Completed Corporate Strategy -mba 29-assignment 1-muleba Matafwali
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CAVENDISH UNIVERSITY ZAMBIA ASSIGNMENT BRIEF AND FEEDBACK FORM STUDENT NUMBER: _ 081202111
LECTURER: SUBJECT:
COHORT: MBA12 (DL)
Mr. Peter Kanjiji
MBA 29 – Corporate Strategy
ASSIGNMENT NO. ONE
DATE HANDED OUT:
DATE DUE IN:
14th May 2009.
TBA
ASSIGNMENT BRIEF
How does the Mission Statement influence the strategic posture of an organization?
STUDENT INSTRUCTIONS: 1. This form must be attached to the front of your assignment 2. The assignment must be handed in without fail by the submission date (see assessment schedule for your course) 3. Ensure that the submission form is date stamped by the reception staff when you hand it in 4. Late submission will not be entertained unless with prior agreement with the subject tutor 1. All assessable assignments must be word processed
ASSIGNMENT GUIDANCE This assignment is intended to assess the student’s knowledge in all of the following areas. However, greater emphasis should be given to those items marked with a
(Tutor: - please tick as applicable) 1
Please Tick.
ASSESSABLE SKILLS Good and adequate interpretation of the questions Knowledge and application of the relevant theories Use of relevant and practical examples to back up theories Ability to transfer and relate subject topics to each other Application or use of appropriate models Evidence of library research Knowledge of theories Written Business English communication skills Use of visual (graphs) communications Self Assessed ‘time management’ Evidence of field research
MARKS (Administration only *)
LECTURERS FEEDBACK How does the Mission Statement influence the strategic posture of an organization?
*
2
Table of Contents
Item Page # ASSIGNMENT BRIEF........................................................................................................ 1 Table of Contents.................................................................................................................. 3 Introduction.......................................................................................................................... 4 Main Benefits Attributed to Mission Statements in Strategy Planning..................................5 Conclusion............................................................................................................................ 8 Bibliography..........................................................................................................................9
3
Introduction This essay will discuss how a mission statement influences the strategic posture of an organization. However before going further into the discussion, it is important to discuss what the key terms in the essay mean. The mission takes on the issue of what the company is today, and what it will be in the future. Many companies put the mission statement into writing and use it as the overarching principle by which the company operates. This mission statement can be made available to employees, investors, creditors, customers and any other stakeholders associated with the organization. Ideally, all activities undertaken by individuals within the organization are in support of the mission statement. Because of this, the statement is supposed to be clearly stated, concise and broad in scope. When preparing an organization’s Mission Statement it is thus important to be clear and succinct, incorporating socially meaningful and measurable criteria and consider approaching it from a grand scale. Other scholars have defined “a mission statement as an organization's vision translated into written form” (Ian, 1992, p. 18). It makes concrete the leader's view of the direction and purpose of the organization. For many corporate leaders it is a vital element in any attempt to motivate employees and to give them a sense of priorities. Strategy, in general, refers to how a given objective will be achieved. Consequently, strategy in general is concerned with the relationships between ends and means, that is, between the results we seek and the resources at our disposal. Strategy and tactics are both concerned with formulating and then carrying out courses of action intended to attain particular objectives. For the most part, strategy is concerned with deploying the resources at your disposal whereas tactics is con-cerned with employing them. Together, strategy and tactics bridge the gap between ends and means
Key elements of the Mission Statement include obligations to stakeholders, scope of the business, sources of competitive advantage and view of the future. A mission statement plays a key role in strategic posture of the organization as it answers questions which include the following: 1.
What is the purpose of organization? 4
2.
What is unique about the organization?
3.
What are its principal products and markets?
4.
What are its values?
5.
Where is it hoping to be in five or ten years' time
Main Benefits Attributed to Mission Statements in Strategy Planning Having thoroughly understood an organization's internal and external environment, managers establish a mission statement to create a five-to ten-year vision of the company. A mission statement documents the service or product the company provides to the marketplace and the unique way in which it distinguishes itself from other companies. It also indicates the target group of customers that the company serves. An example of this type of mission statement is provided by Courtyard by Marriott. It reads “Courtyard by Marriott is serving economy-and quality-minded frequent business travelers with a premier, moderate-priced lodging facility that is consistently perceived as clean, comfortable, well maintained, attractive, and staffed by friendly, attentive, and efficient people” (Bart, 1997, p10). This mission statement simply put indicates the product and service provided to the target customers and the way in which it will be done. Mission statements serve several purposes in strategic management. First, they provide direction for the organization. As a firm engages in its strategic planning process it compares its objectives with the path it has set for itself. If any of the goals suggest a deviation from the purpose of the organization, managers must decide if the goal is sufficiently important to warrant a change in the mission statement. Otherwise, the objective might be dropped. With this in mind managers are typically careful to write mission statements that are broad enough to encourage growth but specific enough to give direction. A second purpose of mission statements “is to create a shared sense of purpose and inspiration among employees. (Silbiger, 1999, P7). In some organizations, employees are required to memorize the mission statement so that they will understand what appropriate behavior is and what is not. For this reason, most mission statements are relatively short so that the purpose of the company remains clearly in the minds of its employees. Further, many 5
companies seek the input of their employees in creating a mission statement so as to create a document that is owned by all. Thirdly, “mission statements are also external documents which communicate to the outside world the values and goals of the organization” (Hindle, 2001, P6). Unfortunately, some companies create mission statements as a marketing document and then fail to live up to that vision of themselves. For a mission statement to be effective, it must be a living document that motivates behavior Fourthly, mission statements help companies to focus their strategy by defining some boundaries within which to operate. A mission statement helps an organization to set up operating boundaries. Fifthly, “mission statements can define the dimensions along which an organization's performance is to be measured and judged (Porras, J., 1994). For instance, when people measure and judge the performance Disney World, they think happiness and smile. Therefore truly Disney World is living up to its mission of simply making people happy. When a mission is outlined, it will help the organization to strategize for success. To meet and exceed customer satisfaction, the business team needs to follow an overall organizational strategy. “A successful strategy adds value for the targeted customers over the long run by consistently meeting their needs better than the competition does (Bartkus, 2000, P15)”. Organizations only prosper by achieving strategy. To summarize the above points, mission statements can suggest standards for individual ethical behavior communicate the direction of the organization, help make day-to-day operating decisions, keep the organization focused and also motivate employees.
Examples of Mission Statement Playing a Key Role in Strategy Formulation and Execution at Boeing For most companies that are market leaders, a company's mission is its reason for being. The mission often is expressed in the form of a mission statement, which conveys a sense of purpose to employees and projects a company image to customers. In the strategy formulation 6
process, the mission statement sets the mood of where the company should go and thus is the starting point of strategy formulation. The example given here is that of Boeing Company and how it uses a mission statement it its strategy formulation ventures. The current mission statement of Boeing is “People working together as one global company for Aerospace leadership” (Stevens, 2001, P 1) The Boeing Company was founded in 1916. It was a response to a growing interest in air power by the military. The primary focus of the company was the development of military jets. However, what made a company great fame and success was the introduction of commercial aircraft. The company introduced the world's first successful long-range commercial plane and continued to build on the success by making a mid-range B-727, short-range B-737, and then with the introduction of B-747. “Transformation of Boeing from a mostly commercial airplane company to an enterprise that would capture all aspects aerospace business started in 1996 with acquisition of Rockwell Aerospace. This transformation continued with successful acquisition of McDonnell Douglas in 1997 and purchase of Hughes Space (Jeppesen, 2000, p 13). The company’s business strategy and commitment to its mission made it the biggest and the most balanced aerospace company of the world. Boeing is also the largest exporter of the United States. Boeing Company together with its subsidiaries operates in three principal segments-Commercial
Airlines,
Military
Aircraft
and
Missiles,
and
Space
and
Communications. Every day more than three million people travel on Boeing airplanes, 335 satellites put into orbit by Boeing pass overhead and 6,000 military aircrafts stand on guard with military forces of the untied States and twenty other countries. (Bart, 2000, p 13).. It is no doubt therefore that Boeing is truly living to its mission statement which states thatToday Boeing stands as the world's leading aerospace company and the largest manufacturer of commercial jetliners and military aircraft combined. Additionally, Boeing designs and manufactures rotorcraft, electronic and defense systems, missiles, satellites, launch vehicles and advanced information and communication systems. As a major service provider to NASA, Boeing operates the Space Shuttle and International Space Station. The company also provides
7
numerous military and commercial airline support services. Boeing has customers in more than 90 countries around the world and is one of the largest U.S. exporters in terms of sales. Headquartered in Chicago, Boeing employs more than 160,000 people across the United States and in 70 countries, with major operations in the Puget Sound area of Washington State, southern California and St. Louis. Total company revenues for 2008 were $60.9 billion.
Conclusion According to research done by Bain & Company, mission statements are one of the most frequently used management tools (Stokke, 1991, P41). Organizations spend thousands of hours and dollars developing mission statements and then more resources again on public relations to unfold them to their stakeholders. This is not surprising when you review the often-stated benefits of mission statements: The easiest and most practical way of referring to a mission is the journey. However, just having a mission and/or vision statement, even if they are included in a planning document, posted on a plaque on the wall or provided to employees on business cards certainly does not, unto itself, ensure success. Mission are management tools that if used appropriately, have the potential to help improve your organization's probability of success. However, it's important to keep in mind, that these are only two of the many tools available to your organization in the development of your strategy.
8
Bibliography Notes and References 1.
Bart, C.K. "Sex, Lies, and Mission Statements", Business Horizons. November-
December 1997, 9-18.http://www.charityville.com/cv/research/rstrat5.html 2.
Collins, Porras, J., 1994, "Built to Last: Successful Habits of Visionary Companies"
3.
Jeppesen
Sanderson
2000,
Competitive
Strategy.
http://www.boeing.com/companyoffices/aboutus/brief.html. 4. Mark
Stevens,
2001"
Extreme
Management",
http://www.lotsofessays.com/viewpaper/1694633.html 5. Steven
Silbiger,
1999,
"The
10-day
MBA",
http://www.lotsofessays.com/viewpaper/1694633.html 6.
Stokke, R.R., (1991). Visioning (and preparing for) the future. Technological forecasting
and social change, 40, 73-86. 7. Tim Hindle, 2001, "Guide to Management Ideas", [email protected] 8.
Wilson, Ian (1992). Realizing the power of strategic vision. Long range planning, 25 (5),
18-28. http://www.charityville.com/cv/research/rstrat5.html
9
LECTURER: SUBJECT:
COHORT: MBA12 (DL)
Mr. Peter Kanjiji
MBA 29 – Corporate Strategy
ASSIGNMENT NO. ONE
DATE HANDED OUT:
DATE DUE IN:
14th May 2009.
TBA
ASSIGNMENT BRIEF
How does the Mission Statement influence the strategic posture of an organization?
STUDENT INSTRUCTIONS: 1. This form must be attached to the front of your assignment 2. The assignment must be handed in without fail by the submission date (see assessment schedule for your course) 3. Ensure that the submission form is date stamped by the reception staff when you hand it in 4. Late submission will not be entertained unless with prior agreement with the subject tutor 1. All assessable assignments must be word processed
ASSIGNMENT GUIDANCE This assignment is intended to assess the student’s knowledge in all of the following areas. However, greater emphasis should be given to those items marked with a
(Tutor: - please tick as applicable) 1
Please Tick.
ASSESSABLE SKILLS Good and adequate interpretation of the questions Knowledge and application of the relevant theories Use of relevant and practical examples to back up theories Ability to transfer and relate subject topics to each other Application or use of appropriate models Evidence of library research Knowledge of theories Written Business English communication skills Use of visual (graphs) communications Self Assessed ‘time management’ Evidence of field research
MARKS (Administration only *)
LECTURERS FEEDBACK How does the Mission Statement influence the strategic posture of an organization?
*
2
Table of Contents
Item Page # ASSIGNMENT BRIEF........................................................................................................ 1 Table of Contents.................................................................................................................. 3 Introduction.......................................................................................................................... 4 Main Benefits Attributed to Mission Statements in Strategy Planning..................................5 Conclusion............................................................................................................................ 8 Bibliography..........................................................................................................................9
3
Introduction This essay will discuss how a mission statement influences the strategic posture of an organization. However before going further into the discussion, it is important to discuss what the key terms in the essay mean. The mission takes on the issue of what the company is today, and what it will be in the future. Many companies put the mission statement into writing and use it as the overarching principle by which the company operates. This mission statement can be made available to employees, investors, creditors, customers and any other stakeholders associated with the organization. Ideally, all activities undertaken by individuals within the organization are in support of the mission statement. Because of this, the statement is supposed to be clearly stated, concise and broad in scope. When preparing an organization’s Mission Statement it is thus important to be clear and succinct, incorporating socially meaningful and measurable criteria and consider approaching it from a grand scale. Other scholars have defined “a mission statement as an organization's vision translated into written form” (Ian, 1992, p. 18). It makes concrete the leader's view of the direction and purpose of the organization. For many corporate leaders it is a vital element in any attempt to motivate employees and to give them a sense of priorities. Strategy, in general, refers to how a given objective will be achieved. Consequently, strategy in general is concerned with the relationships between ends and means, that is, between the results we seek and the resources at our disposal. Strategy and tactics are both concerned with formulating and then carrying out courses of action intended to attain particular objectives. For the most part, strategy is concerned with deploying the resources at your disposal whereas tactics is con-cerned with employing them. Together, strategy and tactics bridge the gap between ends and means
Key elements of the Mission Statement include obligations to stakeholders, scope of the business, sources of competitive advantage and view of the future. A mission statement plays a key role in strategic posture of the organization as it answers questions which include the following: 1.
What is the purpose of organization? 4
2.
What is unique about the organization?
3.
What are its principal products and markets?
4.
What are its values?
5.
Where is it hoping to be in five or ten years' time
Main Benefits Attributed to Mission Statements in Strategy Planning Having thoroughly understood an organization's internal and external environment, managers establish a mission statement to create a five-to ten-year vision of the company. A mission statement documents the service or product the company provides to the marketplace and the unique way in which it distinguishes itself from other companies. It also indicates the target group of customers that the company serves. An example of this type of mission statement is provided by Courtyard by Marriott. It reads “Courtyard by Marriott is serving economy-and quality-minded frequent business travelers with a premier, moderate-priced lodging facility that is consistently perceived as clean, comfortable, well maintained, attractive, and staffed by friendly, attentive, and efficient people” (Bart, 1997, p10). This mission statement simply put indicates the product and service provided to the target customers and the way in which it will be done. Mission statements serve several purposes in strategic management. First, they provide direction for the organization. As a firm engages in its strategic planning process it compares its objectives with the path it has set for itself. If any of the goals suggest a deviation from the purpose of the organization, managers must decide if the goal is sufficiently important to warrant a change in the mission statement. Otherwise, the objective might be dropped. With this in mind managers are typically careful to write mission statements that are broad enough to encourage growth but specific enough to give direction. A second purpose of mission statements “is to create a shared sense of purpose and inspiration among employees. (Silbiger, 1999, P7). In some organizations, employees are required to memorize the mission statement so that they will understand what appropriate behavior is and what is not. For this reason, most mission statements are relatively short so that the purpose of the company remains clearly in the minds of its employees. Further, many 5
companies seek the input of their employees in creating a mission statement so as to create a document that is owned by all. Thirdly, “mission statements are also external documents which communicate to the outside world the values and goals of the organization” (Hindle, 2001, P6). Unfortunately, some companies create mission statements as a marketing document and then fail to live up to that vision of themselves. For a mission statement to be effective, it must be a living document that motivates behavior Fourthly, mission statements help companies to focus their strategy by defining some boundaries within which to operate. A mission statement helps an organization to set up operating boundaries. Fifthly, “mission statements can define the dimensions along which an organization's performance is to be measured and judged (Porras, J., 1994). For instance, when people measure and judge the performance Disney World, they think happiness and smile. Therefore truly Disney World is living up to its mission of simply making people happy. When a mission is outlined, it will help the organization to strategize for success. To meet and exceed customer satisfaction, the business team needs to follow an overall organizational strategy. “A successful strategy adds value for the targeted customers over the long run by consistently meeting their needs better than the competition does (Bartkus, 2000, P15)”. Organizations only prosper by achieving strategy. To summarize the above points, mission statements can suggest standards for individual ethical behavior communicate the direction of the organization, help make day-to-day operating decisions, keep the organization focused and also motivate employees.
Examples of Mission Statement Playing a Key Role in Strategy Formulation and Execution at Boeing For most companies that are market leaders, a company's mission is its reason for being. The mission often is expressed in the form of a mission statement, which conveys a sense of purpose to employees and projects a company image to customers. In the strategy formulation 6
process, the mission statement sets the mood of where the company should go and thus is the starting point of strategy formulation. The example given here is that of Boeing Company and how it uses a mission statement it its strategy formulation ventures. The current mission statement of Boeing is “People working together as one global company for Aerospace leadership” (Stevens, 2001, P 1) The Boeing Company was founded in 1916. It was a response to a growing interest in air power by the military. The primary focus of the company was the development of military jets. However, what made a company great fame and success was the introduction of commercial aircraft. The company introduced the world's first successful long-range commercial plane and continued to build on the success by making a mid-range B-727, short-range B-737, and then with the introduction of B-747. “Transformation of Boeing from a mostly commercial airplane company to an enterprise that would capture all aspects aerospace business started in 1996 with acquisition of Rockwell Aerospace. This transformation continued with successful acquisition of McDonnell Douglas in 1997 and purchase of Hughes Space (Jeppesen, 2000, p 13). The company’s business strategy and commitment to its mission made it the biggest and the most balanced aerospace company of the world. Boeing is also the largest exporter of the United States. Boeing Company together with its subsidiaries operates in three principal segments-Commercial
Airlines,
Military
Aircraft
and
Missiles,
and
Space
and
Communications. Every day more than three million people travel on Boeing airplanes, 335 satellites put into orbit by Boeing pass overhead and 6,000 military aircrafts stand on guard with military forces of the untied States and twenty other countries. (Bart, 2000, p 13).. It is no doubt therefore that Boeing is truly living to its mission statement which states thatToday Boeing stands as the world's leading aerospace company and the largest manufacturer of commercial jetliners and military aircraft combined. Additionally, Boeing designs and manufactures rotorcraft, electronic and defense systems, missiles, satellites, launch vehicles and advanced information and communication systems. As a major service provider to NASA, Boeing operates the Space Shuttle and International Space Station. The company also provides
7
numerous military and commercial airline support services. Boeing has customers in more than 90 countries around the world and is one of the largest U.S. exporters in terms of sales. Headquartered in Chicago, Boeing employs more than 160,000 people across the United States and in 70 countries, with major operations in the Puget Sound area of Washington State, southern California and St. Louis. Total company revenues for 2008 were $60.9 billion.
Conclusion According to research done by Bain & Company, mission statements are one of the most frequently used management tools (Stokke, 1991, P41). Organizations spend thousands of hours and dollars developing mission statements and then more resources again on public relations to unfold them to their stakeholders. This is not surprising when you review the often-stated benefits of mission statements: The easiest and most practical way of referring to a mission is the journey. However, just having a mission and/or vision statement, even if they are included in a planning document, posted on a plaque on the wall or provided to employees on business cards certainly does not, unto itself, ensure success. Mission are management tools that if used appropriately, have the potential to help improve your organization's probability of success. However, it's important to keep in mind, that these are only two of the many tools available to your organization in the development of your strategy.
8
Bibliography Notes and References 1.
Bart, C.K. "Sex, Lies, and Mission Statements", Business Horizons. November-
December 1997, 9-18.http://www.charityville.com/cv/research/rstrat5.html 2.
Collins, Porras, J., 1994, "Built to Last: Successful Habits of Visionary Companies"
3.
Jeppesen
Sanderson
2000,
Competitive
Strategy.
http://www.boeing.com/companyoffices/aboutus/brief.html. 4. Mark
Stevens,
2001"
Extreme
Management",
http://www.lotsofessays.com/viewpaper/1694633.html 5. Steven
Silbiger,
1999,
"The
10-day
MBA",
http://www.lotsofessays.com/viewpaper/1694633.html 6.
Stokke, R.R., (1991). Visioning (and preparing for) the future. Technological forecasting
and social change, 40, 73-86. 7. Tim Hindle, 2001, "Guide to Management Ideas", [email protected] 8.
Wilson, Ian (1992). Realizing the power of strategic vision. Long range planning, 25 (5),
18-28. http://www.charityville.com/cv/research/rstrat5.html
9
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