Should For-Profit Companies Have a Mission Statement?

As a mission-driven company, of course you have a mission statement, right? But does it have a purpose? And do for-profit companies, socially conscious or not, need a mission statement to achieve their goals? Many argue no.

While a majority of companies do have some form of mission statement in place, Chris K. Bart, professor of strategy and governance at McMaster University told The New York Times only 10 percent of mission statements say something meaningful. “Most mission statements aren’t worth the paper they are written on. That’s the sad reality.”

Only 10 percent of mission statements actually say something meaningful. Does yours? Click To Tweet

A good mission statement pays dividends

While I agree that most mission statements fall flat, a good one can go a long way in helping you advance your bottom line goals. Gallup conducted a global analysis and discovered margin and mission are not at odds with one another, “In fact, the opposite is true. As employees move beyond the basics of employee engagement and view their contribution to the organization more broadly, they are more likely to stay, take proactive steps to create a safe environment, have higher productivity, and connect with customers to the benefit of the organization.”

Mission is important to customers, too; it sets expectations about what it means to work with you or purchase your product. And, as a social enterprise company, your mission can also demonstrate your impact and build awareness among the 91 percent of global consumers who say they’re likely to switch to brands associated with a good cause.

All that said, in order to be effective, your mission statement needs to be about more than just words on a page. So how do you craft a mission statement that incites action and helps you meet your goals? A mission statement that’s one of the 10 percent helps your company not just say but do something more meaningful.

Involve your key stakeholders in the mission creation process

The only way your mission statement is going to be effective is if it’s resonant among your organization’s key stakeholders. That’s why many organizations choose to involve individuals who play a key role in the success of their organization in the mission development process.

You can start by asking your various stakeholders what draws them to your company. Why do they choose to work or do business with your organization over others? What would the world look like if your company ceased to exist? You can also ask people to draft their own version of your mission statement, allowing you to gain a variety of inputs as you work toward building your final statement.

Make your mission concise and memorable

At Prosper, we’ve worked with dozens of organizations to revisit existing mission statements or to create new ones. The two major challenges we see time and time again: organizations try to say too much and end up with a superfluous statement that conveys nothing at all, or they write a statement that doesn’t encompass enough. Take Microsoft as an example:

Our mission is to empower every person and every organization on the planet to achieve more.

In looking at numerous corporate mission statements like this one, it’s clear exactly what Bart means when he says only 10 percent of them are effective. If anything, this is Microsoft’s vision statement; the world the company hopes to create by meeting all of its goals.

A good mission statement takes an audacious vision and explains how your organization will work to bring it to reality. It’s short, sharply focused and memorable, so it’s easy to apply and measure against.

A good mission statement is short, sharply focused and memorable. Click To Tweet

Many nonprofits do this so much better than corporations. Take Feeding America as an example. The organization’s vision is A hunger-free America. This vision is inspiring and motivating; if Feeding America meets all of its goals, no one in the U.S. will be hungry. How will they accomplish this vision? Their mission statement spells it out:

Our mission is to feed America’s hungry through a nationwide network of member food banks and engage our country in the fight to end hunger.

Take note that Feeding America’s vision is very lofty, while its mission grounds the organization in the reality of its day-to-day work.

Establish your mission as a benchmark for decision making

Your mission should be your guide for organization-wide decision making: when to hire, fire, build, grow or roll back. Look at Patagonia as a good example of a company doing this well. The outdoor clothing company’s mission is to:

Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.

To meet this mission, Patagonia switched to organic cotton more than 20 years ago (organic cotton still only makes up less than 1% of all cotton produced today), which meant re-evaluating the company’s supply chain, establishing new partnerships and putting profits at risk to make it happen. This is just one example of the company’s mission-forward approach.

Patagonia consistently donates time, services and at least one percent of sales to hundreds of grassroots environmental groups all over the world. On Black Friday 2016, Patagonia donated 100 percent of sales to grassroots organizations. The company was expected to achieve $2 million in sales that day, and instead achieved $10 million. With its mission-first mentality, Patagonia enjoys annual revenue of $600 million.

While Patagonia might be considered a radical example, it’s clear to see how the company uses its mission as a benchmark when it comes to how the business is run, the materials it uses and its commitment to making the world a better place. When developing your company’s mission statement, think of how you will put it into action, from the way it will be used to onboard new employees and conduct performance reviews to how your leadership will use it to advance your business goals.

Leave room for the future

While your mission statement serves as your company’s guide and decision-making framework today, it also needs to consider what your organization will look like in the future. Steer clear of mentioning specific products or services that may not ever actually exist in the future and leave room for your organization to grow into your mission.

Notice, Google’s mission is to organize the world’s information and make it universally accessible and useful. There’s no mention of specific Google products. The statement explains exactly what Google does, while remaining agnostic to future technological advancements. While this is particularly important for technology organizations, if you want to create a mission statement that stands the test of time, you need to consider what the world may look like in 5, 10 or 20 years.

Communicate with impact - a guide for social enterprise leadersDo you need help developing a meaningful mission statement for your social enterprise?  Our ebook, Communicate With Impact: A Crash Course in Building a Results-Driven Marketing Program for Your Changemaking Organization can provide the actionable insights you need to develop or redevelop your mission-driven company’s mission statement to guide all of your marketing and communications.

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Thinking about your mission statement in relation to charting your company’s future? Share your mission statement and thoughts below, and let’s discuss!

About
Lindsay Mullen is co-founder and CEO of Prosper Strategies where she works with changemaking companies that want to use marketing as a force to drive more revenue and as a result, make a greater positive impact.
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