Purpose, mission, vision, and values

Times have changed indeed. After more than two years of the pandemic, business will never be the same. Customers have been used to utilizing digital channels to buy and use products; but at the same time, they look for physical interactions. Employees want to continue the hybrid model of working. Competitors are aplenty, as more startups join the digital business fray.

 

That is why CEOs and business owners ask fundamental questions – Why are we are we here? Where are we going? What are we doing? How do we get these? The answers to these questions make up the purpose, vision, mission, and values (PVMV) of an organization.

In our strategy consulting with organizations, we advise that the company’s PVMV must be revisited as there have been significant changes in the business and operating environment.

These will serve as a guidepost for the formulation of strategies and effective execution.

 

In revisiting the PVMV, the first thing we need to internalize and look closely is the purpose statement. It answers the question – why we are here and why we choose to exist together, beyond financial gain. It should be true for both the organization and you.

It starts with “We believe…” for the employee or any member of the organization to imbibe its true meaning. For example, Microsoft’s stated purpose is “We believe in what people make possible;” Sweden-based home furnishing company Ikea’s purpose is “We believe that connection is a human right;” and American Express’ purpose statement is “We believe it is noble to serve others.” It sets expectations, both internally (for leadership and employees) and externally (for customers and investors).

After the purpose statement, are the vision and mission statements. A company’s vision statement answers the question – Where are we going? It. says what the organization wishes to be like in some years’ time. Whereas a mission statement answers the question, “what we do, who we are.” To emphasize the importance of revisiting a company’s vision and mission, I always give the example off Microsoft.

 

In 1980, when Bill Gates was at the helm of Microsoft, he had a clear vision – “A computer on every desk and in every home”. It was a compelling vision that turned Microsoft into a software juggernaut that truly achieved its vision.

In 2000, Steve Ballmer took the helm as CEO and upheld the same vision, saying “We’re gonna put a computer on every desk in every home”, and described it as a “compelling vision”. Up until 2013, Microsoft’s vision was all about putting micro-computers and devices in homes; and this was happening during the growth of mobile phones, the internet, and cloud computing. From 2000 to 2013, Microsoft significantly lost its share value.

In 2014, Microsoft installed Sataya Nadella as its new CEO. Nadella. He adopted a new mission – “to empower every person and every organization on the planet to achieve more.”

Its new vision – “to help people and businesses throughout the world realize their full potential.” In 2015, the new headline was “Microsoft got its groove back”. In 2019, Microsoft breached the $1 trillion market capitalization, as earnings beat expectation.

 

Vision and mission statements should be concise or clear; and should reflect significant changes in your organization and the environment, to avoid the costly mistakes of Microsoft.

Once we have revisited and/or crafted the purpose, vision, and mission statements, it’s time to revisit the core values of the organization. Vales answer the question – How are we going to achieve our vision and mission? They are what drives and motivates us to act. It guides the organization members’ behavior like a North Star. Microsoft’ core values are Innovation, Diversity, and Inclusion, Corporate Social Responsibility, Philanthropies, and Environment. More common core values are trust, customer-centricity, and integrity.

In revisiting the core values of an organization, it is important to select those that are most relevant and significant at this point. The organization’s’ PVMV should nicely align with each other into a cohesive story flow.

 

They will dictate the strategies of the organization and the execution plan to achieve these strategies; and these are backed by evidence. According to Collins and Porras in their book Built to Last, purpose and values driven organizations outperformed the general market and comparison companies by 15:1 and 6:1, respectively. Another global study, the 2020 Zeno Strength of Purpose Study, revealed that consumers are four to six times more likely to purchase, protect, and champion purpose-driver companies.

There is a business case for a well-crafted purpose, vision, mission, and values.

The author is the Founder and CEO of Hungry Workhorse, a digital and culture transformation consulting firm. He is the Chairman of the Information and Communication Technology Committee of the Financial Executives Institute of the Philippines (FINEX). He is a Fellow at the US-based Institute for Digital Transformation. He teaches strategic management in the MBA Program of De La Salle University. The author may be emailed at rey.lugtu@hungryworkhorse.com

Source: https://mb.com.ph/2022/06/14/purpose-mission-vision-and-values/