Business Strategy
1 Leading Strategically :
1.1 Mission, Vision and values :
1.1.1 Mission :
A company’s mission is a brief statement about what is the company’s ultimate goals
and objectives are. It has the ability to shape the whole future of the company based
on the founders and early managers.
Not all companies have missions but when they do, it achieves three main purposes :
- It makes it completely transparent to all stakeholders and customers why the
company exists.
- Because of this common understanding it makes it more easy to work
together and solve disputes.
- Most of the people involved would feel like they are a part of something
bigger, which brings a sense of purpose and motivation.
What makes a good mission ?
A good mission statement should emphasize creation of customer or social
value, not being the best or simply making money.
It should be kept short, inspiring and memorable.
It should also be focused on important needs or problems, if a company
becomes product focused it will be surprised when new technologies will make
the product obsolete.
The mission should be lived and practiced inside the company.
1.1.2 The Vision :
A company’s vision is an aspirational statement about the future direction and impact
of the company.
Unlike a mission, companies may eventually
achieve or abandon their initial vision and move on to a new one.
Example Google’s vision : “ To provide access to the world’s information in one click”
1.1.3 Values :
Values of a company are a “ code of conduct “ for the company and its employees, it
essentially says to everyone, this is how we will behave as a company and as an
employee this is how we expect you to behave.
Example : Google’s ten core beliefs that founders wrote as they founded the
company.
Which contains statements such as #6 You can make money without doing
evil
1
, 1.1.4 The role of leadership :
One question we might ask ourselves is do the missions, vision and values have a
real impact on companies ? because we might say that formal statements say little
about what is followed in practice.
The answer depends on the leadership role, because leaders have a key
responsibility on weither the company’s own behavior will be accordingly to their
mission-vision-values or not.
Example ENRON company had in its values : Communication – Respect –
Integrity The company turned out to use a very excessive risk taking and
unethical behavior with a culture of greed and competition and thus went
bankrupt in 2001.
They can only be important for success if they are :
- Well designed
- Lived and practiced on everyday level
- Constantly communicated by leaders
- They are a true reflection of the company
Making a company’s mission is art, it should be crafted in a way to make it big
enough that it gets people excited but also achievable enough that people know
what they role in achieving it would be.
1.2 Business models :
Why should we care about a business model ?
Many businesses went bankrupt but they seemed to be doing well, well handled and
with no competition.
An example would be a store called Blockbuster in USA that was operating in video
rentals, it went bankrupt but not because another video rental company took its
place but because new companies figured other ways to satisfty the customer needs
that they were satisfying but in a different and easier way. ( Netflix for example )
Netflix is better business model for meeting the same needs of customers to enjoy
watching videos.
It is important to know that a successful idea, planning, execution is not all it takes to
make a successful company, if the business model is not perfect for what we do
failure is very likely to happen.
1.2.1 The V.A.R.S Framework :
It consists of 4 main interrelated elements to make a business model.
- V : Value proposition delivered by the business model
- A : Activities – Resources – Capabilities needed
2
1 Leading Strategically :
1.1 Mission, Vision and values :
1.1.1 Mission :
A company’s mission is a brief statement about what is the company’s ultimate goals
and objectives are. It has the ability to shape the whole future of the company based
on the founders and early managers.
Not all companies have missions but when they do, it achieves three main purposes :
- It makes it completely transparent to all stakeholders and customers why the
company exists.
- Because of this common understanding it makes it more easy to work
together and solve disputes.
- Most of the people involved would feel like they are a part of something
bigger, which brings a sense of purpose and motivation.
What makes a good mission ?
A good mission statement should emphasize creation of customer or social
value, not being the best or simply making money.
It should be kept short, inspiring and memorable.
It should also be focused on important needs or problems, if a company
becomes product focused it will be surprised when new technologies will make
the product obsolete.
The mission should be lived and practiced inside the company.
1.1.2 The Vision :
A company’s vision is an aspirational statement about the future direction and impact
of the company.
Unlike a mission, companies may eventually
achieve or abandon their initial vision and move on to a new one.
Example Google’s vision : “ To provide access to the world’s information in one click”
1.1.3 Values :
Values of a company are a “ code of conduct “ for the company and its employees, it
essentially says to everyone, this is how we will behave as a company and as an
employee this is how we expect you to behave.
Example : Google’s ten core beliefs that founders wrote as they founded the
company.
Which contains statements such as #6 You can make money without doing
evil
1
, 1.1.4 The role of leadership :
One question we might ask ourselves is do the missions, vision and values have a
real impact on companies ? because we might say that formal statements say little
about what is followed in practice.
The answer depends on the leadership role, because leaders have a key
responsibility on weither the company’s own behavior will be accordingly to their
mission-vision-values or not.
Example ENRON company had in its values : Communication – Respect –
Integrity The company turned out to use a very excessive risk taking and
unethical behavior with a culture of greed and competition and thus went
bankrupt in 2001.
They can only be important for success if they are :
- Well designed
- Lived and practiced on everyday level
- Constantly communicated by leaders
- They are a true reflection of the company
Making a company’s mission is art, it should be crafted in a way to make it big
enough that it gets people excited but also achievable enough that people know
what they role in achieving it would be.
1.2 Business models :
Why should we care about a business model ?
Many businesses went bankrupt but they seemed to be doing well, well handled and
with no competition.
An example would be a store called Blockbuster in USA that was operating in video
rentals, it went bankrupt but not because another video rental company took its
place but because new companies figured other ways to satisfty the customer needs
that they were satisfying but in a different and easier way. ( Netflix for example )
Netflix is better business model for meeting the same needs of customers to enjoy
watching videos.
It is important to know that a successful idea, planning, execution is not all it takes to
make a successful company, if the business model is not perfect for what we do
failure is very likely to happen.
1.2.1 The V.A.R.S Framework :
It consists of 4 main interrelated elements to make a business model.
- V : Value proposition delivered by the business model
- A : Activities – Resources – Capabilities needed
2
