innovation

PBL Trigger 4 Problem:

How can a company adapt successfully in a changing market?

Keywords: Mission, vision, strategy, changing markets, adaptation, expand, success, business plan, core competence, worldwide, values, business identity, sacrifice, innovation

LO1: What is the difference between Mission and Vision in Business?

LO2: How Mission and Vision leads to Strategy?

LO3: What are the Strategies to keep up successfully in a changing market?

Introduction:

On my this blog post I’m going through the topic of our PBL Trigger 4 problem: ” How can a company adapt successfully in a changing market? ” This research also includes three learning objectives enclosed by the same topic. I will start with defining the difference between Mission and Vision in business life. Then in the second learning objective I will find out that how do these lead to company’s strategy. Now I can argue that do they actually lead to the strategy or are they part of that process? Lastly I am going through some examples of strategies that can lead companies to success in a changing markets and adding the conclusions of it.

What is the difference between mission and vision?

These days companies need to have direction in which way to implement the plans to obtain their goals. The vision and mission statements are usually giving this direction to companies. Also, it is good for the employees of the company to have certain cohesive idea how to work together towards the common goals.(Kirkpatrick 2019.)

If the business doesn’t have any of these goals, vision or mission, at some point it will face a lot of problems with employees and finances. That’s why it is important that the company regularly keeps on track with their goals, mission and vision, to inspire, support and develop the employees and whole business to the desired way. For the company to success, they should review the statements actively.(Kirkpatrick 2019.9

The Mission (also can be called action plans, broad strategy) means company’s smaller agenda and mission to ultimately achieve the bigger goal, a vision. (Examples like daily to do’s, targets, changes to be done…)

Mission can include different task or to do’s that all the workers of the organization participates in. It usually is a statement that can be one statement or different ones, but its purpose is to give the workers in the organization a certain framework or idea how to behave and act in that company. It helps the employees to focus on the tasks that can be done right now and give them a present purpose to work on. The mission statement can change, and companies must adapt it to the changing markets to maintain and reach success.(Kirkpatrick 2019.)

Example of Patagonia’s mission statement: ”We are in business to save our home planet. Build the best product, cause no unnecessary harm, Use business to protect nature, Not bound by convention. ”(Patagonia).

The Vision (also known as core values, overall goals) Statement is a clear precise statement of what the company wants to do and what is the ultimate result/affect after accomplishing your mission. It is the ideal achievement that the company wants to reach. The vision is usually future orientated unlike the mission which is focusing on the present. The idea is that when the company can read their vision statement in present form they will now that it is achieved. Often the organizations can use vision statement in the public purposes, like public relations and marketing. It is important that the company have vision because that will drive it and give a direction for its purposes in a long run.(Kirkpatrick 2019.)

The difference in general is that the mission statement defines what the company is currently doing, or what they need to do to achieve the overall goal. It is giving the employees and other members the guidelines to HOW to achieve the vision. Employees duties, actions and the way they represent the company should include in the mission. The vision in the other hand is giving the idea WHY to the workers; why we are doing the actions we are? It is not very specific and effective way to direct an individual employee actions about the day to day tasks but is does give an overall idea of what the organization want to accomplish.(Kirkpatrick 2019.)

Example of Teach of America’s vision statement: ” One day, all children in this nation will have the opportunity to attain an excellent education.”(TeachForAmerica).

How Mission and Vision leads to Strategy?

Strategy is very much connected to the mission and vision of the company. Strategy could be described as a last step in this ‘process’ that company goes through to achieve the vision. That is why it is crucial for the company to have them both before adding strategic elements to it. When the company is creating the strategy, there can be sometimes additional steps added, like specific objects or targets that they want to reach. These can be used as the base for the overall company strategy.(Miller 2014.)

The organizations strategy should include both long-term and short-term goals and more specifically explain how to achieve the goals that have been set. The company strategy should also be adapted and updated frequently to keep up with the local,- and international economical situations and company’s own needs.(Miller 2014.)


source of the image:  https://upload.wikimedia.org/wikipedia/commons/0/0e/5_STEPS_STRATGIC_PLAN.png accessed: 30.9.2019

The purpose of the company’s strategy is to successfully align the mission with the vision. It is also important that the strategy with its tactics, tasks and ideas are in line with the company’s values. If all these factors are not working with together it is possible that the strategic plan is more likely to fail.

What are the strategies to keep up successfully in a changing market?

There are numerous business strategies that can be implemented in a different way depending of the field and many other factors. According to Udemy’s article about business strategies that make money there are examples of the business strategies that company can create to attract customers and gain its goals.

Cornering a fledgling market. Which means that the company is buying out their competitors or when a larger company merge with a competitor to corner a young market. For example, Facebook buying Instagram. That lead to competitive advantage over google, Microsoft…(Mikoluk 2014.)

By Product differentiation the companies can stand out with the product from the competitors. Unique qualities, brand, superior technology, styling, price.(Mikoluk 2014).

By Gaining a technological advantage. Due to our vastly developing technological innovations around the world, it is an advantage if a company can claim the latest technology to themselves. This means that often companies are investing a lot of money to different researches or they even buy minor companies just to gain access to their technology and patents. Also, some key employees might come as a technical advantage to some companies.(Mikoluk 2014.)

With Pricing strategies, the companies have option to keep the prices low to attract more customers or pricing the product so high that it is not reachable for all the consumers but giving the product endeavored value and status. For example, The Swedish furniture brand Ikea bargain for low prices with suppliers and manufacturers, keeping the margins very low and then selling volume instead. The products are more competitive with the lower price and therefor are selling more.(Mikoluk 2014.)

Core competencies are a great tool for companies to use to identify at what they are unique at. How the company stands out from its competitors.

In the Core Competence of the Corporation (1990) it is introduced that the core competence as something that a firm can do well that meets three conditions: It provides consumer benefits, It is not easy for competitors to imitate & It can be leveraged widely to many products and markets.(Prahalad C.K & Hamel G. 1990.)

However now days the definition of core competencies has evolved and expanded. For example, Susan ward describes the core competencies as:

”key abilities or strengths that a company has developed that give it a competitive advantage over its peers and contribute to its long-term success.” Core competencies are difficult for competing businesses to duplicate.”(Ward 2018.)

Ward is also arguing that the successful companies often have more than one of these core competencies: quality, customer service, value, innovation and marketing.(Ward 2018.)

Conclusions:

There is more than one answer to a question ”How can a company adapt in a changing market?”. It depends a lot about the company and the field. However, regardless of the differences it can be argued that most of the successful companies have the same basic core elements; strategy, mission and vision. Inside the companies strategies there can be a lot of variability yet still many of the key elements like, customer service and innovation, seem to be always present. Overall the strategies are supported by company’s vision and mission statements and other way around. The implementations of these statements and plans guides and drives the companies to success in the changing markets.

Resources:

Kirkpatrick N. January 11, 2019. Article “The Difference Between Vision and Mission” on betterhelp. https://www.betterhelp.com/advice/general/the-difference-between-vision-and-mission/ .Accessed: 30.09.2019

Mikoluk K. January 7, 2014. Article “Business Strategy Examples: Four Strategies Businesses Use to Make money” on Udemy. https://blog.udemy.com/business-strategy-examples/ .Accessed: 30.09.2019

Miller B. September 9, 2014. Article “Strategy, Mission and Vision: How do they all fit together” on HR Daily Advisor. https://hrdailyadvisor.blr.com/2014/09/09/strategy-mission-and-vision-how-do-they-all-fit-together/ -Accessed: 30.09.2019.

Patagonia, 2019, the company’s mission statement: https://eu.patagonia.com/fi/en/company-info.html Accessed: 30.2019

Prahalad C.K & Hamel G. 1990. In the “the Core Competence of the Corporation” .

Ward S. November 4, 2018. “Core competencies in business” on the balance small business. https://www.thebalancesmb.com/core-competency-in-business-2948314 .Accessed: 30.9.2019

Teach for America, 2019, the organizations vision statement: https://www.teachforamerica.org/what-we-do/who-we-are .Accessed: 30.9.2019