The importance of mission, vision and values for business strategy

What is a mission statement?

An organizational mission statement identifies a company’s goals. It should go beyond simply mentioning benchmarks and future aims to also include an explanation of how the organization will achieve its goals.

A mission statement is practical in and of itself because it helps with planning operations. Also, investors and stakeholders want clear information about company goals in order to make funding decisions and assess performance.

Mission statements also help inform daily operations. Decision-makers can take specific steps based on where the company is in relation to its mission. In other words, it can serve as a road map for hiring, budgeting, investing and strategizing. 

Example mission statement

To create a mission statement, look to other companies first for direction. For example, LinkedIn® offers a succinct, one-sentence mission statement that details its primary purpose. “The mission of LinkedIn is simple: connect the world’s professionals to make them more productive and successful.” With this sentence, LinkedIn offers insight into its purpose and also into its brand and what it plans to focus on as it develops.

What is a vision statement?

It is easy to confuse a mission and vision statement. Both have to do with an organization’s overall aims. While a mission statement takes a more practical approach to what a company plans to achieve from day one, a vision statement focuses on what a company aspires to become in the future. It explains how the business should look when it finishes its growth and development processes.

Because it is more aspirational, the vision statement may have less of an impact on day-to-day decisions. However, it does play a role in long-term planning, the formation of workplace culture, branding, and getting employees and investors to buy into the company’s plans.

Finally, many investors and employees want to be involved with ambitious organizations. Vision statements offer an opportunity to underscore this drive.

Example vision statement

Again, to create a vision statement, start by looking to successful companies for what a clear vision statement looks like. For example, Microsoft provides an example of an effective vision statement: “To help people and businesses throughout the world realize their full potential.”

Vision statements are typically more abstract than mission statements. This allows the company flexibility to develop and adjust to current conditions in the economy and its industry without contradicting its long-term vision.

Southwest Airlines provides an example of this with its vision statement: “To be the world’s most loved, most profitable, and most efficient airline.” Even if the budget carrier has to significantly adjust its operations due to passenger demand or fuel prices, it can justify these changes as necessary for moving toward its long-term aims.

Importance of mission, vision and values in business strategy

Mission, vision and core values statements are foundational elements of every company. Businesses without well-thought-out philosophies or frameworks lack direction, have weak company cultures and poor organization. Management may be unsure of what to prioritize, what kind of workers to hire and where to invest assets and human resources.

Here are some specific advantages of having mission, values and vision statements.

• Clear foundational statements can foster a positive work environment. They can help attract workers with the same values and interests as the company. These people are more likely to be passionate about their work and buy into the company’s long-term mission.
• Well-planned statements can also inform management styles within the organization. Professional values and ethical guidelines can guide personnel and disciplinary decisions and help craft workplace policies. Meanwhile, executives can make strategy, budgeting and resource allocation decisions using mission and vision statements as standards by which each is measured.
• Mission and vision statements can ensure uniform messaging. Consistency is key to building a strong company image and running effective marketing and PR campaigns.

Investors, stakeholders and other businesses will also look at these foundational statements to assess the company’s suitability for investment or partnerships.

How to create mission, vision and values statements

Regardless of the size of a company, anyone involved in starting or managing a business should be familiar with mission, vision and value statements.

Here are some parameters to keep in mind when crafting these business plan essentials:

• Be concise: Statements should be clear and brief without unnecessary language or broad terms. The statements should be memorable enough that employees, customers and managers can easily recall them.
• Be focused: It is tempting to add multiple clauses to your statements. However, focusing on a single goal or a set of closely related goals helps your statement serve its purpose of informing and guiding company actions.
• Consider the time frame: It is important to remember that mission statements are for short-term planning, while vision statements focus on the future and values need to be applicable from the start of operations.

With strong mission, values and vision statements, you can create a business plan that provides clear guidelines for operating, planning and developing your company.

Earn a business degree from University of Phoenix

If you’re looking to learn more about more general online business programs that prepare students with skills for a variety of career paths, consider a program at University of Phoenix. Whether you’re looking to build the fundamentals or advance your skill set, there are plenty of degrees and certificates to consider.

Associate of Arts with a concentration in Business Fundamentals — From management to accounting, skills learned in this program are essential for anyone looking to build an educational foundation in business. 

Bachelor of Science in Business — Knowledge of the ins and outs of running a business can spell the difference between success and failure in a competitive business world. 

Master of Business Administration — Prepare for higher leadership roles in an organization. This degree program can prepare graduates for careers as business managers, operations directors and more.

Master of Management — Take your understanding of business organization and management to an advanced level. This degree program is perfect for those with experience in the workforce who are looking to take on greater leadership roles. 

Doctor of Business Administration — Expand your understanding of organizations, work environments and industry. This program invites participants to delve into cutting-edge research in the field of business and develop skills for solving complex organizational problems.