How important is a mission statement?

Dear Aunty B,

I am very confused. Our company, which has 32 employees, has just released its mission statement, which is to be a “tier one player”.

The mission statement is the culmination of four months work and is meant to set out our direction for the next five years. But it is rubbish! There is no way we can be a tier one firm. The tier one firms in our sector are global, have thousands of people and operate completely differently.

Should I just ignore it? How important is a mission statement?

Confused,
Sydney

Dear Confused,

Well, in this case the mission statement doesn’t matter a hoot because it is unachievable. The more important question to ask is what is the vision for the business?

The single most important thing you must do when starting or growing a business is to at all times have a clear vision on what your position is in the marketplace. You must know what problem you are solving and why you can solve it. You must understand your marketplace and understand your customers. I am afraid that a glib statement about being a tier one player does none of that.

The danger of course, is that you start to act like a tier one player and therefore lose focus on your niche. Then decision-making becomes confused and you chase after clients that you won’t have a chance of getting. The more market places you try and operate in as a tier one player, the more likely you are to fail, as you will waste resources on chasing opportunities, make mistakes because you don’t know the customer inside out and you will also miss opportunities.

If I were you I would not ignore it. Ask for more direction on strategy.

What does that mean? How can it be executed? How can you compete with tier one firms when you are only a medium-sized business?

Good luck!
Your Aunty B

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