strategic-management

Good mission statements identify the utility of a firm’s products to its customers. This
is why AT&T’s mission statement focuses on communication rather than on telephones; it
is why ExxonMobil’s mission statement focuses on energy rather than on oil and gas; it is
why Union Pacific’s mission statement focuses on transportation rather than on railroads;
it is why Universal Studios' mission statement focuses on entertainment rather than on
movies. The following utility statements are relevant in developing a mission statement:
Do not offer me things.
Do not offer me clothes. Offer me attractive looks.
Do not offer me shoes. Offer me comfort for my feet and the pleasure of walking.
Do not offer me a house. Offer me security, comfort, and a place that is clean and happy.
Do not offer me books. Offer me hours of pleasure and the benefit of knowledge.
Do not offer me CDs. Offer me leisure and the sound of music.
Do not offer me tools. Offer me the benefits and the pleasure that come from making
beautiful things.
Do not offer me furniture. Offer me comfort and the quietness of a cozy place.
Do not offer me things. Offer me ideas, emotions, ambience, feelings, and benefits.
Please, do not offer me things.
A major reason for developing a business mission statement is to attract customers
who give meaning to an organization. Hotel customers today want to use the Internet, so
more and more hotels are providing Internet service. A classic description of the purpose
of a business reveals the relative importance of customers in a statement of mission:
It is the customer who determines what a business is. It is the customer alone whose
willingness to pay for a good or service converts economic resources into wealth and
things into goods. What a business thinks it produces is not of first importance, especially
not to the future of the business and to its success. What the customer thinks
he/she is buying, what he/she considers value, is decisive—it determines what a
business is, what it produces, and whether it will prosper. And what the customer
buys and considers value is never a product. It is always utility, meaning what a
product or service does for him or her. The customer is the foundation of a business
and keeps it in existence. 15
Mission Statement Components
Mission statements can and do vary in length, content, format, and specificity. Most
practitioners and academicians of strategic management feel that an effective statement
should include nine components. Because a mission statement is often the most visible and
public part of the strategic-management process, it is important that it includes the nine
characteristics as summarized in Table 2-4, as well as the following nine components:
1. Customers—Who are the firm’s customers?
2. Products or services—What are the firm’s major products or services?
3. Markets—Geographically, where does the firm compete?
4. Technology—Is the firm technologically current?
5. Concern for survival, growth, and profitability—Is the firm committed to growth
and financial soundness?
6. Philosophy—What are the basic beliefs, values, aspirations, and ethical priorities of
the firm?
7. Self-concept—What is the firm’s distinctive competence or major competitive
advantage?
8. Concern for public image—Is the firm responsive to social, community, and
environmental concerns?
9. Concern for employees—Are employees a valuable asset of the firm?
Excerpts from the mission statements of different organizations are provided in
Table 2-5 to exemplify the nine essential mission statement components.
CHAPTER 2 • THE BUSINESS VISION AND MISSION 51