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Strategic Intent Mission and Vision

Concept of Strategic Intent Vision and mission Formulation of Vision and Mission statements Different perspectives on Vision and Mission Business definition and Concept of a Strategic Model

Strategic Intent In this part we will understand the concept of Strategic Intent and the various levels of intentions, i.e., long-term to short term intentions like vision, mission, goals, objectives, plans Concept of Strategic Intent Effective Strategic management begins with the organization clearly articulating its vision for the future. The concept of Strategic intent, popularized by Gary Hamel and C.K. Prahlad (1989), refers to the purpose of the organization and the ends it wishes to pursue. Strategic Intent The Strategic Intent of the firm represents the organizations belief about its state of the future. The purpose or ends the organization wishes to pursue vary from being really broad and long-term (mission and vision), to being narrow, with a focus on the short or near-term (objectives or goals). It is important to realize that achieving the narrow intentions is a necessary condition towards achieving the broader intentions, and therefore, there needs to be a careful alignment between these various levels of intentions. Characteristics of Strategic Intent Indicates firms intent to making gains in competing against key rivals and to establishing itself as a winner in the marketplace. Involves establishing a grandiose performance target out of proportion to immediate capabilities and market position but then devoting a firms full resources and energies to achieving the target over time. Signals relentless commitment to achieving a particular market position and competitive standing Strategic Intents Vision Vision represents the imagination of future events & prepares the organization for the same. It represents the challenging portrait of what the organization would be in future. Features of a Visionary Company: A visionary company holds a distinctive set of values from which it does not deviate. The company expresses its core purpose in enlightened purpose which provides challenges for actions Test Your Knowledge A company pursues strategic intent when A. It pursues its strategic vision. B. It crafts a strategy and proceeds to implement it. C. It adopts a strategic plan and tries to execute it. D. It sets objectives and pursues their achievement. E. It relentlessly pursues an ambitious strategic objective and concentrates its full resources and competitive actions on achieving that objective.

Business Vision Statement A statement that clearly defines the firms reason for being in business Should significantly stretch the resources and capabilities of the farm Should inspire people in the organization to achieve things they never thought possible Should unite people in the organization toward the pursuit of one common goal Developing a Strategic Vision Involves thinking strategically about Future direction of company Changes in companys product/market/customer technology to improve Current market position Future prospects Key Elements of a Strategic Vision Delineates managements aspirations for the business Provides a panoramic view of where we are going Charts a strategic path Is distinctive and specific to a particular organization Avoids use of generic language that is dull and boring and that could apply to most any company Captures the emotions of employees and steers them in a common direction

Is challenging and a bit beyond a companys immediate reach Components of a vision Collins & Porras (1996) A well-concieved vision consists of 2 major components: Core ideology & Envisioned future 1. Core ideology defines the enduring character of an organization that remains unchangeable as it passes through different phases such as technology, competition or management fads. Core values: Essential & enduring tenets of organization. Eg: Excellent Customer service, pioneering technology, creativity, integrity, social responsibility. Core Purpose: Organizations reason for being which remain unchanged. 2. Envisioned Future: -10-30 yrs. audacious goal -Vivid description of what it will be like to achieve that goal Role of a Strategic Vision A well-conceived and well-communicated vision functions as a valuable managerial tool to Give the organization a sense of direction, mold organizational identity, and create a committed enterprise Inform company personnel and other stakeholders what management wants its business to look like and where we are going Spur company personnel to action Provide managers with a reference point to Make strategic decisions Translate the vision into hard-edged objectives and strategies Prepare the company for the future Communicating the Strategic Vision Winning support for the vision involves Putting where we are going and why in writing Distributing the statement organization-wide

Having executives explain vision to the workforce An engaging, inspirational vision Challenges and motivates workforce Articulates a compelling case for where company is headed Evokes positive support and excitement Arouses a committed organizational effort to move in a common direction Examples of Strategic Vision Levi Strauss & Company We will clothe the world by marketing the most appealing and widely worn casual clothing in the world. Examples: Vision Slogans Scotland Yard To make London the safest major city in the world. Payoffs of a Clear Strategic Vision Crystallizes an organizations long-term direction Reduces risk of uncontrolled decision-making Creates a committed enterprise where organizational members enthusiastically pursue efforts to make the vision a reality Provides a beacon to keep strategy-related actions of all managers on common path Helps an organization prepare for the future Overcoming Resistance to a New Strategic Vision Mobilizing support for a new vision entails Reiterating basis for the new direction Addressing employee concerns head-on Calming fears Lifting spirits Providing updates and progress reports as events unfold Mission The mission statement makes the vision statement more tangible and comprehensible. In most cases, the vision statement is just a SLOGAN, a war cry, or even a short phrase containing superlatives. In order to make the strategic intent of the organization more clear and articulate, a mission statement is used. Mission What is our business? What it will be? What it should be? A mission statement clearly specifies

Why an organization exists, or the purpose;

What differentiates the organization from others, or the identity

The basic beliefs, values and philosophy of the organization

It tells what the company is providing to society.

Strategic Vision vs. Mission A strategic vision concerns a firms future business path - where we are going Markets to be pursued Future product/market/ customer/technology focus Kind of company management is trying to create The mission statement of a firm focuses on its present business purpose - who we are and what we do Current product and service offerings Customer needs being served Technological and business capabilities Characteristics of a Mission Statement Identifies the boundaries of the current business and highlights Present products and services Types of customers served Geographic coverage Conveys Who we are, What we do, and Why we are here Key Elements of a Mission Statement Three factors need to be identified for completeness Customer needs being met What is being satisfied Customer groups or markets being served

Who is being satisfied What the organization does (in terms of business approaches, technologies used, and activities performed) to satisfy the target needs of the target customer groups How customer needs are satisfied Test Your Knowledge The difference between a company's mission statement and the concept of a strategic vision is that A. the mission statement lays out the desire to make a profit, whereas the strategic vision addresses what strategy the company will employ in trying to make a profit. B. a mission statement deals with where we are headed whereas a strategic vision provides the critical answer to how will we get there? C. a mission deals with what a company is trying to do and a vision concerns what a company ought to do. D. a mission statement typically concerns an enterprises present business scope and purpose who we are, what we do, and why we are herewhereas the focus of a strategic vision is on the direction the company is headed and what its future product-customer-market-technology focus will be. E. a mission is about what to accomplish for shareholders whereas a strategic vision concerns what to accomplish for customers. Conventions on Mission & Vision Quick Look-up on Shortcomings in Company Vision Statements

Vague or incomplete Not Forward-looking Too broad Bland or uninspiring Not distinctive Too reliant on superlatives Exercise Using the above information critique the following strategic visions and rank them from 1 to 7 (in need of substantial improvement) Red Hat, To extend our position as the most trusted Linux and open source provider to the enterprise. We intend to grow the market for Linux through a complete range of enterprise Red Hat Linux software, a powerful internet management platform, and associated transport and services. Wells Fargo, We want to satisfy all our customers financial needs, help them succeed financially, be the premier provider of financial services in every one of our markets, and be known as Americas great companies. Caterpillar, Be the global leader in customer value Hilton Hotels Corporation, Our vision is to be the first choice of the worlds travelers. Hilton intends to build on the rich heritage and strength of our brands by: Consistently delighting our customers Investing in our team members Delivering innovative products and services Continuously improving performance Increasing shareholder value Creating culture of pride Strengthening the loyalty of our constituents The Dental Products Division of 3M Corporation, Become THE supplier of choice to the global dental professional markets, providing world class quality and innovative products. (Note: All employees of the division wear badges bearing these words, and whenever a new product or business procedure is being considered, management asks, Is this representative of THE leading dental company? Ebay, Provide a global trading platform, where practically anyone can trade anything. H.J Heinz Company, Be the worlds premier food company, offering nutritious, superior tasting foods to people everywhere. Being the premier food company does not mean being the biggest but it does mean being the best in customer value, customer service, employee talent, and consistent and predictable growth. How to formulate mission statement? Include your organizations strengths, values, and purpose. Explain why your organization exists. What do you provide? What are you trying to accomplish? Include core values. Include any unique competitive advantages. State the organizations overall strategy for determining long-term success. Google's mission is to organize the world's information and make it universally accessible and useful. The Coca-Cola Promise: The Coca-Cola Company exists to benefit and refresh everyone it touches. The basic proposition of our business is simple, solid, and timeless. When we bring refreshment, value, joy and fun to our stakeholders, then we successfully nurture and protect our brands, particularly Coca-Cola. That is the key to fulfilling our ultimate obligation to provide consistently attractive returns to the owners of our business." Lets Discuss Federal Express FedEx will produce superior financial returns for shareowners by providing high value-added supply chain, transportation, business and related information services through focused operating companies.

Customer requirements will be met in the highest quality manner appropriate to each market segment served. FedEx will strive to develop mutually rewarding relationships with its employees, partners and suppliers. Safety will be the first consideration in all operations. Corporate activities will be conducted to the highest ethical and professional standards. Boeing "To push the leading edge of aviation, taking huge challenges doing what others cannot do" Lets Discuss 3M 3M's commitment is to actively contribute to sustainable development through environmental protection, social responsibility and economic progress. To us, that means meeting the needs of society today, while respecting the ability of future generations to meet their needs. Unilever Unilever's mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene and personal care with brands that help people feel good, look good and get more out of life. McDonalds - To satisfy the worlds appetite for good food, well-served, at a price people can afford. Goals As mission statements make vision statements more tangible. Similarly, goals provide the basis for action towards the achievement of the organizations mission, in the form of specific milestones. Goals are both financials and nonfinancials, and specify the route the organization takes to achieve its vision and mission. Objectives Objectives are operational definitions of the organizational goals. They provide the measurable parameters for monitoring/evaluating the performance of the organization. Objectives also include a time dimension that delineates the specific goals the organization intends to achieve in defined periods. By providing a series of time-bound objectives, the organization demonstrates how it can move towards achievement of its goals, through consistently and periodically achieving obejctives. Plans Plans indicate the specific actions that will be taken by the organization in order to achieve the objectives. Plans specify the roles members of the organization will perform, the resource allocation across different organizational sub-units and departments, and prioritize and schedule the various activities. Business definition Defining the Business A business can be defined in terms of three dimensions (according to Derek Abell): Customer groups Customer needs Technology e.g. Designing incandescent lighting system for studios. Business definition of a small lighting company What is a Business Model? A business model is the method of doing business, which spells out how a company will generate profits, and using what value configuration activities. Describes the rationale of how an organization creates, delivers, and captures value- economic, social, or other forms of value. The term business model is thus used for a broad range of informal and formal descriptions to represent core aspects of a business, including purpose, offerings, strategies, infrastructure, organizational structures, trading practices, and operational processes and policies. Examples Bricks and Clicks Model Direct Sales

Cutting out the Middlemen Franchising Low cost Carrier Razor & Blade (Bait and Hook) Subscription Business Online Auction A generic business model

Revising Mission and Business definition The Case of Nokia In 1992 Nokias strategic intent was expressed in four criteria Focused Global Telecommunications-oriented High value-added Its vision was the voice will go wireless The Nokia vision in 1992 led to the company divesting a broad range of businesses that contributed some 90 percent of its revenues and to focus on the manufacture of handsets and network equipment. The leaders set a further goal of doubling market share by the end of the decade. This achieved by 1997 and by 1999 Nokia had overtaken Motorola as market leader. The Case of Nokia In 1997 the strategic intent was articulated in terms of a mobile information society and bring the internet to everyones pocket The 1997 vision further consolidated Nokias market position and led to the development of the picture phone and the mobile internet etc.

The companys current mission is about the awesome potential in connecting people- whenever, wherever, we believe in communicating, sharing, and in the awesome potential of connecting the 2 billion who do, with the 4 billion who dont.

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