Mission Statement

Mission statement explained - toolshero

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This article provides a practical explanation of the mission statement. After reading, you will understand the basics of this powerful strategy tool.

What is a mission statement?

A mission statement is a brief description of why an organisation exists, what the overall purpose of the organisation is, and what distinguishes it from its competitors. A mission is communicated to employees, customers, suppliers, and other stakeholders. A mission also creates a specific sense of identity among employees, and encourages employees to find innovative ways to jointly achieve common business objectives.

In his book ‘Strategic Management: Concepts and Cases’, Fred David explains that all mission broadly describe the capabilities, customer focus, and activities of an organisation.

A mission is often part of a business plan. Because they are of a continuous and ongoing nature, organisations typically do not change their mission statements.

Why is a mission statement important?

There are several reasons why a company must have a good mission. The most important reason is to ensure that everyone within the organisation is on the same page. In addition, it also serves as a basis for effective planning. The definition of the mission statement itself is often the result of a group effort. Capturing the mission statement is also regarded as a valuable team-building activity.

Moreover, the mission statement is part of the company’s face to the outside world; marketing. For example, many companies put their mission statement on the information page of their website and sometimes the company’s mission even becomes the core of their marketing strategy.

What should be included in a mission statement?

According to professor of strategy and management Chris Bart, a good commercial mission consists of three essential components. These are:

Mission statement components - toolshero

1. Key Market

What the target group of the company consists of.

2. Contribution

Which product or service the company supplies to consumers.

3. Distinction

Why this product or service is unique, and why the general public is better off buying it than any other.

What is the difference between a mission and vision?

There is often confusion about the difference between a company’s mission and vision. Nevertheless, these are both two different concepts. A vision statement focuses mainly on the future and what an organisation ultimately wants to achieve. A mission, on the other hand, focuses on what an organisation is currently doing to achieve this. Both concepts are essential for pursuing organisational goals.

Mission examples

  • Disney: To entertain, inform, and inspire people around the globe through the power of unparalleled storytelling, reflecting the iconic brands, creative minds, and innovative technologies that make ours the world’s premier entertainment company.
  • Facebook: Connect with friends and the world around you on Facebook.
  • LinkedIn: Create economic opportunity for every member of the global workforce.
  • Tesla: To accelerate the world’s transition to sustainable energy.
  • Google: To organise the world’s information and make it universally accessible and useful

Vision statement examples

  • Patagonia: “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”
  • McDonald’s: “To be the best quick service restaurant experience. Being the best means providing outstanding quality, service, cleanliness and value, so that we make every customer in every restaurant smile.”

How do I write a good mission in three steps?

A mission should be considered a combined explanation of what a company does and how and why it does it, expressed in a way that reflects a company’s core values. It can be quite challenging to put the right words together clearly and concisely. The following three steps explain in a simple way how you can write your own mission statement.

Step 1. Describe what your company does

Start by describing exactly what your company does. Make sure you get straight to the point about what the company produces. Take the foundation of the company’s core business, and don’t add any unnecessary information. The next steps will address the how and why of a company’s activities. Below are some examples of core goals of organisations:

  • Selling carpentry
  • Cultivating vegetables
  • Developing phone apps
  • Designing clothing
  • Providing financial advice

Step 2. Consider how your company does this exactly

Briefly describe how the company does what it does. This is a tricky part, because there is no need to provide a detailed description of what a company’s physical activities include. Instead, a description of how a company generally works should be created. This is translated into one or more core values of an organisation.

Take enough time to think about the core values and list them. Some example values that may be used for organisations include:

  • Superior quality product production
  • Protection of the environment
  • Stimulation of innovation
  • Sustainable development

Select the values that fit in a good mission. Focus on up to two core values.

Step 3. Consider why your company does this

This part of the mission describes the passion behind a company. Answer questions such as: why does my company do what it does? Why do we think this work is important? For some people, it helps to think about why they started the business in the first place.

Example mission statement toolshero

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Tips for writing a mission

Writing an effective mission seems difficult for many people, but here are some tips for writing a good mission statement. Consider the following do’s and don’ts.

Keep It Simple Stupid (KISS)

Summarise your company’s mission in a few sentences. Don’t write a long essay. This is not the intention of such a brand building tool. The mission must be anchored to the brand, and therefore must be memorable. No one will remember long sentences or even paragraphs with explanations. Keep It Simple Stupid!

Think about the long term

Preparing a mission is an investment in the future of your own company. You should therefore take into account the long-term goals of your organisation and reflect them in the mission statement. Don’t make the mission statement too restrictive.

Involve employees

The usefulness of a mission statement also lies with employees. Ask for their opinion and don’t be afraid to change things. Things are always changing, and if a mission statement doesn’t match or suit a company, it should be time for a new statement.

How much value does a mission statement truly have?

Many executives will agree that a company’s mission, vision, and values have only limited influence on the way most employees perform their jobs. In an Forbes article by Len Sherman, he sceptically expresses what managers think of their organisation’s mission statement. Many of these managers don’t even know the company had a mission statement, and others know very little about it.

This is because the focus on organisational goals and the fundamental of an organisation are quickly forgotten. Every day, managers and leaders are confronted with many different interests, varying demands from shareholders, customers, communities, and even natural forces. In this situation, rather than focusing on a company’s fundamentals, it is easy to get stuck in the daily grind.

An example mentioned in the aforementioned Forbes article is Lumber Liquidators. They promised to focus on meeting the highest safety standards available, like no other company in the industry. However, in 2015 a television programme revealed that the company was shipping products with dangerously high levels of a known carcinogen. So much for the mission statement.

These are extreme examples of course, but the fact remains that many companies no longer pursue their founding goals. An example of an organisation that is successful in this is Amazon. No other CEO other than Jeff Bezos creates more shareholder value. This is the result of clear business objectives and a clearly communicated mission statement that provides meaningful guidance at all levels of the more than 300,000 employees.

Advantages mission statement

There are several advantages to developing and disseminating a good mission. Read about these below.

It acts as a rudder

Mission statements act as the helm or compass of an organisation. These help organisations navigate the jungle of competition and problems. This is one of the most obvious benefits of a mission statement. Without a clear mission, an organisation is more or less aimless.

Conflict resolution

Another advantage of a clearly formulated mission statement is that members of the board of directors can point out the mission to each other in times of conflict. In these times, they make it clear to one another that the mission statement reflects why the company was founded, and that everyone in the board of directors has an interest in keeping the organisation on the current (or other) course.

Means of communication

A mission statement has another very important advantage: it acts as a means of communication. Communication in a company is very important for its founders, management team, and employees. A mission statement is the communication of the company’s wishes and perspectives to other members of the organisation.

Support in decision-making

Managers and leaders who make decisions are constantly faced with difficult challenges. Is this an economically sound choice? Does this decision meet the wishes and needs of all stakeholders? These are very difficult considerations, and a mission statement may help. It acts as a framework with which effective managers can easily chart a course in fulfilling their management duties.

Disadvantages of mission statements

As we have previously seen, some mission statements can be too ambiguous or even worthless. The major disadvantage of mission statements is that there is a very high probability that the design and implementation is wrong. A mission statement can quickly become too vague, meaningless, or confusing. Other disadvantages include:

Conflicts and inconsistencies

If a mission statement is flawed, one part of the mission may contradict another. This ultimately leads to conflicts and consistencies.

Unrealistic

When drawing up a mission statement, optimism or inexperience can make the mission statement unrealistic. Reality, however, is not as simple as on paper. A fundamental weakness of mission statements in general is that they are unrealistic in most cases. Too optimistic.

Now it’s your turn

What do you think? Are you familiar with the explanation of the mission? Do you agree with the mission statement of the company you work for? Do you believe mission statements are important for the proper functioning of an organisation? Can you think of a mission statement and share an example company with us? Do you have any other tips or additional comments?

Share your experience and knowledge in the comments box below.

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More information

  1. Bartkus, B., Glassman, M., & McAfee, B. (2006). Mission statement quality and financial performance. European Management Journal, 24(1), 86-94.
  2. David, F. R., & David, F. R. (2003). It’s time to redraft your mission statement. Journal of Business Strategy, 24(1), 11-14.
  3. Mullane, J. V. (2002). The mission statement is a strategic tool: when used properly. Management Decision.
  4. Pearce, J. A., & David, F. (1987). Corporate mission statements: The bottom line. Academy of Management Perspectives, 1(2), 109-115.

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