Strategic Management: Formulation and Implementation

Mission And Objectives - Summary

Two main organizational ingredients are commonly used to establish organizational direction: organizational mission and organizational objectives.

Mission is the fundamental concept which defines the organization's reason for existence. Mission and a sense of mission are important to business success they help organizations to move in a united direction, make consistent decisions and strategies, and harness the skill and commitment of the work force.

Mission statement is the articulation of company's mission. It represents the personality of company. In developing a mission statement the manager must answer the following questions: "Why does the organization exist?" "What business are we in?" "What customer do we serve?"

When a mission statement is developed from this perspective, it provides a guide to decision making for all levels of management. Without a statement of mission, it is impossible for an organization to develop objectives and strategies.

The second direction-setting step is to establish objectives for the organization to achieve. An organization's objectives depend on the particular organization and its mission. Therefore, objectives convert mission statement into specific performance targets. In this chapter I have explored objectives, looking at where the organization is going and considering why.

In is not uncommon to see corporate objectives expressed in the areas of growth, profitability, market share, stakeholders welfare, and social responsibility. Therefore, in developing organizational objectives, managers should analyze trends, develop objectives for the organization as a whole, create a hierarchy of objectives, and specify individual objectives.

Although mission and objectives are so fundamental, they should no be viewed as totally inflexible. Systematic reconsideration of mission and objectives is part of the strategic management process.

Together mission and objectives comprise the third aspect of assessing strategic situation, which must be done before strategy alternatives are formulated.

The strategy alternatives open to the organization are discussed in next Chapters.