Mission Statement is important because it explains the existence, objectives, and goals of our business. A mission statement is crucial for any organization so as to understand its business purpose very clearly and well identified so as to achieve the advantage, profitability, and growth.
Nine Components of a Mission Statement1. Customers- Who are the firm's customers? Analyzing the customer and serving them.
2. Market- Size of a market, Segmentation of markets.
3. Technology- Do the firm have advancement in technology? Is the firm using innovative technology?
4. Philosophy- Firm's policies, beliefs, attitudes, values.
5. Concern for growth and profitability- Is the firm has a chance to grow and earn a profit? How growth and profitability are to be achieved?
6. Concern for the public image- Is the firm concerned for social responsibility?
7. Concern for employees- Is the firm takes employees as their valuable asset to the firm?
8. Geography- Firm's geographical expansion and location.
9. Products and services- What types of products and services the firm is providing? Is the product differentiated and unique? Is the product/service demanded?
When preparing an effective strategic plan, the firm first figures out the well-thought mission statement. A strategic plan can achieve its objective only when it has clear mission statements which include the above nine components that help the firm to understand its business and make plans accordingly.
When a mission statement is well thought out, it helps the firm to get guidance and direction to its goal and objectives and can implement plans and policies accordingly.
Mission Statements including nine components help an organization to know its customers, products, and services, market, geography, technology, its concern for profitability and growth, its concern for public image, and its concern for its employees. It can make plans so that it can achieve its mission and succeed.
It helps to examine and control the path when the organization gets distracted from its path or unclear where to go and what the business is all about? When preparing an effective strategic plan the mission statement shows the organization where to head and how to achieve goals and success. The strategic plan is a 'game plan' whereas mission is the 'goal post'.
Therefore, mission statements and its components are very essential while preparing an effective strategic plan.