Why Vision Statements

Vision statements help create meaning for an organizations stakeholders.  Employees and others can use it to make connections between their actions and the values and purpose of the organization.  Vision statements can act as guides for employee actions and decisions.  The vision statement helps delineate not only what actions should be taken but also what actions shouldn’t be taken.  Organizations, as it is with individuals, are defined as much by what they don’t do and by what they do.

Compelling visions can inspire.  They foster commitment, meaning and a sense of belonging:  And when added to practices that encourage positive interactions that can motivate high levels of performance.

My first experience with a compelling vision was in high school.  As of member of the football team it was part of collective image that we were winners, champions in fact.  There was little doubt that we would be successful.   And our practices, both actual practices and traditions, reflected those beliefs.

We trained like champions, putting in many hours of voluntary efforts to demonstrate our commitment.  We practiced like champions by rejecting short cuts and mistakes on the field.  Much of reinforcement of these practices and vision came from peers not just the coaches.  We had all bought into the vision, and that translated to on field success.

With a well articulated and inspiring vision any organization can become the over achievers we did.

New Hub for Business Plan Competitions

Entrepreneurs are the engine of the economy, and business plan competitions often serve as the spark that gets them going. Because these competitions are an increasingly common part of entrepreneurship education efforts, the Kauffman Foundation has launched iStart , a Web-based platform that helps organizations simplify how they market and administer business plan competitions worldwide. iStart also is designed to connect entrepreneurs to a network of support, including mentors and others who can assist them in the growth of their businesses.

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Visioning Exercise

I’ve previously explained how a vision statement supports a strategic planning exercising but didn’t provide much guidance about how to construct a vision statement.  Here is an exercise you can use to begin the process of creating an exciting and motivating vision for your organization.

Imagine it is now four years from today.

Four years ago, we were viewed in the press as an organization stagnating in flat growth.  Now, business sections of newspapers across the US and abroad are writing about our amazing turnaround.

In fact, the Corp for Public Broadcasting has called and asked to interview someone on the Nightly Business Report.

You have been asked to help organize the key messages that should be included in the interview.  You will be providing input directly to the program’s producer and want to make sure the program provides a balanced perspective on the changes your organization has experienced.

How does the organization now differ from what it was four years ago?

What positive changes have occurred?

How were they achieved?

Did technological developments contribute to these changes?

What other opportunities, in any, did you take advantage of?

After staying in this mental image of the future, take 15 minutes to jot down ideas and develop a response for each question.

From your notes you can construct vision statement that will motivate and guide your organization to create the future you envisioned.

What is a vision statement?

A significant component to most strategic plans is a vision statement.  A vision statement is a description of where the organization is heading.  It is a mental picture of what the organization should look like in the future and how the organization will look, feel, and interact with its stakeholders.  The vision statement should represent a valuable set of ideas that allows stakeholders to negotiate individual ideas into a shared vision.

In crafting a vision statement you will need to change your frame of reference.  You need to shift your thinking from the issues of today to what the organization will look like in the future.  Instead of trying to think of what the future will be like and looking forward, place yourself, mentally, into the future and look backwards.  Try to identify, what has happened to create this future you are envisioning.  The focus should be shifted from current circumstances to future successes.   As many self help proponents suggest giving yourself affirmations that allow you tell yourself how you want to be but in the present tense, the vision statement presents the future of the organization as if it has already happened.  In short, a vision is a picture of the future you want to create for your organization.

Meaning of Business or Business of Meaning

I recently read a quote by Sandra Waddock about the purpose of business.

“Successful companies achieve value added–or profitability for shareholders–by a sustained efforts to develop excellent products and services that meet the needs and interests of their customers.  Such companies achieve a vision underpinned by values that result in value added.”

I hear so many small business owners and potential entrepreneurs talk about how their business serves them.  It affords them the money to have the luxuries they desire.  It affords them the flexibility to manage their time  they way they desire.  Their business gives them an outlet to express their true selves.  Those are the value addeds.  What about the other side of the statement.  It is rare when I hear business people speak about the excellent products they are delivering to their customers.  Rarer still, they express how excited they are to delight their customers and the pleasure the customer might get from their products.  Its much more likely that I hear “This would be a great business if it wasn’t for the customers.”

At the heart of every successful business is vision of how delighted they can make their customers: the honor and pride the business takes in providing a its customers with a way to fulfill their wants and needs. 

I’m no different from other business people.  At times I lose sight of the meaning of business: providing customers with a way to meet their needs and interests.  So I commit to you, if you commit to me, that each day, together, we take a moment to remember why we’re in business:  to make happy customers that result in value add.

Bowling Alone

I recently read an article about Robert D. Putnam, a researcher that has theorized that social capital is declining in the United States due to individualizing of social interactions.  Specifically, the society is falling apart because of the television and internet.

A central piece of data that intrigued me was his finding that over the last 20 years the number of people that bowl has risen 10% while the the number of people that participate in bowling leagues has dropped 40%.  So people are bowling alone and not with anyone else.  This reduction in social interactions has reduced the opportunities for societal connections and debates.  This reduction has then in turn caused a reduction in the participation in the political process.

I wonder how the evolution of social media has impacted the trend Putnam theorizes.  By all accounts, social media has opened up new avenues for social discourse and interaction.  Any person with a computer can potentially become his own publisher and espouse his ideas freely.  Yet, this makes  me think that everyone is just pumping out their viewpoints and no one is really listening.  Is there just more isolation because it doesn’t take much effort to “feel” like you are being heard?  Is there an attitude developing where we all think we have contributed to the conversation because we posted something, but it isn’t a conversation unless someone responds?  So I’m left wondering, am I just bowling alone when I press publish.

Decisions, Decisions – Making Them On Purpose

Here’s repost from a favorite blog of mine.  For the more business minded substitute vision or mission for purpose while reading.

“Decisions, decisions…choices, choices.  Everywhere you turn these days there’s another one waiting to be made.  But how? In a world of so many options and possibilities, what do we use to help us make the “right” decisions and choices?

Do we draw straws?  Flip a coin? Throw a dart at a list of choices to be made? 

Sure, why not?  Won’t those methods work?  Well, actually, yes, any of these ‘random ways’ of choosing can work IF we add in a couple of other things.”

To read more go to: http://www.lifeonpurposeblog.com/

Leading Economics Bloggers Pessimistic, According to Kauffman Foundation Survey

Kauffman releases findings in its third ‘Economic Outlook: A Quarterly Survey of Leading Economics Bloggers’

(KANSAS CITY, Mo.), Aug. 4, 2010 – Top economics bloggers are feeling a renewed sense of pessimism about the U.S. economy, according to a new Ewing Marion Kauffman Foundation survey released today. Sixty-eight percent of economics bloggers who responded to the mid-July survey described the economy’s overall condition as “mixed,” with the rest split three to one toward an assessment of “weak” rather than “strong.” Worse, only 5 percent of respondents believe the economy is “better than official government statistics show,” while 47 percent think it is worse.

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BP Oil Spill: A case of prisoners’ dilemma

It has been said several times over, including my own posts, that the culture of BP was to blame for the disastrous oil spill in the gulf.  But applying a little game theory we reveal that there is a lot of blame to go around.  We miss a major point if we just look at the BP culture.  We need to look at the general business culture in the western world.

First a little on the prisoners’ dilemma.  As the story goes two prisoners are arrested for the same murder.  The police chief offers them both the same deal but separately.  He tells them both that whichever confesses first and names the other as an accomplice will get 10 years in prison, while the other will get life.  If both prisoners keep quiet, there is not enough evidence to convict either and they will be set free.  But being separated, they can’t confer and will try to cut the best deal for themselves and confess.  So as the story goes they both confess and each are sentenced to life in prison.  Had they both kept quiet they would go free.  So their dilemma is to trust the other prisoner to do what is best for everyone or just themselves.

So let’s apply the prisoners’ dilemma to BP and applying the most rigorous standards of safety possible.  If everyone does the same, then society will be better off and no one firms has a cost advantage.  If just one oil company choses to cut corners on safety, then they will have a cost advantage and thus a market advantage.  So short of regulatory requirements, each competitor will go optimize their position and go with the lowest safety standards possible.  Had just a single firm held to the high standards, then we can surmise that eventually they would be driven out of business by the lack of cost parity.  So what was BP to do.  Compete in the business environment that exists.

following the Occidental Petroleum disaster over 30 years ago, the British government change the rules for drilling in the North Sea.  Had the US government followed suit and also changed the requirements for drilling in its waters, BP and others would have been forced to follow more stringent safety standards.  Maybe the oil spill could have been avoided.

Stakeholder Management: More on BP Oil Spill

As I have thought more about my post on BP’s view of who its stakeholders are, I was reminded of an article I read on Stakeholder Management by Sandra Waddock.  Professor Waddock explained that corporations take one of three strategies when managing stakeholders:  Reactive, Proactive and Interactive.

It’s apparent to me that BP has taken a Reactive approach.  They seems to ignore any activities outside the companies boundaries.  BP ignored the potential risks involved in drilling with minimal safety standards.  They put the company profits ahead of everything else.  As Professor Waddock points out Reactive companies “do the minimum to meet the letter but  not the spirit of the law.”

Proactive companies take steps to anticipate issues developing from its external stakeholders.  Typically these steps are to create boundary spanning functions to address external issues.  These functions can include lobbyists, government relations and community relations.  Although, BP has positions within the corporation similarly titled, they seemed to be focused on protecting the BP brand and truly shine a spotlight on issues from outside the company.

We can only hope that BP will learn its lesson from this disaster and take an Interactive approach.  By becoming Interactive, BP would recognize the interdependence between it and its external stakeholders.  Such a stance would mean BP no longer tries to dominate or manage its external stakeholders but would engage them with a focus on mutual respect, interdependence and dialogue.  This Interactivity needs time to develop, a consistency effort and commitment of energy to creating a partnership.

It is my hope that BP and others will move towards this mutually beneficial approach.