We often talk with companies who are waiting to work on their strategy because they are reworking their mission and vision statements. There are key differences between mission, vision and strategy and it is essential they all fit together to drive impact. Successful companies connect these three pieces together to ensure their business focus is clear, communicated and market driven. But strategy is too important to be put on hold while you search for the perfect mission and vision.
Employees and customers can be genuinely inspired if their organization has a clear, worthwhile mission and a compelling vision. The key is knowing the difference between these statements and a strategy. A mission statement should provide purpose to the entire team, defining what makes your business important. A well-articulated vision statement will inspire your team and customers to a future state of impact. Typically, the founder or executive leadership team is responsible for describing this future state. This aspirational view should open the door for employees to feel purpose at work and customers to want to work with you, however it does not substitute for a strategy.
A market-back strategy doesn’t start with aspirations or quantifiable goals. Rather it starts with understanding customer value and then on identifying differentiation or potential differentiation that allows your company to deliver customer value and so drive growth in your business. Strategy is a clearly articulated view of the distinctive capabilities that allow you to win in the relevant markets and presents a framework for management decision making that creates outcomes that are more than the sum of marginal decisions. Strategy has to be more than ‘everyone try harder’ – it is the roadmap for what you will do and what you will not do, helping the organization focus its resources and maximize their return. A well-defined strategy can have enormous impact on your business with or without mission and vision statements, it isn’t something you should ever push to the side or delay.
We call the intersections of what customers should want and what you are uniquely able to provide, your “sweet spots”. When you focus business decisions on your sweet spots, you can drive growth, ensure you don’t become a commodity and keep your team focused on value verses fluff. Articulating value from the customers’ perspective is critical, as what customers pay for is actual improvement in their business, not marketing spin. Customer value is always: customer specific, measured in currency, and relative to their next best alternative. Thinking your mission and vision statements create value by themselves is a dangerous trap.
Our advice: Make sure you don’t put your strategy on hold while updating your vision and mission statements. To drive results, focus on working these core components of your strategy to set you and your company up for success.
- Understand the Momentum of the Business: Have a clear and objective understanding of your business and how you got there. Was it a well-defined plan or was luck involved? How is the current state going to impact the business in the coming years? Without a good understanding of the forces that got us here, you are unlikely to figure out how to change the path.
- Define your Sweet Spots: Your sweet spots are found at the intersection of what the customer should want and what you are uniquely qualified to provide. Having a clear understanding of under-met needs combined with the core competencies you are ready to provide creates clarity on where you should focus your limited resources. This is grounded in being able to think objectively from the customer’s perspective, not biased by our hopes or ambitions.
- Identify your target market segments: Find groups of customers with similar underlying needs and define your value proposition. Our detailed blog on “Market Segmentation: How to Get it Right” outlines a few things to keep in mind as you work as you work through this critical task.
- Become a student of your customer: Good VOC is not a customer satisfaction survey, rather it is the ability to genuinely put yourself in their shoes and understand how they make decisions – this is the only way to uncover unmet needs.
- Execute, Review and Refine: A well done market back strategy has a clear plan to execute but also reviews client feedback and refines as necessary. This includes defining up front the measures you will use to track the strategy. This is critical to distinguishing problems with execution from problems in the underlying strategic thinking and it ensures that you can keep your market back strategy current as markets and competitors change.
Once completed you can ensure your market back strategy (strategies) are in line with the future state articulated in your vision statement and is in support of your mission statement. Strategy work should never be put on hold and can be done before or in parallel to the development of your mission and vision statements.