Blog Article

Would your mission statement pass the acid test?

Posted by Eric S. Pelletier

Eric S. Pelletier

When people are aligned, organizations prosper. “Alignment” is the first dimension of the Human Performance Equation, Hay Group’s new measure for identifying how well a workforce is performing. People at the world’s best companies are aligned – and it’s often reflected in their mission statements.

If your mission statement gets people excited, chances are you work for a well-aligned organization. Compare these three statements:

  • To organize the world’s information and make it universally accessible and useful.
  • To be Earth’s most customer centric company; to build a place where people can come to find and discover anything they might want to buy online.
  • To enable economic growth through infrastructure and energy development.

With these:

  • To maximize shareholder return by delivering premium products and services
  • To satisfy our customers’ desires for personal entertainment and information through total customer satisfaction
  • To add value to our stakeholders and markets

Which of these companies would you want to work for? I’d choose one of the first three, and not just because I know them to be prosperous, well respected companies. Each of these statements has meaning, purpose, and unique value. I’d know why I was going to the office every day. The next three statements, on the other hand, fail the mission statement “acid test”. They’re bland, generic, easy to replicate – and could apply to almost anyone.

Powerful mission statements reflect strong values: the “genome” of a company. This might be “dedication to every client’s success” (IBM), beautiful craftsmanship (Hermès) or in the case of private equity funds, a strong focus on free cash flow.

They are also a driver of alignment, which is the degree to which a company’s employees understand and work according to these values. Hay Group research into high-performing companies shows that these firms all feature strong alignment, particularly around culture and values. The clearer and more compelling your mission and values, the easier it is for people to line up behind them.

Yet alignment is notoriously hard to achieve. In average Fortune 500 companies, for example, research showed that an important layer of middle managers are very much not aligned:

HPE blog

(“Traction managers” are the layer of people below executive committee level who typically convert an organization’s strategy into action)

These numbers are a fair reflection of the cynicism that is often heard around watercoolers and coffee machines.

What can organizations do to get aligned? An important first step is to find whether you do in fact have a problem. Hay Group’s Organizational Culture Assessment is a useful tool for this, capturing a view of culture at three levels – individual values, group relationships and organization purpose – and clearly showing gaps between the current and desired states.

Re-focusing on core values is an essential part of the process. No company was ever founded on a desire to “optimize stakeholder satisfaction.” More likely it was something much more concrete and believable, for example “Create new materials that solve the world’s problems” or “Provide the most exciting driving experience”. When IBM saved itself from near-bankruptcy in the late 1990s, re-aligning employees around its founding customer-focused values was a critical part of the turnaround program.

What IBM and other successful turnarounds did was to create a “one shared story” of values that everyone can adhere to. Then, they spread the message using leaders and managers who are fully engaged with the change program, rather than briefly sponsoring it before returning to their corner offices.

So to see how your workforce is performing, start by looking at how aligned people are. And if no one understands your mission statement, it’s time to write a new one and use that opportunity to create a “one shared story”.

The next blog post in the Human Performance Equation series will look at the second dimension, Employee Effectiveness.

Human Performance Equation

 

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1 Comment

  1. Matt Gurin

    Matt Gurin

    May 22, 2015 at 1:38 pm

    great piece Eric!

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