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Strategic Vision: Three tests

Strategic Vision is one of the most elusive facets of corporate strategy. Most organisations have a Vision Statement, but sadly few in my experience have a Vision.

Evaluating Vision Statements: 1. The Sniff Test

These days, most organisations' vision statements are quite easy to discover as they are proudly displayed on their web sites or in their annual accounts. However, I have cautioned before in Strategy as Public Relations against assuming that the published strategies, vision statements, etc. of organisations are anything more than deliberate signals to the market or even to employees. And so I would always advise checking to see what a firms' board's real vision is before jumping to conclusions. This may require a more subtle line of inquiry.

The worst example of a stated vision statement I have ever encountered was an organisation whose strategic plan opened with an intent to be: "first for customers, first for employees, and first for shareholders."

I usually apply two tests to vision statements before I even begin to try to understand whether they are strategically valuable. These are:

  1. Could you identify the business, or even the industry? Read the example above again. I defy you to guess even the industry.
  2. Could you say it was not that, and still sound credible? For example, could you credibly say "Our aim is not to be first for customer, first for employees and first for shareholders, but instead it is..."?

Only once a vision has passed those two tests do I start to consider whether the vision is likely to lead to value creation given its internal capabilities and market positioning.

Evaluating Vision Statements: 2. The Discriminatory Test

The role of a vision statement is to paint a vivid picture of what success will look like. It should be succinct and memorable. It can be a statement, in the conventional sense, but it could equally well be a story, a checklist or any other suitable form of communication. Most importantly, it should be something against which a decision maker can weigh two otherwise equally potentially profitable options, and conclude which one will best take the organisation towards achieving its vision. If two honest and intelligent decision makers can reach conflicting conclusions under such a circumstance (and I have encountered this on more than one occasion), then the vision statement has failed to achieve its purpose.

Evaluating Vision Statements: 3. The Value Test

The final criteria for a vision statement is whether it is likely to create sustainable value.

  1. It should be stretching but achievable. Just like a desert mirage -always just within sight but just out of reach. If it is too easy to reach, it will not force decision makers to exercise themselves enough. If it is too hard to reach decision maker will start to insert their own, potentially divergent, interim milestones. These will ultimately take the organisations' focus away from its goals. (Visions differ from objectives in that ones hopes to put a "tick in the box" for objectives, whilst a vision moves forward just ahead of the organisation's ability to achieve it.)
  2. It should capitalise on the organisations particular relative (to its competitors) strengths, and work around its weaknesses. It should fit the particular organisation, in its current state, like a glove. In that way it should never be true that the vision would be better suited to one of the organisation's competitors.
  3. It should be appropriate to how the market will be when the vision is realised. Markets don't stand still. The best visions, when realised, transform the market. But even aside from that, markets continue to change and develop while the organisation executes its strategy. The vision should be value maximising in the market as it will be in the future, rather than as it is now.

A strategic vision should lie at the heart of every successful strategy - it is the purpose of the strategy. Coming up with the right vision is perhaps the most difficult part of The Strategic Learning Cycle as more than any other stage of the process it relies more on artistry than on technical skill.

What are your favourite examples of either good or bad vision statements?

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Anonymous said...

Dear sir,

Reading your writing makes me indulge in my new university vision statement that writes:"To be a renowned university that nurtures professionals and scholars with high moral and ethical values"

I commented that the proposed vision "take the organisations' focus away from its goals." doesn't actually address the core clients -students; the financial outcome (ours is a private self generating income university. Please comment. Thank you. Rosli e address

Chris said...

Hello Rosli,

It is very difficult to comment on the specifics of a vision statement without being familiar with your organisation. However, you might start with the following questions:
1. Is nurturing high moral and ethical values a distinctive proposition in your market, and is it enough on its own to be the basis for students and staff to choose your university over others?
2. Is your university a generalist university or does it specialise in some academic field? If it is the latter, then this should be evident from your vision statement.
3. Is being self-funding a key differentiator from your targets' (students, staff, etc) perspective, or is it just a means to an end? (Your vision statement would not need to mention financial outcomes unless these are a differentiator.)

Good luck,

Saheed said...

Dear sir,

I read the article and I picked a thing or two.

What do you think of this vision statement: "To be a foremost supply chain solution provider across Africa"