Mission Statements

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By Erica Olsen • Published on 04-03-10

Criteria of a Good Mission Statement

Changing the mission or creating an organization’s first mission statement is a process of gathering ideas and suggestions for the mission and honing them into a short, sharply focused phrase that meets specific criteria.

An effective mission statement clearly defines who the customer is and what services and products the business intends to provide. It also serves as a guide for day-to-day operations and as the foundation for future decision-making. The following are criteria for a good mission statement:

The Mission Statement Focuses on Satisfying Customer Needs A mission statement should focused on satisfying customer needs rather than being focused on the product. Products and technologies eventually become outdated, but basic market needs may last forever. A market-oriented mission statement defines the business in terms of satisfying basic customer needs. For examples refer to the following “Market-Oriented Business Definitions” table. (Kotler p.49)

The Mission Statement Tells “Who” Our Customers are. (Thompson Strickland, p.30) Who is being satisfied? A company should define the type of customers it wishes to serve. Which customer groups it is targeting. Customer groups are relevant because they indicate the market to be served, the geographic domain to be covered, and the types of buyers the firm is going after.

The Mission Statement Explains “What” Customer Needs Our Company is Trying to Satisfy. What customer needs is the company trying to satisfy? A company should define the particular needs of those customers groups it wishes to satisfy. A product or service becomes a business when it satisfies a need or a want.

The Mission Statement Explains “How” Our Company will Serve its Customers. How customers’ needs are satisfied? A company should define the means or technology by which it will serve the target market and satisfy the customer’s needs. By incorporating Who, What and How the firm will be perceived and act more customer & market-oriented. It will be perceived as a customer-satisfying entity, not a product-producing entity. (Kerin & Peterson, p.2.)

McDonald’s business mission is built around:

  serving a limited menu of hot, tasty food (what) quickly in a clean, friendly restaurant for a good value (how)

  to a broad base of fast-food customers worldwide (who).

The Mission Statement Fits the Current Market Environment Missions should fit the current market environment. (Kotler p.52) ” Girl Scouts would not recruit successfully in today’s environment with their former mission: “to prepare young girls for motherhood and wifely duties.”

The Mission Statement is Based on Our Competitive Advantage Competitive advantage arises from leveraging a firm’s unique skills and resources to implement value-creating strategy that competitors cannot implement as effectively. Your company should base its mission on a competitively superior internal strength or resource that the company performs well in comparison to its competitors.

The Mission Statement is Based on Our Distinctive Core Competencies. The organization should base its mission on its distinctive competencies. (Kotler p.52) A distinctive core competency is a competitively superior company resource that the company performs well in comparison to its competitors.(Thompson Strickland) It needs to stay focused on specific traits (i.e., quality, customer service) and on target or niche markets. McDonald’s core competence is providing low-cost food and fast service to large groups of customers.

The Mission Statement Motivates and Inspires Employee Commitment Mission statements should be motivating. It should not be stated as making more sales or profits. A company’s employees need to feel that their work is significant and that it contributes to people’s lives. Visionary companies set a purpose beyond making money. Even though profits may not be part of these companies’ mission statements, they are the inevitable results.(Kotler p.53).

The Mission Statement is Realistic Mission statements should be realistic. The company should avoid making the mission too narrow or too broad. (Kotler p.50)

Southwest Airlines would be deluding itself if it adopted the mission to become the world’s largest airlines. Too broad – “providing society with superior products and service – innovations and solutions that satisfy customer needs and improve the quality of life.” Merck Too narrow – providing toys has proved too narrow a scope for Toys-R-Us

The Mission Statement is Specific, Short and Sharply Focused Mission statements should be specific. Vague or generic mission statements lack resonance and meaning. They won’t be remembered by anyone, and will likely be dismissed as too difficult to understand. Many mission statements are written for public relations purposes and lack specific, workable guidelines. It is a precise statement of purpose. (Kotler p.51)

Too general – “We want to become the leading company in this industry by producing the highest-quality products with the best service at the lowest prices.” Very specific – Celestial Seasonings’ mission statement is “Our mission is to grow and dominate the U.S. specialty tea market by exceeding consumer expectations with: The best tasting, 100% natural hot and iced teas, packaged with Celestial art and philosophy, creating the most valued tea experience.”

It should be memorable. Describe the essence of the business in words your employees and customers can remember you by. Peter Drucker says the mission should “fit on a T-shirt,” yet not be a slogan.. Don’t use the mission statement as an essay or a vehicle for abstract philosophy. Words should be chosen for their meaning rather than beauty, for clarity over cleverness. The best mission statements are plan speech with no technical jargon and no adornments.

International Red Cross – “To serve the most vulnerable”

The Mission Statement is Clear and Easily Understood. Develop your mission statement to a “party level.” A simple, clear, “party level” mission statement can be used to tell people you meet at a party or on airplanes why your company exists. At the same time it needs to give your company team as a profoundly simple focus for everything it does as a firm. (Bobb Beihl)

The Mission Statement says What We Want to be Remembered for. A mission statement says what, in the end, you want to be remembered for. It is actually an epitaph in present tense. What would you want your epitaph to read some day? Your ideal can provide a profoundly simple insight into your purpose for existing today. (Bobb Beihl)