Should we bin Mission Statements?
June 29, 2015
By Darryl Cooke
The disappointing thing about terms like ‘mission statements’ is that over a period of time they have become tarnished with years of misuse. As a result they lose their impact and power. They become just part of the bureaucracy and something a company must have, to be in with the in-crowd but without total engagement. A mission statement may suggest lofty goals and meaningless words and may have has lost its original impact of inspiring people with a compelling reason for being and core meaningful and aspirational values to strive for and a major challenge that will drive its leadership and people equally. As a result they are often seen as no longer relevant.
There are any number of major companies such as Enron, Royal Bank of Scotland, HBOS or Lehman Brothers who became notorious for the wrong reasons and who all had carefully crafted mission statements with all the right words in them but with leadership that failed to deliver.
But how an organisation defines its ambitions and purpose and how it articulates its goals and how it influences how people think and behave is clearly just as important as ever. A good mission statement can be galvanising and can trigger the success the leadership strive for. My advice is that to avoid using a now tainted phrase, you choose your own word to describe what you are doing? Your challenge, your call to arms, your calling, your purpose, your vision etc. Don’t worry about semantics and getting involved in the continuous debate between vision and values and purpose etc. Focus on the passion and whether it will provide an emotional commitment to your business? It’s almost impossible to achieve what you want without such focus.
Sam Walton started the first Walmart store in Arkansas. His vision was to open as many large discount stores as possible in small rural communities across the country. He was a strong leader and widely thought of as a man of integrity. He founded the organisation on three basic beliefs: respect for the individual, service to customers, and striving for excellence. At the core of it all was the commitment to ‘act with integrity’.
Where is Walmart now? Walmart’s current practices have deviated from their founders’ original vision. That change is not unusual- just look at our banks now and think about their founders and how they began and their values. No company starts out bad but a lot lose their way. The question is how- often their focus changes to making money or maximising shareholder value (another dreadful phrase) rather than the foundations upon which they were established by visionary entrepreneurs to build great businesses with employees, customers and the wider community at the centre and as the focus.
Jack Welch argued recently that ‘shareholder value is the dumbest idea in the World’. He added that ‘shareholder value is a result, not a strategy… Your main constituencies are your employees, your customers and your products.’ Paul Polman, CEO of Unilever has added his voice to a growing number of business leaders who argue that shareholder value is a misguided and potentially harmful goal for companies to pursue. He said that shareholders had benefitted as a result of his concentration on customers; ‘I drive this business model by focusing on the consumer and customer in a responsible way… And I know that shareholder value can come’.
Clearly defining a company’s purpose as specifically as possible and beyond shareholder value to what really matters in the long run is key. Only if employees have a crystal clear understanding of business purpose, goals, ethics and boundaries will they respond and be able to make decisions with confidence to take the organisation forward. Such clarity rarely exists today. The aim must be to:
- Articulate a purpose above and beyond profit or shareholder value in terms of the company’s clear social purpose
- Communicate it in every possible way
- Create a shared vision- engage with others who have the same passion to start the charge
- Recruit on values and buy in to the vision. Develop people on adherence to the challenge
- Walk the purpose, talk the values every day
- Put core and aspirational values on your executive team meeting agendas- promote actions that will enforce them.
- Understand that it’s a marathon and stay focused.
Don’t be put off by the overuse of the word ‘mission’- change it if needs be but understand that it is the start of your success.