Confusing? Yes, quite often. I just got another confused and confusing e-mail on this topic. Maybe it will help to clear it up. If nothing else, it will make me feel better. People use these different terms loosely, in some cases interchangeably. These are good things to think about, particularly when you’re thinking about your core identity, what makes your business you and things like that. Of course you don’t have to write them out, not all of them ever, not even some of them until you’re doing that formal plan for outsiders. But they can all help you settle your business identity.
Mantra
My favorite these days is the mantra. A single sentence that describes what your business does for people.
A mantra is three or four words long. Tops. Its purpose is to help employees truly understand why the organization exists.
Mission
A mission statement should be a simple statement of how you’re going to help three groups: your customers, your employees and your owners. If you can’t tell your mission statement from any other, if nobody could guess that it’s you, then you have work to do. Do one only if you’re going to use it. Don’t do just hype!
How do you use it? Use it to define your company by its long-term goals. What business are you really in? Use it to remind everybody what the business wants to do, and make sure it covers all three groups. Not just customers. Employees and owners too.
The Vision
It’s confusing. I confused vision with mission for years. It finally made sense to me when somebody suggested a vision was a matter of projecting a dream forward in time, like a dream view of something three, five, maybe even 10 years hence, your vision of the future related to your business.
For example, a hotel development, auto repair shop or a web business might easily have a vision for how things will look a few years hence.
Goals
Usually they’re for the mission statement, but it doesn’t matter what form. Make sure you review your goals every so often. What do you want from your business? Think about it. It’s not all that obvious. You might think it’s about growth and profits and success, but then how do you measure success? That’s not a simple question.
- Many businesses are about lifestyle. Having time to spend with children. Independence. Doing what you want to do. Making money from things you’d do for free. Your paintings. Your novel. Coaching people in soccer or backpacking. These things matter.
- Many businesses are about business. You want to make as much money as possible. You want to be the richest person at the next class reunion.
I think of goals as broad and conceptual. Goals are important, but not necessarily measurable in any specific, objective way. Objectives are measurable business goals.
Objectives
Objectives are business goals. Set your market share objectives, sales objectives and profit objectives. Companies need to set objectives and plan to achieve them.
Make sure your objectives are concrete and measurable. Be specific, such as achieving a given level of sales or profits, a percentage of gross margin, a growth rate or a market share. Don’t use generalities like “being the best” or “growing rapidly.”
For example, “being the best” or “maximizing customer satisfaction” are not serious business plan objectives because they cannot really be measured. Much better objectives would set measurable goals, such as holding gross margin to 25 percent as a minimum, selling more than $3 million or achieving 6 percent profit on sales and 10 percent return on equity.
If less tangible goals are critical to a plan, find a way to measure them. For example, if image and awareness are vital, then plan for statistically valid surveys to measure the improvements in image and awareness. You can also set goals for market share and purchase research to measure the actual share. Or if you want to focus on customer satisfaction, plan for a survey to quantify satisfaction or specify numerical objectives regarding returns or complaints.
I specialise in assisting businesses define themselves especially in the new marketplace "online". So if you need any help please do not hesitate to contact me.
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