Every working day for nearly 17 years, I walked by the same mission statement poster. I can’t remember what it said, which tells you all you need to know.
Most vision and mission statements are like that.
Well-intentioned, sure. But often a waste of time, especially since the goal sometimes seems to be to cram in as many positive virtues as possible: Innovation. Disruption. Commitment. Solutions. Value.
The average mission statement, much less vision statement, is white noise.
Yet the underlying premise makes sense. As a leader, one of your most important responsibilities is to create and steward strategy: Deciding where you want to go, and how you will get there.
If you create vision and mission statements that establish a clear starting point for your objectives, goals, strategies, and tactics–then they will provide real value.
The best approach I’ve seen comes from Around the Corner to Around the World, the new book by ex-Dunkin’ Donuts CEO (and son of the company founder) Robert Rosenberg. Early in his tenure, considerable losses resulted in the company’s board telling Rosenberg to search for his own replacement. (Getting fired is one thing, but having to find the person to take your place? Eek.)
Rosenberg asked for one more quarter to evaluate whether solutions already put in place would pay off.
Here’s how Rosenberg defined terms like vision, mission, objectives, goals, strategy, and tactics–and how each term linked together to form a clear plan that turned the company around.
“A vision is a statement about what the leadership agrees a company could reasonably stretch to be in a generation–a 30-year aspiration.”
According to Rosenberg, if the statement doesn’t contain “to be,” it’s not a vision statement. For example: “We wish to be the largest bicycle manufacturer in the United States as measured by sales within 30 years.”
Your vision is where you want to be–a long, long way down the road.
“A mission is what you wish the company to be over the next three-to-five years.” Again, it should contain “to be.” Your mission sets a shorter-term agenda for steps that will allow you to someday achieve your vision.
According to Rosenberg, this might be the most critical step in the planning process. Not only do you determine what you want the company to be, but also what it will not be.
As Rosenberg writes, “The most important job of a CEO is to define reality … to be absolutely realistic about [the company’s] capabilities and the competition it faces.” And to focus on things you can reasonably achieve that fit your vision.
If your mission is to build your bicycle company through online sales à la Canyon, a mission that includes running the dominant bicycle shop in every market in which you operate doesn’t fit. You’re an online retailer, not brick-and-mortar.
“Objectives (interchangeable with ‘goals’) are what you want to have.”
The key is to sift through all the possible metrics and KPIs to determine the goals that most define success. Dunkin’s mission was to be “the dominant doughnut and coffee provider in each and every market” in which it competed. Its early objectives?
- To have earnings per share grow at 15-to-20 percent per year.
- To have store-level economics achieve at least a 15-percent return on investment on average.
- To have debt never total more than three times EBITDA.
The company measured plenty of other things, obviously. But those objectives mattered most. This meant other goals had to support those objectives, otherwise they weren’t important.
Rosenberg writes that strategic initiatives are, “the four-to-six most important tasks an organization must execute in order to bridge ever-scarce resources to achieve stated objectives.”
Dunkin’ decided the best way to achieve 15 percent earnings-per-share growth was to add new stores by 3 percent each year. At one time, that meant the company had to open 100 new stores the following year. This meant the real estate division needed to list four-to-six initiatives that would achieve that objective.
Objectives are what you want to have. Strategic initiatives are how, in broad terms, you will get there.
“The four-to-six action steps needed to support the achievement of each department’s strategic initiatives.”
Tactics are granular. Tactics lay out the steps defined by initiatives.
Say I worked in the Dunkin’ real estate department and was tasked with opening 10 of those 100 stores. Executing the strategy might have meant working with the three top franchises in my territory to add one store each to their holdings, engaging two new brokers to help identify potential locations, and arranging the purchase and renovation of four empty properties in suitable locations.
Tactics are the nitty-gritty; think of tactics as key headings on a to-do list.
The key is to make sure your tactics, initiatives, and objectives roll up to support your mission and, ultimately, your vision.
If they don’t, they don’t fit. Or you haven’t established a clear vision and mission for your company. Because your goals must always inform your process.