Purpose, Mission, Vision: Why On Earth Are You in Business?
by Matt, on 12 Nov 2019
Please don’t spiral into an existential crisis, but does the answer trip off your tongue as easily as your well-rehearsed sales pitch?
Most business leaders can rattle off the features that their product or solution offers. Some can even describe how that translates into value for their customers. However, despite popular books and TED Talks imploring them to do so, very few leaders take the time to distill out why their company exists.
In this edition of SPT, we’ll discuss how developing clarity of purpose, mission, and vision helps set you and your business up for success.
The importance of a solid foundation
Living in Houston, which is basically built on a swamp, you quickly learn the importance of a good foundation to the long-term stability of your house. Older properties exhibit the veined walls and crooked lines of sinking piers and cracked slabs, the remediation of which is a cottage industry unto itself.
Casting yourself as the architect and general contractor, how would this impact your strategy when building a new property? Although you might be thinking ahead to the desired size and shape of building to be constructed, your primary concerns would be confirming a suitable site on which to build and laying down some solid foundations.
So why don’t we automatically do the same thing when building a business?
You’d fire a builder who started framing up the house without first leveling the ground, digging out the footings, and pouring some concrete.
The most widely used terms when talking about business foundations are purpose, mission, and vision. They’re used to answer questions beginning with why, how, what, and when. And, oh yes, we call ourselves founders of the business!
That being said, regardless of the maturity of your business, if you, as a business leader don't have these in place, we highly recommend setting aside the time to work on them now.
START WITH WHY
With a hat tip to the seminal book of the same name by Simon Sinek, whose related TED Talk “How great leaders inspire action” has attracted over 11 million views, we posit that every business – and every business leader – should begin by defining why they do what they do (rather than what or how).
Understanding your purpose helps explain – to yourself and to others – why you will go out of your way, sometimes under duress and often at the expense of sleep, relationships, and hair, to pursue your dream. It’s the mother of all motivators that keeps your engine running and allows you to recruit others to the cause.
Business textbooks will, of course, provide the dry answer that the primary purpose of any business is to maximize profits for its owners/shareholders (or something along those lines), preferably while maintaining its corporate social responsibility.
But that is unlikely to motivate an exhausted leader out of bed at 5am or tempt a future employee into foregoing their comfortable corporate lifestyle to join a rag-tag startup. A true purpose should provide intrinsic motivation. It should satisfy you from within. Or, more importantly, leave you dissatisfied within if you haven’t given everything in its pursuit.
Purpose statements should be simple and powerful. An essay isn’t the answer.
Consider: “To offer designer eyewear at a revolutionary price, while leading the way for socially conscious businesses” (Warby Parker), “To create a better everyday life for the many people” (IKEA), or “To give customers the most compelling shopping experience possible” (Nordstrom).
You’ll notice that these aren’t goals with a defined end point. They’re journeys without an end in sight. Can you see how each might motivate the company’s leaders and employees to go the extra mile?
Take a moment to reflect on what purpose your business serves and how you might encapsulate it in a single sentence.
MUST EVERYTHING HAVE A PURPOSE?
Struggling to find a purpose behind what you’re doing means one of two things: either you haven’t yet found the right words, or you aren’t doing something that provides intrinsic motivation.
Identifying and capturing the purpose behind your endeavors isn’t always straightforward. It can require periods of quiet reflection to identify what it is about the work you’re doing that sets your hair on fire.
Could you start and grow a business that doesn’t serve a purpose? Perhaps, but the lure of more purposeful endeavors, those that do provide intrinsic motivation, will always be nagging at you and anyone that is persuaded to work at the company.
Plus, from the many startups that we've mentored and worked with over the years, the companies that don't take the time to do this are more likely to fail. Maybe that will convince you!
If, after some legit reflection time, you still can’t write a purpose statement that inspires you, ask for help from the people who know your business well. What is it about you and your company that inspires them? What do they see you doing that’s more important than any money you might make doing it?
The popularity of mission statements has risen and fallen throughout my career. At one point, every company had theirs framed in the lobby for all to see. It didn’t matter how good or bad it was, it just had to be there.
There’s also widespread confusion about the difference between purpose and mission. Some organizations prefer one over the other, while others confuse them completely.
Here’s how we differentiate them:
- A purpose is why the organization was started and provides some deeply held belief that inspires its employees to make a difference. It often has no obvious end point. Purpose guides you and your team. It could be just as relevant 200 years from now as today.
- The mission explains how the organization will get to its destination – the unique path it will follow and the decisions it will make to get from one point to another. The mission directs you and helps you make tactical decisions.
- And, while we’re at it, the company’s vision statement should describe the destination – your goal and what you expect to find when you get there. The vision keeps you on course and helps you see how far you’ve traveled.
A good mission statement explains how you pursue your purpose and who that impacts.
Whereas your purpose may never change throughout the life of the company, the mission statement might evolve as the business grows. Since it describes what business the organization is in – and what it isn’t – the addition of new products, services, and markets will eventually justify a re-write.
WHAT IS NEITHER WHY NOR HOW
Exactly what you do to complete the mission is another story. Tactical choices and operational activities will vary in response to market dynamics, customer preferences, and your own company evolution.
While the purpose provides an enduring answer to why and the mission statement describes how you seek to achieve that purpose, a short-term business plan is usually the place to capture what you will do to complete the mission.
The military uses a handy concept known as “commander’s intent”. This describes the mission without being overly prescriptive as to what tactics should be applied, allowing front line troops to pursue whichever course of action seems most appropriate considering the real-time situation they are facing.
Depending on the predictability of your business, a short-term plan might be something you update once a month, every week, or even one or more times each day. Defined time periods, such as a sprint within the Agile methodology, might determine the planning cadence that you choose to follow.
VISION (YOU’RE NOT DREAMING)
We already mentioned that your vision statement should describe the destination and what you expect to find when you get there. It provides a concrete way for stakeholders, especially employees, to visualize the meaning and purpose of your business.
Notice that we used the word concrete. Don’t mistake crafting a vision statement for scribbling down your dreams on a notepad. You should articulate the vision using clear, measurable terms that people involved in and with the business can recognize.
For an early-stage business, we recommend projecting a relatively short time into the future – generally three to five years. A more established and likely slower-moving business might choose a five to ten-year horizon.
Describe what success looks like in your operations. Review your long-term goals and describe what the world will look like if you achieve them. What will you have delivered? How will the team recount their most memorable experiences? Who will your work have impacted, and in what way?
We like to use a rubber band as an analogy for creative tension. One end is secured by your understanding of current reality. The other end is attached to your vision.
Adjusting the separation between your vision and current reality stretches the band and generates creative tension, which can be harnessed to propel the team forwards.
If your vision is too easily achieved – i.e. not far enough removed from current reality – the rubber band will be slack and provide no impulse for movement.
If your vision is too far from current reality – i.e. hard for anyone to believe it can be achieved – the rubber band will become over-stretched and break. A broken rubber band also cannot propel you forwards.
Write your vision statement such that it seems difficult but not impossible to achieve and you will generate the optimum amount of creative tension to motivate and drive your team.
BUILDING ON THE FOUNDATIONS
Having invested the time to deliberate and refine your purpose, mission, and vision statements, don’t let them go to waste! Too many companies add them to their website (and, yes, display them on an office wall) and then forget all about them.
Your purpose, mission, and vision should be purposeful statements that guide decision making throughout the organization.
Reference them often, especially when you encounter indecision. If something is aligned with the company’s purpose and mission, it’s probably the right thing to do.
Include them in your employee handbook and review them with job candidates and newly hired staff. Remind your team of them during all-hands meetings and individual check-ins.
Finally, returning to our home building analogy, put yourself in the role of inspector. Make sure that whatever is getting built is aligned with the foundations you have laid. If something isn’t right, stop the work and investigate further.
People, processes, and products that aren’t aligned with the company’s purpose, mission, or vision are a drain on resources and should be removed.
- Reflect on why you want to pursue this business and then draft or review your purpose statement to encapsulate that intrinsic motivation.
- Draft or review your mission statement to describe the path your company will take in pursuit of its purpose. Explain what you do, and for whom.
- Write or review your vision statement to describe what the destination will look like. Try to capture what you will have delivered, who you will have impacted, and in what way.
- Check that others see your vision statement as challenging but achievable so that it produces the right amount of creative tension when seen in context with your company’s current reality.
- Read our Guide on Getting Started.