About Linda Henman, Ph.D.

Linda Henman, Ph.D. helps senior leaders reach strategic objectives by maximizing talent. She is the author of Challenge the Ordinary and Landing in the Executive Chair, among other works. She can be reached at 636.537.3774, or visit her website www.henmanperformancegroup.com

Four Key Questions for Writing an Effective Mission Statement

How to Write a Mission StatementSeveral years ago, while working with the leaders of a family-owned business to set their strategies for the next year, I asked to see a copy of their mission statement. Looking confused and more than a little annoyed, the father said he thought it was somewhere around there in a framed picture, and the son felt pretty sure they had hired a company to put it on some mouse pads a few years ago.  But neither father nor son could recite the mission statement!  At one time, they had written and wordsmithed a mission statement, but clearly it no longer served as the foundation for their strategy formulation, nor apparently, even for their desk accessories. These owners, unfortunately, represent a common mindset.  Too often leaders assume that simply creating (or having a consultant create) and distributing a mission statement will accomplish something important. It won’t

As I explained to my clients, before taking any steps to formulate a strategy, they should have a clear understanding of the mission and of their organization. A mission statement should play the same role in an organization that the Holy Grail did in the Crusades. A mission defines your reason for being, the touchstone against which you evalu­ate your strategy, activities, and expectations for overcoming the competition. Without one, you will diffuse resources, enable individual units of the organization to operate in silos, create conflicting tactics, and confuse customers, suppliers, financiers, and employees. Conversely, when you have a well-articulated sense of purpose, you will build a firm foundation that provides clear guidance for all significant decisions and establishes a point of reference for setting strategy and planning its execution.

An effective mission statement answers these questions:

Why do we exist?

Who are our best customers?

What do they expect of us?

Who would miss us if we went away?

In addition to defining the organization’s identity, the mission guides its development over time.  Although it should be resistant to capriciousness, as the external landscape changes, leaders must tweak the mission statement as they recognize how to translate purpose into practice.

To draw an example from the for-profit world, in 1979 Americans experienced long lines at the gas pumps.  Gas prices soared (or at least we thought so then) to 86 cents a gallon while supply dwindled. The writing had been on the wall years earlier, but not everyone at the Ford Motor Company read it. At the time, Henry Ford II served as the chairman of Ford.  Lee Iacocca headed Ford US, and Hal Sperlich served as Iacocca’s deputy of product design.

Three years earlier, in 1976, recognizing the American car buyer’s need to respond to gas shortages, and certain that the American market would demand smaller cars, Hal Sperlich recommended that Ford downsize its automobiles, advocating smaller, more fuel-efficient cars to compete with foreign imports. Henry Ford disagreed.  He pontificated that he did not want a small, new, front-wheel-drive car because he didn’t think the market would change too much.

“Small cars mean small profits” became his mantra.

For years key leaders at Ford disagreed about the fundamentals of their mission. Iacocca and Sperlich agreed with each other about what they wanted the mission to be—to respond to customer demands—but Henry disagreed. He wanted to stick with the status quo. The stalemate led to dire consequences. Ford fired Sperlich, and the American car buyer punished Ford Motor Company.  Iacocca went on to write a bestseller entitled, Iacocca, but he could have just as easily called it I Told You So! As Iacocca foresaw, failure to make decisions based on the mission of the organization would cost Ford dearly in the late seventies, yet more than 30 years later, organizations still mistake the writing on the wall for graffiti when it comes to putting purpose into practice.

Every organization is headed somewhere. Too often, however, that direction is not the result of a conscious choice. My not-for-profit clients recite the mantra, “No margin, no mission.” I counter with “No mission, no success.” The decision to write an effective mission statement offers the winning formula for that success. Answering the four key questions will seal the deal and keep you from the quagmire Ford found himself in.

Nonprofits Profit from a Strong Strategic Principle

Nonprofits Profit from a Strong Strategic PrincipleFor any nonprofit organization, results start with a strong strategic principle—a shared objective about what the organization wants to accomplish. A strong mission and clear vision lead the way, but setting the strategy demands more. Leaders of successful organizations realize that they can’t just run fast; they have to make sure everyone runs in the same race—the right race—without tripping at the finish line. A clear strategic principle helps everyone realize what that means.

The strategic principle guides the company’s allocation of scarce resources—money, time, and talent. But it doesn’t merely aggregate a collection of objectives.  Rather, this simple statement captures the thinking required to build a sustainable futures that forces trade-offs among competing resources, tests the soundness of particular initiatives, and sets clear boundaries within which decision-makers must operate.

Creating and adhering to a concise, unforgettable, action phrase can help everyone keep morale high and direction clear as the race becomes more difficult and daunting. For example, Habitat for Humanity offers one of the most well-known strategic principles: Giving a hand up, not a hand out. This never changes, even when economic, social, and political forces around the organization do.

A well-thought-out strategic principle pinpoints the intersection of the organization’s passion, excellence, and unique contribution. As you can see, success lies at the intersection of the three.

Nonprofits Profit from a Strong Strategic Principle

If your organization operates in section one, you will probably experience some short-term success. People who can do work they feel passionate about and engage in work that rewards efforts with large monetary compensation or recognition can often stay in the game for the short run. But if you don’t offer your “customers” the best, they will choose other avenues for their contributions. In other words, no matter what your organization does, people expect and want you to do it well. Most nonprofits have competitors—other hospitals, universities, or charities—that offer similar kinds of services. But even if you have no “competitors,” you compete for donations, volunteers, talent, and other resources.

Passion and excellence without a unique contribution, or section two, won’t even allow you a short run. This undisciplined orientation—to do what you like and are good at—without consideration of the “market,” won’t provide anything other than some short-lived fun, which should last right up until the time your bills come.

Section three offers a recipe for burn out. You can work hard at something you’re good at and that brings you success, but you won’t excel at it for long unless you feel some passion for it.

Sustained success lies in area four, the intersection of passion, excellence, and unique contribution. Only here can your organization thrive as you work diligently to produce a product or service that others can’t match.

To think about your strategic principle differently, consider the world with your organization versus without it.  The difference defines your unique added value—what would be lost to the world if your organization disappeared. To discover this unique added value, ask yourself the following:

  • If we stopped doing what we’re doing, to whom would it matter?
  • Who would miss us most?
  • How long would it take another organization to step into the void?

The answers to these questions will help you understand and recognize the unique contribution your organization makes.

When organizations face change or turmoil, the strategic principle acts as a beacon that keeps the ships from running aground. It helps maintain consistency but gives leaders the freedom to make the right decisions and adjust direction for the organization. Even when the leadership changes, or the economic landscape shifts, the strategic principle remains the same.  It helps decision-makers know when to develop new practices, products, and markets.  When they face a choice, decision-makers will be able to test their options against the strategic principle by simply applying the three-part litmus tests:

  • Are we passionate about his work?
  • Can we do it better anyone else can?
  • Will it make us enough money to keep doing what we need to do?

When designed and executed well, a strategic principle gives people clear direction while inspiring them to be flexible and take risks. It offers a disciplined way to think about decisions, strategy, and execution and challenges people to play an ever-evolving better game.

“Strategic” is probably one of the most overused and misrepresented words in today’s organizations. Executives use it to denote anything they consider important, yet true strategy is limited to those situations that affect critical outcomes. Strategy identifies your unique contribution—something you can do that others cannot match. It defines the nature of your organization, impacts financial performance, and guides your choices. Done well, it allows you to go beyond surviving to thrive, no matter what changes the economy or other forces bring to the future.

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