A decisive survival factor for any company is its ability to anticipate changes in its environment. Take a look at the past: How many economic, demographic and technological transformation processes have today’s companies had to react to that have successfully remained on the market over the last 50 years?
For example, do you remember the brand of the first mobile phone you owned? The answer is most likely “Nokia”. At the end of the 1990s, the Finnish company was the world’s leading providers of mobile phones. Today, Nokia has joined Kodak on the list of failed companies that reacted to digital advances too little too late.
The extent to which a company’s development is influenced by changing conditions depends on a variety of factors, such as the industry, the type or product or service and, last but not least, the company’s resources. However, those that integrate continuous change into their organization’s strategic roadmap gain a crucial advantage over their competitors.
Change management allows companies to respond promptly to change processes and prevent negative repercussions for the organization. However, this development does not happen by itself. As a manager, you should initiate a change management process at the right time in order to maintain the company’s success in a dynamic environment.
You lay the foundation for the appropriate development of your company by formulating a meaningful and trendsetting vision. Sustainable results can only be achieved if the company managers can both visualize and articulate where the future path should lead.
When well-known companies present their “vision statements”, they often introduce their mission, vision and strategy together. The formulation of all three terms is also important for determining the future development direction of your organization. It is therefore helpful to separate the concepts of vision, mission and strategy:
By formulating your corporate vision, you set the course for all future developments and internal decisions. The vision sets a positive outline for the future of the company and describes what role the organization should play in the future.
Example: The current vision adopted by PepsiCo indicates the status the company wants to achieve in the future: “Be the global leader in convenient foods and beverages by winning with purpose”.
The organization’s mission is derived from the vision. It is a description of the purpose of your company with regard to internal stakeholders and the external community.
Example: The US company PepsiCo defines its mission as “Create more smiles with every sip and every bite.” Based on this, the company sees itself as playing the following role with regard to its customers: “We bring smiles to our customers by being the best possible partner, driving game-changing innovation, and delivering a level of growth unmatched in our industry.”
The strategy describes which strategic measures should be used to implement the vision and mission. The feasibility of a vision is a decisive factor for the success of a change management process. Many companies therefore use the term “strategic vision”.
Example: To implement its vision of being the “global leader in convenient foods and beverages by winning with purpose”, PepsiCo has developed three strategies: “Faster, Stronger, Better”. Each strategy is divided into three or four practical and measurable actions. For example, for the “Better” strategy, they have defined the following actions: “Replenishing more water than we use in water-stressed areas, so we can assure business continuity, while positively contributing to our communities.”
The vision for your company is the image of a positive state after specific changes have materialized. The desired vision of the future is easy for stakeholders to understand and motivates them to support the necessary changes. It contains measurable actions that will ensure the desired result is implemented.
To formulate a strong corporate vision, develop the elements mentioned above step by step:
The basis for preparing your vision is the formulation of a desired vision for your company’s future. The “target future state” should address relevant developments in your corporate environment and be feasible in the context of your corporate goals and resources.
As a first step, you should formulate the reasons why the change is needed. Use the following questions to guide you:
You should also communicate this underlying motivation for change to your employees and business partners later on, which will help to convey the relevance of the changes being made (see point 2 “Motivate and reach all stakeholders”).
As a second step, you should describe the positive state for which you are aiming once the necessary changes have taken place in your company.
Take into account your corporate mission, the overarching business goals and the future of the various departments and employees in your company.
Example: In its vision “Together 2025+: Shaping mobility – for generations to come”, Volkswagen projects a future for the company in which it “makes cars that are clean, quiet, intelligent and safe with electric drive, digital connectivity and autonomous driving.”
By formulating the “future target state”, you as a manager ensure that the changes occuring in your company are both relevant and goal-oriented. However, your vision will only be effectively realized if the stakeholders in your company buy into it.
According to a study in the business magazine Forbes, employees who don’t find their company’s vision meaningful show an average engagement rate of 16 percent. On the contrary, however, employees who find great meaning in the company vision play a much more active role with an engagement rate of 68 percent.
So how do you design a corporate vision that is as meaningful for the new trainee as it is for the CEO of the company? And how do you ensure that all employees have a clear and solid understanding of the change vision?
It should be possible for all members of the organization to convey the vision in their own words, and, more importantly, to understand it quickly. For this reason, use clear and concise language without technical terms or colloquial expressions.
By creating a memorable and emotionally appealing vision for your company, you motivate your stakeholders to actively strive towards it. International companies should also ensure that their vision is understandable and motivating for stakeholders from all countries and cultures in which the company is represented.
You should be able to express the core message of your vision in one or two sentences. Any additional explanatory information should not take up more than half a page in writing and should be verbally conveyable within 60 seconds. We recommend you also formulate a longer version of the vision that contains more background information and can be presented internally if needed.
Conveying your vision is essential if you want to achieve it. Communicate and repeat your vision in different channels and formats. The motivation behind and benefits of the change process as well as the meaningful future state should be recognized and understood by all stakeholders. After all, only an employee who are themselves convinced of the company vision will pass it on to others and actively seek to make it a reality.
Vision and strategy should be conceptually separated from each other. However, one concept cannot function without the other. Without a vision, a strategy will lack a directional foundation. Without an executable strategy, the vision will merely remain an idea.
An important component of a feasible vision is therefore the formulation of tangible and measurable actions which you will then implement to achieve it.
Example: As part of its vision “Together 2025+: Shaping mobility – for generations to come”, Volkswagen defined five main areas of action. Key performance indicators (KPIs) were defined for each priority area. In the “Best governance” module, for example, the goal is to achieve a return on sales (ROS) of 7-8% by 2025.
As a subsequent step, you should formulate concrete goals and time-bound initiatives that you can implement together with your team.
A winning change process begins with a meaningful and trendsetting vision. However, the end of the development process has not yet been reached at this point. We are happy to support you in developing a strong vision for your company and partner with you on your journey towards an exciting future. Get in touch with one of our transformation experts!
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