Talent Management
Last Updated: May 25, 2021 | Read Time: 7 min
It’s a common experience: you want to build a company culture based on values and meaningful goals. If you can boost your performance management processes along the way, great. But you don’t know where to start and the terminology (core values, mission statements, vision statements and goal-setting methodologies) is confusing. What does it all mean?
Don’t worry—you’re not alone. At first, these concepts can seem to blur. But they are different. And what’s more, the differences matter. When you’re in the midst of strategic planning for the next year, you can’t afford to mix up what motivates the work with how you’re going to get there. This guide will help you align values, mission, vision and goals throughout your organization.
Mission Statement
This is what your company actually does. Keep it short and sweet, and easy to memorize. It’s tempting to use fancy words that sounds good but end up not meaning much. Your mission statement should be specific enough that people understand what you do and how you differ from your competitors. Consider these mission statements of well-known organizations:
- Public Broadcasting System (PBS): “To create content that educates, informs and inspires.”
- Google: “To organize the world’s information and make it universally accessible and useful.”
- Make-A-Wish: “We grant the wishes of children with life-threatening medical conditions to enrich the human experience with hope, strength and joy.”
Vision Statement
This is what your company aspires to be. In many cases, this will look very different from a company’s mission statement. A mission statement is what you do now, a vision statement is what you want to be doing tomorrow and in the future. When done right, your vision statement can and should drive decisions and goals in your company. Here are some great examples:
- Disney: “To make people happy”
- Ford: “To become the world’s leading Consumer Company for automotive products and services.”
- Avon: “To be the company that best understands and satisfies the product, service and self-fulfillment needs of women—globally.
Core Values
Mission and vision statements define where you’re going, but core values are all about what you are. What are the defining features of your company and how you operate? These values support your vision and shape your company culture. Try to limit your list of values to five or six. Beyond that, you’re going into too much detail and employees will struggle to remember all of them.
At Paycor, we know the following core values as our “guiding principles” and they help define how we act each and the decisions we make every day:
- Take Care of Customers First
- Take Care of Each Other
- Do the Right Thing
- Think Big, Dream Big
- Compete to Win
- Have Fun Along the Way
Goal Setting
Goal setting is how you take your mission, vision and core values and turn them into a reality. You can only produce results by producing clear objectives. There are lots of ways to do this, but companies are increasingly turning to the Objectives and Key Results (OKRs) methodology.
Objectives and Key Results (OKRs)
This works by first setting high level objectives, which align with your vision statement. However, while vision statements can be general, these objectives should be specific and measurable. Rather than aiming to “Have the best product ever” consider aiming to “Add two new developers”.
The next step is to set key results, which will be how you know if you achieved your objective. These should be measurable. Don’t write too many—two to four should be good enough. With the previous example of adding developers, key results could be to attend one hiring fair this quarter”, “create one blog post about hiring” and “Use LinkedIn to reach out to five potential candidates”. Suddenly, you’ve taken your broad vision and turned it into actionable steps to get there.
Goal-Setting Best Practices
An important part of setting OKRs is ensuring that they are transparent. This helps align your workforce to your company’s top priorities eliminating wasted hours spent on unproductive and non-impactful work. Your company is more likely to achieve the goals you set out every month/quarter/year and realize your vision.
Another pro-tip is that OKRs cannot be a top down process. You’ll only be able to create the right objectives for everyone by understanding the day-to-day reality of employees at all levels. You can only understand that reality by reaching out and including representatives from all parts of your company in conversations around strategic planning. This is win-win, as you’ll also get buy-in from employees who feel ownership over the process, rather than simply following orders from the executive team.
How Paycor Helps
Paycor creates HR software for leaders who want to make a difference. Our Human Capital Management (HCM) platform modernizes every aspect of people management, from the way you recruit, onboard and develop people, to the way you pay and retain them. But what really sets us apart is our focus on business leaders. For 30 years, we’ve been listening to and partnering with leaders, so we know what they need: HR technology that saves time, powerful analytics that provide actionable insights and dedicated support from HR experts.
Although the terms ‘vision’, ‘mission’ and ‘purpose’ are commonly found in strategic plans, there is sometimes confusion over what these terms mean, resulting in ineffective plans and poor execution.The increased stakeholder focus on sustainability and values, emphasises the importance of clarifying these key elements of your organisation’s strategic plan, before operational plans are developed.
This article explores the differences, explains why you need to take time to articulate each element and then looks at how they contribute to organisational success.
Vision
A vision statement describes what an organisation aspires be. It serves as a north star pointing to the future state. It also provides direction to everyone in the organisation as they focus their efforts on achieving the vision. It’s reported that during J.F Kennedy’s 1962 tour of NASA a janitor, when asked what he did for NASA, replied “I’m helping put a man on the moon.”1That organisational vision was realised in 1968.
Consider Nike’s vision statement which is ‘to remain the most authentic, connected, and distinctive brand.’ This gives employees and everyone associated with Nike, clear direction on where the company seeks to position itself within the world of sporting clothes and goods. For OzHarvest, a food rescue organisation, the vision is ‘Nourish our Nation.’2 The aspirational impact of both statements on staff and stakeholders is to galvanise them to commit to this shared future.
Mission
A mission statement describes what an organisation does and for whom. In addition, it can also state the benefit or benefits provided by the organisation. For Nike it is ‘to bring inspiration and innovation to every athlete in the world.’ By classing everyone as an athlete, they cast the net wide and aim to bring inspiration to every person who laces up a new shoe or dons a new pair of shorts. OzHarvest states that its mission is to ‘Fight food waste’. This three-word statement articulates exactly what they do. The 2021 Impact Report states that almost 9.5 million kgs of food was ‘rescued’ from land fill and redirected to produce 36 million meals.3
A clear mission helps direct operational plans. For example, if what you do is to provide the freshest seasonal flowers to your customers, this will guide your planning and purchasing, and your stock rotation protocols.
Purpose
Some strategic plans contain a purpose statement instead of a mission statement. Other plans may contain both a mission statement and a purpose statement. This can cause some confusion during strategy days and also for employees seeking to execute on the strategic plan. If you are starting with a blank sheet, planning your future strategy, it can be even harder not to confuse mission and purpose.
So, what is the difference between the two? Do you even need both?
A purpose statement provides the reason or reasons you exist. It is about why you exist, whereas the mission is about what you do and for whom. This distinction is often difficult to extract from strategic plans or corporate websites. For example, the OzHarvest Impact Report 2021 refers to four impact areas being Feed, Educate, Advocate and Innovate. This could be why they exist. Nike refers to the original goal of serving athletes and their website lists three areas of impact: ‘People, Planet and Play’ which informs their impact report.
The sharp focus on Environmental and Social Governance means stakeholders are demanding to know what your organisational purpose is so that they can judge if there is a values alignment. No articulated purpose is an opportunity missed to communicate with your stakeholders be they customers, suppliers, investors or staff. Further, a clear purpose on your organisational why can provide a compass, as the mission is executed.
Whether you chose to develop both a mission and a purpose will depend on the nature of your organisation and the activities you undertake. For example, the Australian Red Cross stated purpose is: ‘Bringing people and communities together in times of need and building on community strengths. We do this by mobilising the power of humanity.’ This is what they do. It could also be the why – that is to mobilise the power of humanity.
Where to now?
If you wish to review your strategic plan, add a new focus area (such as ESG) or start afresh, it’s important to clearly articulate your vision, mission and purpose. Seeking stakeholder input when developing these can help unearth new perspectives and encourage buy-in. Indeed, the same advice applies to any other strategic planning terms you might use and it is worth including a glossary in your plan, so the reader is in no doubt what each term means.
Effective Governance provides support to organisations developing their strategic plans. In fact, you could say our mission is to deliver the best governance solutions for every organisation.
Please contact us directly via our CEO Cate Jolley if you would like to talk about your vision, mission and purpose.