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Vision, mission, values: why are they important and how to define them?
The vision, mission and values summarize the company's main ideas and mission and are part of the business plan. Thanks to them, you and your employees will have an imaginary map of the company's journey and everyone will be clear about where you are heading. Such an overview will make planning easier and help you make decisions. Find out how to set your company vision, mission and values.
Company vision versus mission: how do they differ and how to define them?
When worded incorrectly, a company's vision and mission may seem to express the same idea. In reality, mission and vision are related and together provide a comprehensive description of the company.
- A vision statement indicates where your company is headed.
- A mission statement tells you how you want to achieve it.
Ideally, the vision and mission statements should be unique to differentiate you from your competitors and ensure your recognition in the marketplace.
The difference between a vision and a mission
Vision
- Focuses on the future.
- It defines what your company will look like in the long term and what you want to achieve.
Examples:
- Google: "Provide access to information from around the world at the click of a button."
- LEGO: "A global powerhouse for learning through play."
- IKEA: "Creating a better everyday life for many people."
- Bosch: "We want to deliver superior quality and reliability. In short: we want to create technology that is 'Built for Life'."
Mission
- Describes the present.
- Summarizes your company's mission.
- Answers the question of why, what and for whom you do what you do.
Examples:
- Google: "Our mission is to organize the world's information and make it universally accessible and useful."
- LEGO: "To inspire and develop the builders of tomorrow."
- Netflix: "To entertain the world."
- Disney: "To entertain, inform and inspire people around the world through the power of unique storytelling that reflects iconic brands, creative thinking and innovative technology."
How to express the company's vision?
A company's vision represents what you want to achieve with your business. We all want to make the world a better place, but that doesn't tell customers and employees much about you.
Therefore, be as specific as possible when formulating your company vision. Focus on what makes your company special, what makes you different from your competitors and what you stand for. The easiest way to define your company vision is by using the 5×Why method.
How to define your vision using the 5 times why method:
Remember when you were a little kid and you weren't satisfied with a simple answer and kept asking, "Why?" That's exactly how the 5 times why method works.
Think about how you envision the future of your company and what you want to achieve. For each point, ask yourself follow-up questions and ask why that is. After five "whys" or so, you'll get a clearer picture of your vision. Then reduce the answers into a meaningful sentence and you're done!
How to formulate a company mission statement?
A mission statement can be simplistically understood as the purpose, meaning or mission of a company. It is not just a summary of what your company does, but defines the means by which you fulfill your vision. Be concise, precise and positive even if your business is dealing with challenging and difficult topics. Show that you believe in a better future.
You can best express your mission by answering the following questions:
- Why do you do what you do? What is the purpose of your company?
- Who are you doing it for and how? How does your business affect and help your customers?
- What problems are you solving or trying to prevent? What outcome can customers expect?
Corporate values as an indicator of direction
Values are what your company believes in and what is important to it. They are the principles, ideas and rules that guide the behaviour and actions of the company and all employees. While vision and mission statements tell you where you want to go and how you want to get there, values show direction and keep you on track to achieve them.
By accurately defining your values, you simplify decision-making and the day-to-day work of your subordinates while ensuring that they are aligned with the company's vision and mission.
Think about how you perceive your company and how you want others to perceive it. What do you value and base your approach to employees, clients, the environment and other areas? Where are your boundaries that "the train doesn't go"? Again, be as specific as you can. For example, if one of your values is courage, don't just stop at the word itself, but explain what it means to you and your clients. Take inspiration from the values of the Swedish company IKEA.
How to fulfil the company's vision? Set goals!
It's not for nothing that they say a goal without a plan is just a dream. In order to achieve your vision, be clear about your path and set sub-goals. A well-defined goal will open the way to realization.
Be specific, realistic and bold. Goals should be challenging, but also take into account your current situation, abilities and opportunities.
For clear and precise goal setting, we recommend using the SMART method. It consists of 5 principles that say that every goal should be:
- Specific (What does your goal look like? What do you want to achieve?)
- Measurable (How will you know you are on track to meet your goal? How will you measure progress and results?)
- Acceptable (Is the goal aligned with the company's purpose, strategy, and culture?)
- Realistic (Do you have enough resources - resources, staff, time, information? Is achieving the goal realistic for you?)
- Time-bound (In what timeframe do you want to achieve your goal?)
Example of a well-defined goal: Increase e-commerce sales by 50% by the end of 2024.
Example of an ill-defined goal: To become the largest e-shop in the market.
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