7 Reasons Why Your Company Needs A Mission Statement

Your Company Needs a Clear, Written Mission Statement

Sometimes business owners ask me if it is that important to have a written mission statement. In many companies, it seems like a plaque on the wall with little or no value. Here is why I think every business (even small businesses) must have a clear, written mission statement.

1. A Mission Statement Determines The Company’s Direction

Astute business owners wield the power of the mission statement to continuously emphasize to their teams the very reason for their company’s existence. They understand that this profound sense of purpose is the key ingredient that fuels the company’s success. The mission statement, with its concise articulation of goals and values, serves as an enduring “North Star” – a guiding light that maintains clarity on the organization’s set course. It ensures that every stakeholder, from top executives to entry-level employees, understands and works towards the company’s defined direction.

As leadership expert Andy Stanley aptly put it, “It’s your direction, not your intention, that determines your destination.” This quote underscores the importance of the mission statement in guiding a company’s actions. Intentions, however noble or ambitious, are secondary to the company’s chosen path. A well-defined and communicated mission statement, therefore, helps align all actions and decisions with the company’s overall direction, facilitating progress toward the desired destination.

2. It Focuses O The Company’s Future

Writing a mission statement is instrumental in focusing a company on its future, even though it might be distinguished from a vision statement. Here’s how:

  1. Provides a Path: The mission statement describes what the company does today, which in turn provides the path for its journey toward its future (vision). It outlines the core activities that are expected to drive the company to its desired state.
  2. Acts as a Guide: The mission statement acts as a guide for the company’s current operations and decisions. The actions taken in line with the mission statement today will pave the way for reaching the envisioned future.
  3. Ensures Alignment: The mission statement ensures that all activities are aligned with the company’s long-term goals. It ensures that all efforts are concentrated on tasks that contribute to reaching the vision.
  4. Creates a Foundation: A solid mission statement forms the foundation upon which the vision can be built. By defining what the company is doing today, it helps in setting realistic, achievable goals for the future.
  5. Informs Strategy Development: The mission informs strategy development by defining the company’s purpose and the means to achieve it. These strategies then contribute to reaching the preferred future.

In essence, while the vision statement paints a picture of the desired future, the mission statement provides the blueprint for the actions needed to reach that future. It helps the company focus on its present activities that will lead it towards its envisioned future state.

3. Your Missions Statement Provides A Template For Decision-Making

A clear mission sets important boundaries which enable business owners to delegate both responsibility and authority. The mission is to the company what a compass is to an explorer, a map to a tourist, a rudder to a ship, and a template to a machinist. It provides a framework for thinking throughout the organization. It provides the boundaries and guardrails you need in order to stay on the path to your preferred future. Here is how:

  1. Sets Boundaries: A clear mission statement defines the scope of a company’s operations, setting boundaries for what it should and should not engage in. This helps in focusing resources and efforts on areas that align with the company’s purpose.
  2. Delegates Responsibility and Authority: By setting these boundaries, a mission statement also enables business owners to delegate responsibility and authority effectively. Employees are given clear directives on their roles and how they contribute to the company’s mission, fostering accountability and initiative.
  3. Guides Decisions: Like a compass or a map, a mission statement serves as a guide for all decision-making within the organization. It helps assess whether a potential decision or action will support the company’s mission and move it closer to its desired future.
  4. Establishes Framework for Thinking: The mission statement provides a framework that shapes the company’s strategic thinking. It guides problem-solving, innovation, and planning processes, ensuring they align with the company’s core purpose.
  5. Creates Organizational Guardrails: The mission acts as guardrails, keeping all activities and decisions on the right path. It prevents deviation from the company’s core purpose, helping maintain focus and prevent costly missteps.

In essence, a mission statement functions as an indispensable tool that guides a company’s operations and decisions, helping it stay true to its purpose and navigate toward its preferred future.

4. The Mission Statement Forms the Basis For Alignment

When a new employee is hired, the new hire must know what the company does and where the company is going. The mission statement forms the basis for alignment not only with the owner but with the entire team and organization. Your team will all be on the same page regarding what you do and why you do it, which leads to better effectiveness and efficiency.

  1. Establishes Common Understanding: A mission statement clearly articulates what the company does and why it does it. This shared understanding ensures that everyone, from new hires to seasoned employees, knows the company’s purpose and direction.
  2. Promotes Cohesion: The mission statement forms a common ground that brings everyone on the same page, creating a sense of unity and cohesion within the team. This helps in fostering a strong and aligned organizational culture.
  3. Guides Employee Actions: With a clear mission statement, employees understand how their individual roles and responsibilities contribute to the company’s broader goals. This alignment of personal objectives with the company’s mission enhances job satisfaction and productivity.
  4. Increases Effectiveness and Efficiency: When all team members understand and align with the company’s mission, they work more effectively and efficiently. There is less confusion and conflict about the company’s goals, which translates into smoother operations and better decision-making.
  5. Improves Communication: A clear mission statement also improves internal communication. It provides a standard language that can be used across the organization, reducing misunderstandings and enhancing collaboration.

Therefore, a well-defined mission statement forms the basis for alignment within an organization, driving cohesion, efficiency, and effectiveness while ensuring everyone is moving toward the same goals.

5. Your Mission Statement Welcomes Helpful Change

Many people are resistant to change because it causes them to feel insecure and sometimes out of control. However, if the mission is clear, then team members are more likely to see the value of the change and how it helps the organization accomplish the mission. This will create a culture that welcomes change when warranted.

Changes, while often necessary for growth and innovation, can create unease among team members, as they can disrupt established routines and expectations. This is where a well-crafted mission statement comes in.

When the mission of an organization is clear and firmly established, it acts as a steady anchor amidst the shifting tides of change. Team members can see the purpose behind the transformations, and then understand how these changes align with and help the organization accomplish its mission. This transparency helps alleviate feelings of insecurity and loss of control that can accompany changes, instead fostering a sense of purpose and direction.

Moreover, a clear mission statement can help create a culture that not only accepts but also welcomes change. When employees see change as a means of fulfilling the mission more effectively or efficiently, they are more likely to embrace it willingly. They see it not as a disruption, but as an opportunity for improvement and growth that is in line with the organization’s core purpose.

6. The Mission Shapes Strategy

Every business and business owner needs a strategy. But strategies must not be created in a vacuum. Instead of looking at what’s new or what competitors are doing and trying to copy them, wise business owners create the most effective strategies possible to accomplish the mission their company is set out to accomplish.

The mission statement, with its clear articulation of the company’s purpose and objectives, provides a broad direction for this journey. It outlines what the company stands for and what it aims to achieve, thus giving structure and direction to the formulation of strategies.

Furthermore, a well-defined mission statement ensures that strategies are not developed in isolation or merely in reaction to market trends or competitors’ actions. Instead, they are deliberately crafted to align with the company’s core purpose and objectives. This approach to strategy creation ensures that all strategic decisions are made with the ultimate aim of fulfilling the company’s mission.

In this way, a mission statement acts as a guiding beacon, ensuring that all strategic initiatives are purposeful, aligned, and designed to propel the company toward its mission. It keeps the company focused on its unique path and prevents it from getting sidetracked by distractions or short-term opportunities that may not serve its long-term mission.

7. The Mission Facilitates Evaluation and Improvement

The statement, “What you measure will be your mission,” highlights the importance of aligning your performance metrics with your mission. A clear, written statement of mission provides the foundation for developing relevant and meaningful metrics. It ensures you are not only measuring the right things but also interpreting those measures in the right context – that of your mission. In other words, the mission statement makes clear what matters most for the organization and hence, what should be measured and monitored.

By providing a concrete basis for performance measurement, a mission statement also opens up avenues for continuous improvement. Regular evaluation against the mission allows for the identification of gaps between the current performance and the desired outcomes as stated in the mission. This gives the organization the insights it needs to devise and implement effective strategies for improvement.

Furthermore, clarity of mission translates into clarity at every level of the organization. When every team and individual knows exactly what they are working towards – as articulated in the mission statement – they can align their actions, decisions, and improvements with the company’s overarching goals. This ensures a unified and focused approach to continuous improvement across the organization.

Clarity of mission brings clarity on every other level of the organization.

I’ve already discussed how to write a mission statement in a previous video blog. I hope you can see the value of a written statement that is discussed and used in regular evaluations. This is the foundation of a powerful organization!

If you’re interested in gaining clarity be forming a powerful mission statement for your company or organization, contact us for a No-Obligation Strategy Session to help you get started. 

Glenn Smith is a sought-after Executive Coach with over two decades of experience. Recognized for his strategic insights and leadership training, Glenn has been a guiding force for more than a hundred successful small to mid-sized businesses. Merging data-driven strategies with profound insights into human behavior, he aids business owners and executives in realizing their fullest potential. A respected thought leader, Glenn has contributed to numerous business publications and is a popular keynote speaker. Outside his professional realm, Glenn cherishes family time and outdoor activities. He is a pilot with over 30 years of flight experience. He is also a professionally trained gunsmith and a firearms instructor. His dedication to fostering leadership and driving transformative change marks him as a premier figure in executive coaching.

LinkedIn: www.linkedin.com/in/houstonbusinesscoach/

3 thoughts on “7 Reasons Why Your Company Needs A Mission Statement”

  1. I just have no idea how very successful companies and businesses managed in the past without mission statement. Perhaps they didn’t need a statement of the very obvious -which is all mission statements actually are.

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