Mission Statement Strategy

Jack TroutNovember 19, 20074 min

A good marketing strategy is like a mission statement, and one could assume that once a company understands its basic differentiating strategy, it would be a simple matter to sit down and fold it into such a statement.

Don’t make that assumption.

Since Volvo is all about safety, its mission statement would read something like: “Volvo is in business to make the safest vehicles in the world.”

Do you think Volvo has anything like that hanging on its walls? Nope. It has a mission statement of 130 words and “safety” shows up as the 126th word. (It barely made it into the statement.)

It’s no wonder that Volvo is drifting into hot, sporty convertibles like its C70. On these cars, gone is that safe, “tanky” look. If it keeps this up, gone will be its business as well.

It’s current thinking that a mission statement helps define what a company wants to be when it grows up. Companies spend weeks and months agonizing over every word.

If you explore this thinking, you’ll see there is a widely accepted process for creating these statements. The following chart presents the phases of effort along with our remarks about the problems that we see with each phase.

How mission statements are born.

Phase 1: Envision the future.

(It can’t be done.)

Phase 2: Form a mission task force.

(Waste the time of expensive people.)

Phase 3: Develop a draft statement.

(Many hands make things mushy.)

Phase 4: Communicate the final statement.

(Hang it on the wall for people to ignore.)

Phase 5: Operationalize the statement.

(Turn the company into mush.)

As far as I’m concerned, this process adds needless complication to most companies and very little benefit.

Nothing proves this point more than glancing through a book which contains corporate mission statements from America’s top companies. In an article in Marketing Magazine, a gentleman named Jeremy Bullmore sat down and counted the words most frequently used by mission statement writers. It was an exercise in counting the clichés. Here’s his tally from the 301 statements he found:

service (230 times) growth (118)

customers (211) environment (117)

quality (194) profit (114)

value (183) leader (104)

employees (157) best (102)

He also discovered that many of these 301 statements are interchangeable. (Could it be that companies are knocking off other companies’ mission statements?)

Boeing wrote about “a fundamental goal of achieving 20% average annual return on stockholders’ equity.” (That’s scarcely realistic when you consider the success of Airbus. Boeing should be talking about the business, not the numbers.)

Even the government is into Mission Statements. The U.S. Air Force had one of the best of the bunch. “To defend the United States through control and exploitation of air and space.” (Kicking ass in the air is indeed what it’s about.)

The CIA had almost 200 words of motherhood and mush in its statement, and not one mention about its basic problem of getting it right.

As best we can see, most of these mission statements have little positive impact on a company’s business. Levitz Furniture has a mission of “satisfying the needs and expectations of our customers with quality products and services.” (That wonderful mission didn’t keep it out of bankruptcy.)

Fortunately, most companies put their mission statements in gold frames and hang them in their lobbies where top managers who have their own agendas ignore them.

A simple approach is to forget about “what you want to be.” Management should focus its efforts on “what you can be.” It’s far more productive.

This means that you have to put your basic business strategy into the statement. It should present your differentiating idea and explain how by preempting this idea you will be in a position to outflank your competition. Volvo’s mission statement should be about safety. That’s what it can continue to represent in the market.

Boeing’s mission statement should be about maintaining leadership in the commercial aircraft industry, not about return on equity.

And you don’t need a committee to spend weeks writing this statement. This should be something that the CEO and his or her top people should be able to put together in a morning’s work. Keep it short and simple.

The Seagram Company mission statement spills over to ten sentences and 198 words. (You need a tumbler of good Scotch to get through it.)

After all, if a CEO needs a committee to figure out what the basic business is about, then that company needs a new CEO, not a mission statement.

The last step is not to just hang the “what we can do” statement on the wall. Take this basic business strategy to all the important groups in a company and make sure they understand it. Let them ask questions. Be candid with your answers.

And to me, that’s the only purpose of a mission statement: to make sure everyone in the company gets it.

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Jack Trout

5 comments

  • Stacey Clark

    November 19, 2007 at 9:46 am

    Successful entrepreneurs always start with an insight into an unfulfilled customer need. Often it is based on personal experience…something they want but can’t get. Their mission statment strategy is simple – they talk about a customer benefit and organise the business to deliver it.

    This customer benefit is the misson. e.g. Innocent drinks is build around being pure, fresh and unadulterated. Everyone in the organisation knows the mission, everyone can look at an initiative and know if it is likely to fit.

    Large organisations tend to lose this clarity of focus. Probably the difference between an entrepreneurs clarity of purpose and a committee!

  • Ted Grigg

    November 19, 2007 at 6:54 pm

    Thanks for the nice laugh.

    There’s nothing like reading a corporate mission statement. They mostly say and sound the same.

    What a waste of time and energy. Yet another meeting where nothing gets done.

    And yes. The employees “get it” as you say alright. What they get is that the they are working for a boring and rudderless company.

  • Steve Rogers

    November 22, 2007 at 12:34 pm

    I laughed a lot reading this. Reminds me of a time when I bought a new car from possibly the largest car manufacturer in the world. upon delivery (trading about $7 at the moment I think) at their Darwin based dealership the car door was scratched. Simple problem to fix you would think?? well anyway 6 weeks later and frustrated as hell I was talking to the dealer principle. I pointed out the mission statement on the wall behind his desk.. the usual stuff see above.

    He sat back and said ‘ oh that’s just some shit head office sends out to hang on the wall’ classic.

  • Una Herlihy

    June 5, 2011 at 4:13 pm

    The second I hear a company mission statement talking about delivering shareholder value I roll my eyes. I want to know what you are in business to achieve beyond delivering shareholder value. Easier said than done. Thanks.

  • Paul M

    August 7, 2011 at 10:37 pm

    You’ve identified only part of the problem. I agree that Volvo’s mission statement should be about safety, Boeing’s about maintaining leadership in the aircraft industry and the general sentiment that Mission Statements are basically ignored. I think this is because a) they’re focused on objectives that are relevant to the average employee and b) management doesn’t take them seriously themselves.

    If top management takes it seriously, employees will too. If they don’t believe in the mission, it just won’t work. Similarly, if the mission is something that is credible and within the ability of the average employee to achieve, then success is far more achievable.

    Many years ago, I was CEO of a software company that developed our own Vision Framework which included Core Values and a Core Purpose. I required all my VPs to memorize these and in turn all their staff to memorize them as well by a deadline date.

    After the deadline, I walked around and systematically asked random employees from each division if they knew our Core Values and our Core Purpose. Those that did got a $100 bonus on the spot; those that didn’t were kindly asked to make sure they took it seriously. However, for this latter group, their managers were all docked their quarterly bonuses immediately.

    That pivotal moment was transformational in our company’s history. First, we never had that problem again and secondly, by embodying the tenets of our Vision Framework in every meeting, announcement, communique, client meeting etc., our company took off like a rocket.

    We successfully exited within 3 years (2 years earlier than planned while exceeding targets) and were able to pay off some of those very same managers (that were docked bonuses) exit packages which dwarfed their lost bonuses by orders of magnitude.

    PM

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