oriented
♦ Inspirational
MISSION
Present-oriented
Informational
2–

11. Linking Vision and Mission with Core Values
2–
Core Values
 Are the beliefs, traits, and behavioral norms that
employees are expected to display in conducting the
firm’s business and in pursuing its strategic vision
and mission.
 Become an integral part of the firm’s culture and
what makes it tick when strongly espoused and
supported by top management.
 Matched with the firm’s vision, mission, and strategy
contribute to the firm’s business success.

12. EXAMPLES – vision:
2–
• FedEx
Satisfying worldwide demand for fast, time-
definite, reliable distribution
• Fortis Healthcare Limited
To be the ultimate healthcare destination -
"Mecca of Medicine"
• Bhakti Vedanta Hospital-We shall have the
organizational culture based on spirituality.
 We shall be leading healthcare provider of quality medical services.
 We shall be known for distinct community work.
 We shall have committed satisfied employees.
 We shall achieve this by innovative resourcing and funding
activities.

13. EXAMPLES - mission:
2–
Yahoo
To be the most essential global Internet service
for consumers and businesses.
Google
To organize the world’s information and make it
universally accessible and useful

14. EXAMPLES – core values:
2–
American Express
Customer commitment, quality, integrity,
teamwork and respect for people.
Abbott Laboratories
Pioneering, achieving, caring and
enduring.
DuPont
Safety,ethics, respect for people, and
environmental stewardship.

15. STAGE 2: SETTING OBJECTIVES
2–
The Purposes of Setting Objectives:
 To convert the vision and mission into specific,
measurable, timely performance targets.
 To focus efforts and align actions throughout
the organization.
 To serve as yardsticks for tracking a firm’s
performance and progress.
 To provide motivation and inspire employees
to greater levels of effort.

16. THE TWO ESSENTIAL KINDS OF
OBJECTIVES TO SET
2–
♦ Financial Objectives
 Communicate top
management’s targets for
financial performance.
 Are focused internally on
the firm’s operations and
activities.
♦ Strategic Objectives
 Are related to a firm’s
marketing standing and
competitive vitality.
 Are focused externally
on competition vis-à-
vis the firm’s rivals.

17. SETTING FINANCIAL OBJECTIVES
Examples of Financial Objectives
♦ An x percent increase in annual revenues
♦ Annual increases in after-tax profits of x percent
♦ Annual increases in earnings per share of x percent
♦ Annual dividend increases of x percent
♦ Profit margins of x percent
♦ An x percent return on capital employed (ROCE) or return on
shareholders’ equity investment (ROE)
♦ Increased shareholder value—in the form of an upward-trending stock
price
♦ Bond and credit ratings of x
♦ Internal cash flows of x dollars to fund new capital investment
2–

18. SETTING STRATEGIC OBJECTIVES
Examples of Strategic Objectives
♦ Winning an x percent market share
♦ Achieving lower overall costs than rivals
♦ Overtaking key competitors on product performance or quality or
customer service
♦ Deriving x percent of revenues from the sale of new products introduced
within the next five years
♦ Having broader or deeper technological capabilities than rivals
♦ Having a wider product line than rivals
♦ Having a better-known or more powerful brand name than rivals
♦ Having stronger national or global sales and distribution capabilities
than rivals
♦ Consistently getting new or improved products and services to market
ahead of rivals
2–

19. EMPLOYING A BALANCED SCORECARD
♦ A balanced scorecard measures a firm’s
optimal performance by:
Placing a balanced emphasis on achieving both
financial and strategic objectives.
Avoiding tracking only financial performance and
overlooking the importance of measuring whether
a firm is strengthening its competitiveness and
market position.
The surest path to sustained future profitability year after year is to relentlessly
pursue strategic outcomes that strengthen a firm’s business position and give
it a growing competitive advantage over rivals!
2–

20. THE NEED FOR SHORT-TERM AND
LONG-TERM OBJECTIVES
2–
Short-Term Objectives:
 Focus attention on quarterly and annual
performance improvements to satisfy near-
term shareholder expectations.
Long-Term Objectives:
 Force consideration of what to do now to
achieve optimal long-term performance.
 Stand as a barrier to an undue focus on
short-term results.

21. STAGE 3: CRAFTING A STRATEGY
2–
Strategy Making:
 Addresses a series of strategic how’s.
 Requires choosing among strategic alternatives.
 Promotes actions to do things differently from
competitors rather than running with the herd.
 Is a collaborative team effort that involves
managers in various positions at all
organizational levels.

22. 2–20
Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.
Who Is Involved in Strategy Making?
♦ Chief Executive Officer
(CEO)
●
His ultimate responsibility for leading the strategy-making
process as strategic visionary and as chief architect of strategy.
♦ Senior Executives
● Fashion the major strategy components involving their areas
of responsibility.
♦ Managers of subsidiaries, divisions, geographic
regions, plants, and other operating units (and key
employees with specialized expertise)
 Utilize on-the-scene familiarity with their business units to
orchestrate their specific pieces of the strategy.

23. 2–21
2.2
A Company’s Strategy-
Making Hierarchy

24. 2–22
Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.
What Is a Strategic Plan?
Its strategic vision, business
mission, and core values
Its strategic and financial
objectives
Its chosen strategy
Elements of a Firm’s
Strategic Plan

25. STAGE 4: EXECUTING THE STRATEGY
2–
♦ Converting strategic plans into actions
requires:
 Directing organizational action.
 Motivating people.
 Building and strengthening the firm’s
competencies and competitive capabilities.
 Creating and nurturing a strategy-supportive
work climate.
 Meeting or beating performance targets.

26. Managing the Strategy Execution Process
2–
 Staffing the firm with the needed skills and expertise.
 Building and strengthening strategy-supporting
resources and competitive capabilities.
 Organizing work effort along the lines of best practice.
 Allocating ample resources to the activities critical to
strategic success.
 Ensuring that policies and procedures facilitate rather
than impede effective strategy execution.

27. Managing the Strategy Execution Process
2–
 Installing information and operating systems that enable
effective and efficient performance.
 Motivating people and tying rewards and incentives
directly to the achievement of performance objectives.
 Creating a company culture and work climate conducive
to successful strategy execution.
 Exerting the internal leadership needed to propel
implementation forward and drive continuous
improvement of the strategy execution processes.

28. STAGE 5: EVALUATING PERFORMANCE
AND INITIATING CORRECTIVE
ADJUSTMENTS
2–
Evaluating Performance:
 Deciding whether the enterprise is passing the
three tests of a winning strategy—good fit,
competitive advantage, strong performance.
Initiating Corrective Adjustments:
 Deciding whether to continue or change the
firm’s vision and mission, objectives, strategy,
and/or strategy execution methods.
 Based on organizational learning.

29. THE ROLE OF THE BOARD OF DIRECTORS
IN CORPORATE GOVERNANCE
2–
Obligations of the Board of Directors:
 Critically appraise the firm’s direction, strategy, and
business approaches.
 Evaluate the caliber of senior executives’ strategic
leadership skills.
 Institute a compensation plan that rewards top
executives for actions and results that serve
stakeholder interests—especially shareholders.

30. Changes in Health Services
• Acute to chronic illness
• Curative to preventive medicine
• Restorative to comprehensive medicine
• Inpatient care to outpatient and homecare
• Individual orientation to community
orientation
• Isolated function to area-wise or regional
functions
• Tertiary and secondary to primary healthcare
• Episodic to total healthcare

31. Types of Hospitals
 Location-wise: Community health centres,
taluk hospital, district hospital, regional
hospital etc.
 General, Specialty or Super Specialty
Hospitals
 Profit and Non-profit Hospitals
 Teaching or non-teaching hospitals
 Age- wise classification i.e., pediatric,
geriatric hospitals etc.
 Sexwise,i.e.,zenana hospital only for females.
 Treatment wise ,i.e., dealing with allopathy,
Ayurveda, homeopathy, unani, yoga etc.

32. • Ownership i.e., public sector or private with individual or corporate
ownership
• General or special hospitals under social insurance schemes
• Charity hospitals run by individuals , groups, non-governmental
organization
• Acute care for dealing with emergencies or chronic care hospitals.

33. Healthcare Social Responsibility
• Hospitals have inbuilt environment right from its evolution, that has
been responsive to the society it serves and the public at large:
• Transparency in business
• Commitment to open communication about performance
• Patient safety and clinical excellence
• Access and affordability
• Working together with Stakeholders
• Commitment to community well being
• Economic Impact and community workforce development

34. Google’s Corporate Mission
Statement
“To organize the world’s information
and make it universally accessible and
useful.”
Following are the primary elements of Google’s
corporate mission:
 World’s information
 Organization
 Universal accessibility
 Usefulness

35.  The company fulfills the “world’s information”
component by crawling websites.
 The company organizes the information
through its proprietary computer algorithms.
 Google also fulfills the “universal
accessibility” component of its corporate
mission by offering its products worldwide. For
example, the company’s online search service,
blogging platform (Blogger.com), and video-
sharing platform (subsidiary YouTube) are
globally accessible.
 organizing of information makes results useful
to the individual user.

36. Google’s Corporate Vision
Statement
 “To provide access to the world’s
information in one click.”
 The company’s nature of business is a direct
manifestation of this vision statement.
 For example, Google’s most popular product is
its search engine service.
 This product enables people to easily access
information from around the world.
 Company applies its vision together with the
mission statement to maintain dominance as
an Internet technology, software, and
hardware business.

37. Following are the primary elements of the company’s
corporate vision:
 World’s information
 Access
 One click
 The company fulfills the “world’s information”
component of the vision statement by indexing
webpages and maintaining databases of the
resulting information.
 Google fulfills the “accessibility” component by
offering its products to everyone around the
world.

38.  The “one click” component of the
corporate vision refers to easy access to
information. The company fulfills this
component by offering innovative
products, such as the easy-to-use
Google Search