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DA5. When Strategy Contradicts Vision, Mission, or Values

Statement

In the last unit, we learned about vision, mission, and values. In this unit, the text states: “…a strategy captures and communicates how vision and mission will be achieved and which goals and objectives show that the organization is on the right path to achieving them” (Carpenter et. al., 2010).

  • What negative consequences can emerge when vision, mission, or values contradict strategy?
  • Name a time when you believe strategy was not aligned with vision, mission, or values.
  • How can leaders ensure that strategy matches the vision, mission, and values?

Answer

Introduction

A strategy is a plan of action that will connect the Mission and Vision statements to goals and objectives. A strategy has two phases: formulation involves putting a strategic plan and implementation involves executing the plan. Mission is a statement that summarizes the purpose of the organization; Vision is a statement that describes the future state of the organization and what it wants to be; and Values are the beliefs that guide the organization’s actions (Carpenter, Bauer, & Erdogan, 2010).

The Mission and Vision serve as the foundation for the organization’s strategy; they also communicate the state of the organization to the stakeholders; and they help in developing measurable goals and objectives (Carpenter et al., 2010).

Negative Consequences of Misalignment Between Strategy and Vision, Mission, or Values

When the strategy contradicts the vision, mission, or values, the organization may face negative effects. Thinking of strategy as a bridge between vision and mission means that any misalignment will put the organization on different parts of the other side of the river.

Willoughby (2020) indicates that such misalignment will lead to negative (or at least unpredicted) financial performance, especially since the goals and objectives were not correctly set. It is also associated with customer and staff loss as the confusion that happens makes employees want to leave and unhappy customers. It also negatively affects the organization’s reputation and brand image as an organization that is bleeding customers and staff is not seen as a healthy one.

Examples of Misalignment Between Strategy and Vision, Mission, or Values

Misalignment between strategy and vision, mission, or values can be seen in various images; the simplest form is when the company mission/vision/values assert customer happiness while the strategy only focuses on profit which can lead employees to deal with customers quickly putting the customer’s needs at risk.

Another example is Enron which is an energy company founded in 1985; its motto was “Respect, Integrity, Communication and Excellence”. Its “Vision and Values” mission statement said, “We treat others as we would like to be treated ourselves....We do not tolerate abusive or disrespectful treatment. Ruthlessness, callousness and arrogance don’t belong here.” (Amerland, 2024). However, the company’s strategy was to use shady accounting practices, special purpose entities, and manipulated financial reporting to hide its huge loss. This strategy led to the company’s bankruptcy in 2001 (Segal, 2024). Enron’s strategy misaligned with its mission; it was not treating others as it would like to be treated.

Ensuring Strategy Matches Vision, Mission, and Values

To ensure that the strategy matches the vision, mission, and values, Carpenter et al. (2010) suggested using the Strategy Diamond; it is a good tool to implement a strategy that forces leaders to think about different aspects of the company that cover its vision, mission, and values.

Panel (2023) also suggests constructing a clean company mission; demonstrating company values daily; creating KPIs (Key Performance Indicators) that can be measured and tracked; leading by example by showing employees how to do things; and listening to employees and customers to understand their needs and concerns.

Conclusion

Strategy is the bridge between vision/mission/values and goals/objectives; performing well requires that the strategy be aligned with the mission; the strategy is simple, consistent, long-term, clear, deep, and objective. A misalignment can lead to negative consequences such as financial loss, customer and staff loss, and a damaged reputation. To ensure alignment, leaders can use the Strategy Diamond, construct a clear company mission, demonstrate company values daily, create KPIs, lead by example, and listen to employees and customers.

References

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