Advantages and Disadvantages of having a Mission Statement

Mission statement is a summary statement of a company’s or organization’s purpose about what it wants to accomplish in the larger environment. Mission statement is playing an important role with the overall strategic planning of an organization. All of the strategic planning of an organization should base on the mission of an organization that had been set. Strategic planning include all the long-range plans, strategic plans and also annual plans which include decision making about the human resource management, production and operation, finance and it is also concerned about the marketing planning.

  • A well-defined mission statement is very important to guide people in the organization, clearly defines who the customer is and what services and products the businesses are intended to provide. A good mission statement should contain some criteria. First, a good mission statement should be market-oriented. A market-oriented mission statement focuses on satisfying customer’s needs. A mission statement should focus on satisfying customer needs rather than being focused on the product or service. This is because products and technologies will eventually become outdated, but basic market needs may last forever. For instance, mission of Disney is not simply run theme park. Its mission is to “create fantasies which is a place where America still works the way it’s supposed to.
  • A good mission statement should also base on the company’s competitive advantage. An organization should base its mission on its distinctive competencies which is a competitively superior company resource that the company performs well in comparison to its competitors. It needs to stay focused on specific traits of target or niche markets such as quality of products, customer service before and after sales and so on. This can ensure the customers know more about the advantages of the company and then create customer’s loyalty. For instance, McDonald’s core competence is providing low-cost food and fast service to large groups of customers, especially for the younger group.
  • Besides that, good mission statements should be motivating. The mission statement should be able to inspire commitment among employees, customers, partners, and funding agencies about what this company will do or produce. It should not focus on making more sales or profit to prevent employees feel stress and demotivated. A company should make their employees feel that their work are significant and meaningful by contributing in human’s live. Some organizations highlight the inspirational value of their mission statement above all else and using it to express the company’s philosophy and values.
  • A mission statement should be realistic. Mission statement should be able to achieve and a company should avoid to makes the mission too narrow or too broad until beyond its ability to achieve. Mission statement that includes everything or over promise will not give a clear indication of what the business is about to customers. Besides that, an unrealistic mission statement will not have great credibility and this will decrease the motivation of employees to achieve it. Instead, the best mission statements are direct and powerful. Example of the mission that is too broad is “providing society with superior products and services through innovations and solutions that satisfy customer needs and improve the quality of life.” Example of mission that too narrow is “providing toys” has proved too narrow a scope for Toys-R-Us.
  • Furthermore, a good mission statement should be specific, short and concise. A long, vague or generic mission statement is lack of resonance and meaning. They will not be remembered by anyone because it is too long and vague, and will likely be dismissed by employees or customers as it is 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. The mission statement should not be longer than 25 words because if the mission is too long, it will make employees forget easily. Some consultants recommended that the mission statement should be short enough that an employee can easily remember it and readily repeat it.

Advantages of Having a Good Mission Statement

If a company do not know where it is going, any road will get it there. This is why every company needs a mission statement. Mission statements are quite popular among the large companies. For instance, Boston based consultants Bain & Co. recently surveyed the use of mission statements. More than 9 out of 10 Fortune 500 firms use them. They are more widely used than another management tools. Why is it so? This is because the cost of creating a mission statement is small, and it gives a useful guide to the company in the marketing planning. Company can operating their business well without a high cost in create the mission statement.

Besides that, with a good mission statement, employees do not have to run to some rulebook every time they make a decision if they live by the guiding principles. They can simply look at the mission statement to remind them what their boss would have them to do. This can prevent a lot of meetings that annoy the employees. This can save the time and reduce stress of the employees caused by meetings. Therefore, employees can perform well in marketing planning without any feel of uncomfortable and work in condition of pressure.

Furthermore, the process of defining a mission statement will help managers of a company to determine whether the scope of their effort is too big and unnecessarily competes with incumbents or is too small and does not capture the real market opportunity. A too big scope of their effort can lead to big and unnecessary expenses. On the other hand, a too small scope of their effort can cause the company become uncompetitive in the market as well. A too big or too small effort will affect the company in its performance.

Another advantage comes from creating the mission statement itself. Unless we are in a business by ourselves, the mission is created usually by gathering people to give opinion about what kind of business to start and what the people want the business to do. The act of creating a mission statement helps people talk about these things exactly, and helps to generate a positive regard for the business the group is about to undertake.

Other than that, mission statements resemble all guide, they characterize where the corporation stands as of now and where it wants to take it in due course, and how it will accomplish the company targets. Therefore, when a shareholder or a salesperson reads the mission statement, it provides them an impression of the whole corporation in one diminutive paragraph. They will then create a sentiment about the organization, a conviction that they will believe for the remainder of their years.

Assuredly, a simple and strongly worded mission statement helps to excite and hold the letter-perfect ability in the business world. Most definitely, capital is vital, but there are many different types of skilled workers who would like to develop a craft in an improving, niche corporation, and possessing a mission statement can help them to convey that representation. The benefits of having a mission statement are far too vital to be overlooked, and it is so very much suggested that every business be obliged to create a mission statement so that just about one and all, employees, shareholders, vendors, third parties, and so on are informed of its mission.

Disadvantages of Having a Poor Mission Statement

It will bring some disadvantage to a company if the company has a poor mission statement. Some mission statements are unrealistic. The mission statements that are unrealistic such as over promise will not give a clear indication of what the business is about. There is also no credibility if the mission statement is not realistic. For instance, in October 2002 Microsoft changed its mission statement from “To empower people through great software — in any time, any place, and on any device” to “To enable people and businesses throughout the world to realize their full potential”. Is the new mission statement realistic? Does it give any indication what Microsoft is about? The answer is no. This can cause the mission statement to be beyond the ability of the company to achieve.

Some mission statements are unclear. A clear mission statement is very important to give others a clear vision about the company. People will understand more about the company and feel confident towards it with a clear mission statement. A clear mission statement provides a means of evaluating and screening the marketing plan. Employees need clear mission statement also to understand what the company want and do well in their job. For instance, General Electric’s “Boundaryless … Speed …Stretch” or Ball Corp.’s pledge to maintain high levels of social responsibility sound good, but leave the reader asking “What does it means?” This means that the mission statement is unclear. An unclear mission statement will make employees feel confuse about their job and they not sure about what they have to do as an employee. It will also disturb the evaluating and screening of the marketing plan by company to make the marketing decisions consistent with the mission.

Furthermore, a long and complicated mission statement will also bring disadvantage to business. Long and complicated mission statement will make employees hard to remember and understand the meaning of the mission statement. Employees will feel confuse about the mission statement and easily forget it. This can lead to misunderstand the meaning of the mission statement and misleading marketing planning. This is because of mission statement provides an outline of how the marketing plan should seek to fulfill the mission. Therefore, without a short and easily understood mission statement, marketing planning cannot perform well.

Some mission statements are narrow. A narrow mission statement is not suitable for the business which wishes to expand business to global market. A mission statement should not limit a company’s area of service or expertise too narrowly because of the customer needs, and customers can change rapidly especially in the fast-paced world of electronic commerce. A narrowly mission statement cannot match with the changing variable and make the business become not competitive to compete in the global market. So that, a mission statement should be broad enough to allow the company to meet those needs without annual revisions of the statement.

Leave a Reply

Your email address will not be published. Required fields are marked *