Chapter 4 Mission, Objectives and Goals
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1 Chapter 4 Mission, Objectives and Goals 1
2 Learning Objective To understand how organisations define the mission To assess the importance and relevance of Strategic Management To understand strategic planning and strategic decisions To identify levels of strategy To understand strategic management process To understand the role of stakeholders in defining mission, objectives and goals 2
3 Introduction to Mission, Objectives and Goals Main purpose of any organisation is to create value for all its stakeholders Each organisation has vision, mission and objective which are achieved by formulation of strategy and execution Mission identified the scope of an organisation s operations and its offering to the various stakeholders 3
4 Introduction to Mission, Objectives and Goals Objectives are those ends which the organisation seeks to achieve by its existence and operations Goals is an intermediate result to be achieved within a certain time as part of the overall strategic plan or an objective The vision of an organisation translates into strategy which has multiple objectives to achieve the purpose 4
5 Vision and Mission Vision is a value statement that reflects the principle and purpose of an organisation and is the pivot around which the corporate strategy revolves A mission statement reflects the long term vision of an organisation in terms of what it wants to be and whom it wants to serve A mission describes an organisation s purpose, its customers, products, services, markets, philosophy and values 5
6 Vision and Mission and Objectives - Example Vision can be To become the most loved consumer services brand enriching the life of its customers and employees Mission can be To produce products and services that not only meet the customer s needs but also enhances their lifestyle and provides world class employment to its employees Objective can be - To introduce new technologies and innovative features to make the product different than the competitors 6
7 Vision and Mission and Objectives Vision statement defines the organisations purpose in terms of the organisation s values rather than bottom line measures Vision statement communicates both the purpose and value of the organisation For employees vision statement gives direction about how they are expected to behave and inspires them to give their best 7
8 Mission Mission is an enduring statement of purpose that distinguishes one business from other similar firms Mission statement identifies scope of company s operations in- Product Terms and Market Terms Mission statement reveal the long term vision of an organisation in terms of what it wants to be and whom it wants to serve. 8
9 Attributes of Mission Statement Define what the organisation is and what the organisation aspires to be Limited enough to excludes some ventures and broad enough to include creative growth Distinguish a given organisation from all others Serve as a framework for evaluating both current and prospective activities State in sufficiently clear terms 9
10 Criteria for mission statement key elements Clear articulation, Relevant to the organisation s culture and share values Current and should reflect internal and external environment changes Should be written in a positive and inspiring tone Should establish the individuality and uniqueness Should be enduring and adapted to the target audience 10
11 Formulation of Mission Key questions Basic purpose of the organisation and how to envision the future of the company Unique about the organisation and how does it create its unique value proposition Impact it wants to create on various stakeholders Organisation s principal economic concern Basic beliefs, values and philosophical priorities of the company 11
12 Mission and Strategy Mission sets the direction for the strategy development of an organisation There is a need to define the strategy and mission helps to define scope Each business unit / function has own strategy which to be aligned with the overall mission of the Corporate / Organisation 12
13 Strategic Objectives Objectives form the basis for the functioning of the organisation and help define the organisation in its environment Objectives are those ends which organisation seeks to achieve by its existence Objectives cover long term aims of the company breaking down the strategy into different and specific initiatives 13
14 Category of objectives Focus on improvement of its Financial Performance Undertake initiatives to enhance customer experience Improve the operational excellence Ensure employee satisfaction Creation of unique brand and organisational culture 14
15 Levels of Objectives Organisation has multiple levels of objectives which include Corporate Objective SBU Objective Functional Objective Individual objectives Corporate objectives are to be formulated and pursued by the Board of Directors SBU objectives are to be formulated and owned by SBU leadership team 15
16 Levels of Objectives Functional / Department objectives formulated by function like Sales, Marketing, Production, Finance and HR Each division or group will formulate the individual objectives like sales target etc. Organisation has a hierarchy of objectives for different levels of leadership across the organisation 16
17 Socio-economic objectives Every organisation has to follow balanced approach towards economic and social objectives Economic objectives could be Return on Investment, profitable growth, market share and innovation Social objectives is to protect customer s interest, interest of workers and employees and overall in the interest of the society 17
18 Global Influences As industry globalises, the organisation s mission and international involvements develops a strong linkage Global factors that exert influence over businesses and the strategy are- Advantage of labour costs Availability of technology expertise Leveraging global offshore delivery expertise Multi-skilled human resources 18
19 Indian Scenario Indian business houses are evolving Increasingly CSR and contribution towards the society is becoming the norms Over a period of time, the CSR initiatives will be matured to become at par with the global counter parts. 19
20 Summary Vision, Mission, Objective and Goals are an integral part of the strategy development process The statements should be clearly articulated and communicated to stakeholders In addition to business objectives, organisation also need to focus on social interest. 20
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