Elements of Enterneering®/Organisation/Philosophy
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Companies must be able to link the essential components of corporate culture to a description of the company's future path and goals. These core elements are key for strategy development and critical as a central, overarching guiding principle for the management and long-term direction of the company. This may sound quite pompous and theoretical, but these can nevertheless be intelligently defined in practice in accordance with the size or complexity of the company. This is because, at its core, it is about setting down in writing why a company exists, what benefits it provides, how it should develop and grow and what the character of the organisation should become in the process. The corporate philosophy, which describes the company’s vision, mission and goals, is the basis for this. Beware, however: once this is committed to in writing, next comes the implementation, which requires consistency and fresh commitment!
As part of the corporate philosophy, these core elements are initially formulated as clearly and simply as possible to ensure that they are optimally understood and anchored in the minds of the people working in and with the company. Also, it is important that the impact period or observation horizon be set far enough into the future to allow enough time for realistic implementation plans, adaptations and working out of the details, rather than just constantly defining new mission statements.
The most essential elements of the corporate philosophy are:
- corporate vision,
- corporate mission,
- corporate strategic goals,
- corporate values, according to which the company and its employees act,
- and corporate guidelines and rules.
THE COMPANY AND ITS VISION
No successful company exists solely for the joy of being. Successful companies do not fulfil an end in themselves but create added value for the market. Formulation of the corporate vision poses the central question: 'What added value does the company offer its customers?' Many entrepreneurs would respond that they can precisely state the added value their companies create. But, when asked whether the other employees in the company would say the same thing, and whether the customers would confirm this, some entrepreneurs will probably be able to give only an evasive or a somewhat generalised answer. And, when it comes to the question of whether internal action or resource and implementation planning are comprehensibly, bindingly and measurably linked to the creation and maintenance of this added value, at least as many entrepreneurs will have trouble coming up with a response.
The corporate vision is the positively formulated concept for the type of future conditions (added value) the company wants to create. The vision thus sets the direction for corporate development – it must be inspiring and motivating. It is important to formulate the vision as clearly, concisely and comprehensibly as possible. Avoid wordy content that is not customer-specific. The best-formulated visions developed by successful companies are short, simple, and smart.
The corporate vision is the starting point for all other corporate strategic elements. In some companies, the importance and impact of an effective vision that lays the groundwork for all further activities and actions of the company is underestimated. Insufficient attention is devoted to this; the timeframe is shortened, and an inconsistent approach is taken to anchoring the vision in reality. Experience shows that this often backfires, with employee motivation and performance falling short of expectations and valuable resources being directed to the wrong activities.
Examples of effective corporate vision statements
| ✓ | Wikipedia: Imagine a world in which every single person on the planet is given free access to the sum of all human knowledge. |
| ✓ | Microsoft: A computer on every desk, and in every home. |
| ✓ | Disney: Making people happy. |
| ✓ | Facebook: To give people the power to build community and bring the world closer together. |
| ✓ | TED: Spread ideas. |
| ✓ | IKEA: To create a better everyday life for the many people. |
Examples of less effective corporate vision statements
| ✗ | To be the most successful software developer in the world, providing the best code experience in our target markets. |
| ✗ | Within the next five years, we will have achieved more than 25% market share. |
| ✗ | Selling consumer goods to price-conscious consumers in a fast, friendly way. |
| ✗ | To grow twice as fast as our competitors while making at least the same profit. |
THE COMPANY AND ITS MISSION
Mission or vision? They sound so similar. And this has now become too much of a theoretical exercise. Or has it?
Perhaps it will help you understand this better if you imagine trying to follow assembly instructions for a piece of furniture in which some of the introductory steps and explanations have been omitted because, in the manufacturer’s opinion, they seem self-explanatory or superfluous. You may have experienced this yourself – on the basis of such unclear instructions, you end up assembling and disassembling an item multiple times and, in the worst case, are left with several miscellaneous unused components in the end. The effect could be similar if a company with no corporate vision, mission or both launches directly into the implementation of strategic target and action planning. If you do not want to risk disgruntled customers leaving negative reviews, you have to devote sufficient time to this.
It is the same with vision and mission. While the corporate vision is the concept for what a company wants to achieve in the future (= description of the state of the company), the mission is a formulation of the organisation’s main purpose and focus. Typically, it remains unchanged over time and embodies the company’s primary undertaking or business purpose, as well as its commitment to certain values.
Examples of effective mission statements from the companies mentioned earlier
| ✓ | Microsoft: Our mission is to empower every person and every organisation on the planet to achieve more. |
| ✓ | Disney: Our mission is 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. |
| ✓ | IKEA: Our business idea supports this vision by offering a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. |
| Note on practical application |