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Whatisthegoalofcompany’sactivity? The question is by no means rhetorical and the answer is not always simple. However, the correct approach to the problem solution could help the entity in uniting the team and even standing out against a background of the whole market.
In his book “Seven Habits of Highly Successful People," Steven Covya world-wide company management expert-advisordescribes a fictitious situation when a small group of people tries to get through the impassable jungles. Armed with sharp machete they track behind and believe to succeed in this work. They covered a huge distance and the speed is increasing every day.
However there is a man (group member) who after climbing the tallest tree and looking around understands that this is a wrong jungle. In other words the people tracked to nowhere. They did not get lost, because they had no goal. In exactly the same way many companies become so enthusiastic in resolving the day-to-day tasks that simply forget about the sense of their activity. The company boss’ role is nothing but to show his/her employees the general direction. Although to maintain the correct direction, the leader must clearly represent the company’s global goal or its mission.
Great difference
The goal is more specific than mission. It is something that is reached within a definite and relatively short period of time. Eric Allenbow one of the most competent experts on perfecting company business calls the mission a goal behind a goal in his book “Five strategies of great companies”. The book is supposed to answer the question what should be after the set problem is resolved.
For example, it is obvious that any realtor company has the goal to raise profit through selling houses and apartments. However there is more general goal worded by one firm thanks to Eric Allenbow. It is to help the families to find the house of their dream and move there.
Robert Schauss, Spektor, Sachs & Company consulting and investment-banking partner believes that the company’s mission is to answer the question “Why are we working in this market segment?” The comprehensive task of the company could not declare the increase rate, market share and other relevant indices.
Eric Allenbow represents the company mission as extension or embodiment of the creator’s dream. The history of Walt Disney and Disney World could serve as a striking example of how the dream of life could be realized through the business. Thanks to his inner energy the man could inspire his employees with an idea in such a strong way that it has been alive till now. Given the logic, the financial profit from work of any firm could be considered, strange as it may seem, only as a by-product of activity.
Source of inspiration
However no enterprise could operate without its mission, even though it has not been clearly written on paper, but is implied by the leader. Nevertheless, there is a difference between the issue whether every employee clearly understands what the company is operating for and situation when only the top-management has an idea about the clear trend.
Tatyana Aster, the founder of the RAMADA Russian personal training program, believes that the lack of mission threatens the company with fact that the management loses additional incentive tool for employees and company presentation in the business socium. “Mission is the foundation of any organization that determines its development value priorities and guiding lines”, says Mrs. Aster.
Eric Allenbow states that the key idea when it leaves the framework of trite money-making could arouse an enormous creative power of the staff. “As people become aware that they work for the sake of reaching the significant goal, their involvement, productivity and desire to achieve more breaks all barriers. It may seem strange, but the companies the follow the mentioned above philosophy obtain better financial results” believes the author of “Five strategies of great companies”.
Michael Berlin, the CJSC “Ukrainian Insurance House” Chairman of the Board notes: “It is important to fulfill the mission statements and help the company in obtaining its vivid peculiarity on the market”. Otherwise it has no sense.
In addition, the expert believes that the key idea should be a real strategic component of the entity activity but not a modern business fashion tendency. On the other side many representatives of Ukrainian companies think that the main stakes of the local business are place on direct realization of assignments by the staff-members but not on comprehensive wording.
Victor Rasputny, Real Estate Solutions CEO, states: “The most important thing to be taken into consideration while developing the mission is the possibility of its implementation”. Otherwise, it will become a list of beautiful mottos. “It may lead to the negative consequences, or even disaster should the business is expected to be public-oriented”, assures Mr. Rasputny
Divide and act
The oversees experts note, that sometimes it is insufficient to indicate the supreme goal of the company to the stuff-member, one should help him to understand its importance for him/her. Robert Schauss remembers how he assisted the transnational company in mission development. The supreme goal was worded in one-third of the page with his help. But only after a special training for each of 18 thousand workers anybody was able to explain how his job helps to implement the company main goal.
Steve Covy thinks that in order to organize the work in successful way, every decision should have a special mission created on the grounds of the general goal. In book Seven Habits of Highly Successful People" he gives examples of the companies that operate with Swiss watches precision. Every employee always knows what he should do in this or that situation, because he understands the global assignments.
Zest for client
One of the key functions undertaken by the company’s mission is to provide the clients with ideas why their services or goods should be prioritized. Besides the fact that it is one of the fundamental and strategic vectors inherent in every civilized company, it is also a sort of a business card, considers Alexander Stupko, “Sarmat” human resources director.
End user should always remain the key person of the business. “Mission helps both to resolve many internal problems of the company, and position it on the market’, states Tatyana Aster. At the same time wording “We also sell this kind of goods”, according to the Robert Schauss opinion is exaggerated. “This type of mission is effective until the market is in the development process and the goods are in demand. But when the competition becomes stronger, one should give clear definition of the word “better”. To resolve the problem one can make more functional or attractive packaging or expand the range of goods. We should not forget about another important function undertaken by the mission – public relation.
“It allows us to designate the company’s strength, e.g. competitive preference and vision of the strategic goals” states Victor Rasputny. However there is a complication, because not all businesses are accepted equally by the society from the moral standards views. Therefore, during the mission announcement one has to withhold some ideas. The tobacco companies and their acceptance in society could serve as the most striking example.
Non-platitude in the nutshell
What must the local entrepreneurs know, if they want to formulate their own mission? First and foremost, it should not be too big. Robert Schauss suggests not more than 10 sentences.
On the other hand, one of the typical mistakes is to affirm something that is self explanatory. “Mission should not be the platitude list. For example, the statement that the company plans the x-per cent of the market growth surpass does not mean anything. In other words, if the company declares the key idea that could be applied in equal measure to its competitors, it’s all the same as if the company has no mission at all”, Robert Schauss says.
Common cause
The key idea should take into consideration the interests of all staff-members, however it is formulated by several people. “Because, if we get everybody to take part in its wording, it will end up in the mess”, considers Robert Schauss. However Steve Covy believes that all employees must participate in the process. Since the individual opinion in mission formulating is of no less importance than the final result of the work because it serves as a key to the successful embodiment of the global assignments. “People simply do not accept the global decision passed in their absence” Steven Covy writes. For example, the top-management of the Sarmat group was involved into the mission formation process. “However, the views and opinions of all company workers were taken into consideration” notes Alexander Stupko.
Nothing is everlasting
Although the company mission is its supreme goal, it does not mean that being once approved it remains invariable. Volatile environment demands the re-assessment of the company’s priorities. Obviously, a lot depends on the individual market and the stage of its development. The history of the La Sportiva company could serve as a good example. It is one of the leading manufacturers of the specialized footwear for mountain-running and rock-climbing. It was founded in 1020s when Narciso Delladio launched the production of sturdy and reliable boots for lumber-jacks and farmers. But when the Second World War began the company refocused its specialization and started to produce mountain boots for Army.
After the war the second generation of the company owners got access to the new but rapidly developing market of mountain-ski boots. In 1970 when the mountain skis conquered the hearts of many people the leather boots were replace by the plastic ones. To remain at the market the company needed large investments into new technologies. Therefore La Sportive decided to refocus onto the needs of mountain tourists and mountain climbers, since the popularity of this type of vacation was growing steadily. A bit later the company launched the production of rock climbing footwear.
Obviously the revision of the company key goal provides the opportunity to make sure that the company keeps the right track. The mission life-span could be several years and even more than a decade. Robert Schauss believes that in Ukraine a company with aggressive strategy and respectively aggressive mission should revise it approximately once within a three-year period.
On the other hand Alexander Stupko thinks that frequently changed mission and strategy of the company indicate insufficiency of the company management organization
Äåëîâîé æóðíàë, No 5 (33), May 2006
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