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Journal of Entrepreneurship &Organization ManagementzaniISSN: 2169-026Xtion Man agnt repreof Enalip & OrgrshaeuentemJournResearchPerspectiveBora et al., J Entrepren Organiz Manag 2017, 6:1DOI: 10.4172/2169-026X.1000205Open AccessCrafting Strategic Objectives: Examining the Role of Business Vision andMission StatementsBora B1, Borah S2 and Chungyalpa W1*Department of Management Studies, Sikkim Manipal Institute of Technology, IndiaDepartment of Computer Applications, Sikkim Manipal Institute of Technology, India12AbstractThere exists abundant literature on business strategy topics. Yet very few of these examine the role of businessmission and vision statements and their influence on strategic objectives. It is this apparent gap in the literature that thispaper aims to cover. The paper aims at highlighting the importance of business vision and mission statements and howthese dictate the strategic goals and objectives of the organization - both short term as well as long term.The paper consists of three sections. The first section provides a quick overview of business strategy. The remainingsections discuss the mission statement and vision statement. It provides guidelines including templates on how todevelop effective mission and vision statement. Finally, it applies the learning’s to a case study - that of a hotel. My aim isto highlight how the three - mission statement, vision statement, and strategic objectives - are intertwined. It is necessaryto first define the mission and vision statement prior to defining the strategic objectives. The mission and particularly thevision statement provide the foundation upon which strategic objectives are framed.Keywords: Business vision statement; Business mission statement;Strategic objectives; Strategic objectives alignmentIntroductionIf we were to conduct a survey of small (especially micro) businessesin India, majority of the businesses will reveal that they do not havea vision and mission statement. Indeed, majority of these businessesfunction without having a vision and mission statement and in somecases even a working strategy. Although business textbooks emphasizethe importance of mission and vision statement, yet businesses seemto place minimal importance on it. The role of the mission and visionstatement is not well understood yet it forms a integral part in strategydevelopment and formulation but first we start by examining theconcept of strategy.Business Strategy: An OverviewCrafting and executing business strategy is the centrepiece ofmanaging an enterprise. While there is no single definition that definesstrategy, generally a company’s strategy is the plan of action thatdetermines the following: Its market position How it conducts its operation How it attracts and retains new and existing customers How it competes with other firms and How it achieves its organizational objectives [1].One approach to understanding strategy is by examining itspurpose and scope.PurposeWhat is the strategy primarily designed to accomplish? This is oneof the key differentiators. For example, a marketing strategy is designedto achieve marketing objectives, likewise, a quality strategy is designedto achieve quality objectives.ScopeScope refers to the breadth or boundaries of the strategy. SomeJ Entrepren Organiz Manag, an open access journalISSN: 2169-026Xstrategies such as business strategies are enterprise wide. It providesdirection for the entire firm. The functional areas of an enterprisei.e. marketing, finance, human resource, information systems etc.accordingly frame operational strategies on their part to support thebusiness strategy. Other strategies are much more focused and narrowin scope. For example, promotional strategy to advertise and promoteevents, programs, new product etc.Thompson and Strickland provides one of the best definition of thevarious types of strategy used by organizations. They talk of the strategypyramid. Essentially, they state that strategy exists at many differentlevels. At the top of the strategy pyramid is the corporate strategy,below it is the business strategy, below that the functional strategy, andfinally at the base of the pyramid is the operational strategy. This isdepicted in Figure 1.Each level has unique objectives, stakeholders, and scope. Thecorporate strategy is applicable to diversified firms with multipledivisions i.e. business units. Since all the divisions fall under a singlefirm, the corporate strategy is the overall strategy that encapsulates allthe firm’s business units. A corporate strategy is high level game plan forthe firm. It involves management at the highest level (executive level).It deals with issues such as, which industries should the firm competein, how to improve the competitive position and profitability of all itsvarious business units, which business units should be provided thehighest priorities in terms of resource allocation and investments etc.*Corresponding author: Wangchuk Chungyalpa, Assistant Professor, SikkimManipal Institute of Technology, Management Studies, Majitar, Rangpo,East Sikkim 737132, India, Tel: 9679260992; E-mail: d Sepetember 10, 2016; Accepted February 03, 2017; Published February10, 2017Citation: Bora B, Borah S, Chungyalpa W (2017) Crafting Strategic Objectives:Examining the Role of Business Vision and Mission Statements. J EntreprenOrganiz Manag 6: 205. doi: 10.4172/2169-026X.1000205Copyright: 2017 Bora B, et al. This is an open-access article distributed underthe terms of the Creative Commons Attribution License, which permits unrestricteduse, distribution, and reproduction in any medium, provided the original author andsource are credited.Volume 6 Issue 1 1000205
Citation: Bora B, Borah S, Chungyalpa W (2017) Crafting Strategic Objectives: Examining the Role of Business Vision and Mission Statements. JEntrepren Organiz Manag 6: 205. doi: 10.4172/2169-026X.1000205Page 2 of 6Figure 1: Strategy pyramid.The business level strategy is strategy levelled at the individualbusiness units. Business strategy is primarily aimed at businesseslong term competitive position in the marketplace. A business planis management’s plan of action and responses to ‘competitive forces,economic trends, technological developments, buyer needs anddemographics, new legislation and regulatory requirements’ and otherimportant external factors that have an impact on the performance andprofitability of the business [2]. For single business company, corporatestrategy and business strategy are the same.Functional strategies are strategies designed at the departmentallevel for example, production, marketing, finance, human resourceetc. It can also refer to major functional processes such as new productdevelopment. Functional strategies are designed to achieve thedepartmental objectives and goals. However, much like the businesslevel strategy, a functional level strategy must also support the overallcorporate and business strategy of the company.Finally, at the base of the strategic pyramid is the operating strategy.Operational strategy oversees two key areas:Operational units of the organization: These refer to units suchas plants, warehouse, distribution centres etc. Each unit requires aunique strategy to oversee its operations. Such strategy should becomplimentary to the functional strategy under which the unit belongsand the overall business strategy of the organization.Operational tasks: refers to key activities such as materialspurchasing, inventory maintenance, logistics management, customerreturns processing etc. Each such task requires a unique strategy [2,3].Developing Business Mission StatementDeveloping a mission statement is the first step in setting strategicdirection. A mission statement describes the company’s presentbusiness scope. It identifies ‘who they are’ and ‘what they do.’ Themission statement identifies the products and services being offered bythe company, types of customers it has, and technological and businessJ Entrepren Organiz Manag, an open access journalISSN: 2169-026Xcapabilities of the company. A mission statement is a description of thecurrent business of a company. The mission statement can be used asthe basis for deciding where a company is headed in the future.A well-defined mission statement incorporates the following threeelements.Customer needs i.e. what is being satisfied: Customer groups i.e. who is being satisfied Company’s activities, technologies and competencies i.e. howthe company goes about satisfying the wants and needs of itscustomers.A mission statement that incorporates all the above three elementscan be considered as a complete mission statement. It identifies theproducts and services currently being offered by the company as wellas the customer group.Major tasks Identify the target customers Identify the core products and services offered by the business Identify the key activities and capabilities to support theproducts and service offerings.The following template can be used in framing the mission statementof the company:Business mission statement templateBusiness mission statement template is given in Table 1.Applying Concepts to a Case StudyI start by completing the business mission statement template forXYZ hotel. The template serves as a starting point in formulating themission statement (Table 2).Volume 6 Issue 1 1000204
Citation: Bora B, Borah S, Chungyalpa W (2017) Crafting Strategic Objectives: Examining the Role of Business Vision and Mission Statements. JEntrepren Organiz Manag 6: 205. doi: 10.4172/2169-026X.1000205Page 3 of 6Target Customer GroupI.NameDescriptionII.S.noCore products and service offeringsNameDescriptionKey activities and CapabilitiesTable 1: Business mission statement template.Target Customer GroupNameDescriptionHoneymooners/couples onlyRefers to newly and recently married couples. They consist of just the husband and wife without any children.Nuclear Family/one to four kidsRefers to nuclear family usually consisting of the husband, wife and children.Joint familyRefers to a joint family. A joint family is accompanied by the grandparents, relatives, friends and others.Core products and service offeringsNameHoney moon suitDescriptionKey activities and capabilitiesSuit designed specifically for honeymooners.Double suitLarge suit consisting of twin beds where extra beds can be accommodated.Designed for joint family and large families.Infrastructure capabilities and Excellent serviceStandard double suitSingle suitStandard single suitCatering serviceCatering service available for eventsExcellent serviceFor events i.e. weddings, birthdays, conferences etc.Infrastructure capabilitiesFamily suitRestaurant serviceRent a HallExcellent cook and serviceSightseeing servicesLocal sightseeing serviceGift (souvenir) shopLocal handicraftsExcellent networkTable 2: Business mission statement template for XYZ hotel.Having completed the above template, I now have enough materialsto create a mission statement for the organization. The template servesas a vital input to the process. We should avoid creating a detailedprofile of the target customers or creating a detailed profile of theproducts and service offerings at this stage. At this stage the idea is tomerely identify the target customer groups and define the product andservice offerings in general. A more in-depth analysis and evaluationcan be done at a later stage.Next, we frame the mission statement for the organization.Mission statement for XYZ hotelXYZ Hotel is dedicated to providing the best care and comfort forour customers. We provide the best quality food and accommodationarrangements for our guests. All our rooms are furnished with all thenecessary amenities including free Wi-Fi services and local area networkconnection detailing various sightseeing places, local attractions,eateries and much more. Each room commands an inspiring view ofthe local landscape.Our other services include event hosting service, restaurant service,gift shop, sightseeing tours, and business services.Our excellent infrastructure and world class service makes us anexcellent venue for weddings, birthday parties, graduation parties etc.We delight in offering excellent in-house restaurant service with adiverse menu and unmatched services. Our gift shops pride in carryingthe local handicrafts of the region. Each item undergoes stringentquality control to ensure the best value for the price. Our deliveryservice can guarantee delivery to all major metropolitan cities in India.We provide insurance and warranty coverage for all gifts bought fromour store. Our sightseeing services are designed with the customerin mind. We offer unique packages designed specifically to meetthe varying needs of our guests. Our fleet of transportation vehiclesJ Entrepren Organiz Manag, an open access journalISSN: 2169-026Xand our wide network with local businesses ensures a convenientand hassle free trip. Our business services include amenities such asvideo conferencing, printing, photocopying, and scanning services. Inaddition, we offer various computers and workstations with the latesttechnologies and configurations all connected to the internet via highspeed broadband connections. We strive to meet even the unexpressedneeds and wishes of our guests.Developing Business Vision StatementNext comes the vision statement for the organization. The visionstatement essentially specifies ‘where an organization is headed.’ Itprovides long term direction to the company. A vision statement is avery important strategic tool. A vision statement normally considersthe company position and situation five years or more from today. It isaimed at answering key questions such as: Where do we want to be five years from hence? What new products and services should we be offering? What industry standing do we want to achieve? What are the changes in our target customers - which newtarget customer groups should we focus upon?Setting the vision statement is a precursor to setting objectivesand goals. It is the vision statement that dictates the company strategicobjectives and goals. Strategic vision is a reflection of management’sintentions and goals concerning the future of the organization. It isa reflection of how well the management have considered the futureof the company. Setting the vision statement requires analysing theinternal and external business environment. It is aimed at shaping thebusiness direction and path for the next five years. It is also aimed atunderstanding how its present business needs will change in the yearsto come.Volume 6 Issue 1 1000204
Citation: Bora B, Borah S, Chungyalpa W (2017) Crafting Strategic Objectives: Examining the Role of Business Vision and Mission Statements. JEntrepren Organiz Manag 6: 205. doi: 10.4172/2169-026X.1000205Page 4 of 6Major tasksS NoWhat changes are occurring in the Market Arena and whatimplications do these changes have for the business? What new or different customer needs should we be movingto satisfy? What new or different buyers segment should we beconcentrating on? What new geographic or product market should we bepursuing? What should the company’s business make up look like in fiveyears? What kind of company should we try to become [2]?In creating the vision statement for the organization, the followingtemplate can be used to define the vision statement. The template is asummary of the important points to consider while formulating thevision statement (Table 3).1Current changes in theexternal environment.2Expected (future)changes in the marketenvironment Wide use of internet technologies to supportbusiness functions. Seamless connectivityacross platforms and devices (mobileconnectivity). Adoption of computer based informationsystems to support business transactions.3New or differentcustomer needs Customers today are tech savvy and selfsufficient travellers. Customers are health conscious. Adventure sporting4New or different buyersegments Growing middle class with more disposableincome International clients5New Geographic orproduct market Opening hotels in the immediate surroundingareas – popular tourist’s destinations.6Business make up fiveyears from hence Adventure sporting services Health and fitness servicesTable 4: Analysis of external environment.Applying Concepts to a Case StudyAnalysis of external environment is given in Table 4.Vision Statement for XYZ hotelWe are committed to providing the best food and accommodationsfor our local, national, and international customers. We want to bespecially remembered for our unique hospitality, fitness and wellbeing,sports adventure, and delectable cuisine. Our target is to become theindustry best in both national and international arena. To this endour aim is to adopt eco-friendly and sustainable business practices;deliver a healthy, safe, comfortable and secure experience; and provideunparalleled user experience via seamless connectivity across devicesand platforms. Our goal is to offer the highest quality of customersatisfaction.Setting Strategic ObjectivesOnce the business vision statement has been defined, the nextstep is defining the strategic objectives for the business. The businessvision statement is a key input to this process. The business visionstatement defines the strategic objectives and goals of the organization.Setting strategic objectives transforms the strategic vision into specificperformance targets. Setting strategic objective is a key element ofcrafting strategy. It is a very important exercise to ensure that theorganization’s long term plans and goals are attained. It exhibitsmanagement’s commitment to action and outcomes. All objectivesmust meet the SMART criteria to be effective. The SMART methodologyis a widely-used technique to frame meaningful objectives. SMART isan acronym that stands for:S. NoTopic1Current changes in the external environment2Expected (future) changes in the market environment3New or different customer needs4New or different buyer segments5New Geographic or product market6Business make up five years from henceTable 3: Business vision statement template.J Entrepren Organiz Manag, an open access journalISSN: 2169-026XAnalysis National tourism is picking up. The Indiangovernment and various state governmentsare strongly promoting domestic tourism. International tourism is picking up. Eco friendly practices are becomingstandard among hotels i.e. renewableenergy sources and water conservation(Jacobs, 2015).The process of formulating strategic vision involves answering thefollowing sets of questions: TopicQualitative objectiveQuantitative objectiveTo improve customer satisfactionand service provided by theorganization.To decrease customer complaints/supportcalls by 20%.To increase repeat customer base by 25%.Table 5: Qualitative vs quantitative objectives – a comparison.PillarProductBuilding Blockof BusinessModelA Value Proposition is an overall view of aValue Proposition company's bundle of products and servicesthat are of value to the customer.Target nagementAnalysisDescriptionThe Target Customer is a segment ofcustomers a company wants to offer value to.Distribution Channel is a means of getting intouch with the customer.The Relationship describes the kind of link acompany establishes between itself and thecustomer.The Value Configuration describes thearrangement of activities and resourcesthat are necessary to create value for thecustomer.A capability is the ability to execute arepeatable pattern of actions that is necessaryin order to create value for the customer.PartnershipA Partnership is a voluntarily initiatedcooperative agreement between two or morecompanies in order to create value for thecustomer.Cost StructureThe Cost Structure is the representationin money of all the means employed in thebusiness model.Revenue ModelThe Re
Crafting and executing business strategy is the centrepiece of managing an enterprise. While there is no single definition that defines strategy, generally a company’s strategy is the plan of action that determines the following: Its market position How it conducts its operation
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