Department of Management Studies

MBA SEMESTER III

Course Title: Strategic Management
Course Code: MBA 301

Envisioning and Mission

:Prof. (Dr.) Neeraj Sharma

{(Ph.D (IIT Roorkee) ; PGDM(IIM Shillong); NET(UGC); JAIIB & CAIIB (IIBF);BE(Dr. B.R. Ambedkar University)}

Department of Management Studies

Graphic Era (Deemed to be University), Dehradun
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 Learning Objectives
• Explain the concepts of strategic intent, stretch, leverage, and fit
• Describe and exemplify the concept of vision
• Describe and exemplify the concept of mission
• Explain the three dimensions of business definition
• Evaluate quality of vision, mission statements, and business
definitions
• Describe business model and their relationship with strategy
• Describe the role and characteristics of objectives
• Explain the process of objective setting
• Distinguish between well-formulated and badly-stated
objectives
• Discuss the role of critical success factors in setting objectives

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 Strategic Intent

• Strategic intent is an obsession with an

organisation: an obsession by having
ambitions that may even be out of proportion
to their resources and capabilities. This
obsession is to win at all levels of the
organisation while sustaining that obsession in
the quest for global leadership.

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 Concept of stretch, leverage and fit
• Stretch is "a misfit between resources and
aspirations"
• Leverage refers to concentrating,
accumulating, complementing, conserving,
and recovering resources in such a manner
that meagre resource base is stretched to
meet the aspirations that an organisation
dares to have.
• Fit means positioning the firm by matching its
organisational resources to its environment.
G. Hamel and C. K. Prahalad: "Strategy as Stretch and Leverage" Harvard Business Review, Mar - April 1993, pp. 75 - 84.

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 Vision
• Kotter (1990) defines it as a "description of something (an
organization, a corporate culture, a business, a technology, an
activity) in the future".

• El-Namaki (1992) considers it as a "mental perception of the

kind of environment an individual, or an organization, aspires to
create within a broad time horizon and the underlying
conditions for the actualization of this perception".

• Miller and Dess (1996) view it simply as the "category of

intentions that are broad, all-inclusive, and forward thinking".
J. Kotter, A Force for Change: How Leadership Differs from Management (London: Free Press, 1990); M. S. S. El-
Namaki, "Creating a corporate vision" Long Range Planning, Vol. 25, No. 6, (1992), pp. 25 – 29; A. Miller and G.
G. Dess, Strategic Management (2nd. ed.) (New York: McGraw-Hill, 1996), p. 6.

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 Nature of Vision
A vision should be A vision should not be
A organizational charter of core A ‘high concept’ statement , motto
values and principles or literature or an advertising
slogan
The ultimate source of priorities, A strategy or plan and a view from
plans, and goals the top
A puller (not pusher) into the future A history of proud past
A determination and publication of A ‘soft’ business issue
what makes a person unique
A declaration of independence Passionless
Source: Adapted from Lucas, J.R. Anatomy of a vision statement
Management Review, 87, no. 2 (1998): 22-26
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 Vision of Graphic Era(Deemed to be University)
Dehradun

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 Vision of Facebook

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 Core ideology and envisioned future
• The core ideology defines the enduring
character of an organisation that remains
unchangeable as it passes through the
vicissitudes of vectors such as technology,
competition or management fads.

• The envisioned future too consists of two

components: a 10 - to - 30 years audacious
goal and vivid description of what it will be
like to achieve that goal.
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 The Process of Envisioning

Well-conceived vision

Core ideology Envisioned future

Core values Long-term audacious goals

Core purpose Vivid description of
achievement

Source: J. Parikh and F. Neubauer : Corporate Visioning

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 The Benefits of having a Vision
• Good visions are inspiring and exhilarating.
• Vision represent a discontinuity, a step function, and a
jump ahead so that the company knows what it is to be.
• Good visions help in the creation of a common identity and
a shared sense of purpose.
• Good visions are competitive, original, and unique. They
make sense in the marketplace as they are practical.
• Good vision fosters risk taking and experimentation.
• Good vision fosters long-term thinking.
• Good visions represent integrity- they are truly genuine and
can be used to the benefit of people.

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 Mission
• Thompson (1997) defines mission as the
"essential purpose of the organization,
concerning particularly why it is in existence,
the nature of the business(es) it is in, and the
customers it seeks to serve and satisfy".

• Hunger and Wheelen (1999) say that mission

is the "purpose or reason for the
organization's existence".
J. L. Thompson: Strategic Management: Awareness and Change, (3rd ed.) (London: International Thomson
Business Press) 1997, p.6; J. D. Hunger & T. L. Wheelen: Strategic Management, (Reading, Mass.: Addison
Wesley Longman), 1999, p. 10.

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 Characteristics of mission statements
• It should be feasible
• It should be precise
• It should be clear
• It should be motivating
• It should be distinctive
• It should include major components of
strategy
• It should indicate how objectives are to be
accomplished
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 Abells’ three dimensions for defining a
business of a watch company
Customer functions:
Utility / ornamental

Alternative technologies:
Mechanical / quartz
technology

Customer groups:
children, men or
women
Based on: D.F. Abell: Defining the Business: The Starting Point of Strategic Planning
Englewood Cliffs, N.J. Prentice-Hall, 1980
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 Business model

• Business model could be defined as “a

representation of a firm's underlying core
logic and strategic choices for creating and
capturing value within a value network.”

Shafer, Scott M. & Smith, H. Jeff & Linder, Jane C., 2005. "The power of business
models," Business Horizons, Elsevier, vol. 48(3), pages 199-207

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 Goals and objectives

• Goals denote what an organisation hopes to

accomplish in a future period of time. They
represent the future state or outcome of
effort put in now.

• Objectives are the ends that state specifically

how the goals shall be achieved. They are
concrete and specific in contrast to goals that
are generalised.
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 Role of objectives

• Objectives define the organisation's

relationship with its environment
• Objectives help an organisation pursue its
vision and mission
• Objectives provide the basis for strategic
decision-making
• Objectives provide the standards for
performance appraisal

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 Characteristics of objectives

• Objectives should be understandable

• Objectives should be concrete and specific
• Objectives should be related to a time frame
• Objectives should be measurable and
controllable
• Objectives should be challenging
• Different objectives should correlate with each
other
• Objectives should be set within constraints
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 Issues in objective setting

• Specificity
• Multiplicity
• Periodicity
• Verifiability
• Reality
• Quality

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 Factors for objective setting

• The forces in the environment

• Realities of enterprise' resources and internal
power relationships
• The value system of the top executive
• Awareness by the management

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 The balanced scorecard model
How do we look to shareholders?

Financial Perspective

Objectives Targets

Customer Perspective Internal Process Perspective

Vision & Strategy
Objectives Targets Objectives Targets

Learning / Innovation Perspective

Objectives Targets

Based on R.S. Kaplan & D.P. Norton: The Strategy-focused orientation: How Balanced Scorecard
Companies Thrive in the New Business Environment Boston: Harvard Business School Publishing, 2000
and R.S. Kaplan & D. P. Norton: The Balanced Scorecard: Translating Strategies into Action Boston:
Harvard Business School Press, 1996.

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 Critical success factors and key
performance indicators
• Critical success factors are crucial for
organisational success. When strategists
consciously look for such factors and take
them into consideration for strategic
management, they are likely to be more
successful, putting in relatively less efforts.

• Key performance indicators are the metrics or

measures in terms of which the critical
success factors are evaluated.
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 Thanks….

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EIBP 23