Goal Setting and the Mission Statement

Video Transcription

Hi, I'm Jeff. And in this lesson, we'll learn about how a business approaches goal setting and talk about the way a mission statement can be used. So let's get started. In order for a business to succeed with its strategy management, it must be effective at setting goals. Goals are the wished-for conclusion of a process. Whether a business is small or large, goal setting must be clear and consistent.

Goals can be large scale so they impact an entire organization, or they can be small scale so they impact one division or only specific individuals. And goals can be set at any level of the organization from highest to lowest level.

There are three types of goals that can be used for strategies-- long-term goals, which are goals to be met in five years or more. They are used for broader business vision, such as the entry into new geographic markets.

Intermediate goals, which are goals of 1 to 5 years in length-- these can be used for product development goals, for example. And short-term goals, which are less than one year in length-- these can be used to improve existing metrics and processes so the business can operate more efficiently.

Each of these three goals can be used to strengthen the others. For example, a long-term goal to enter a new market might be supported by intermediate goals to develop new products for the market and short-term goals to improve the process for new marketing material development. This can go the other way also where short-term goals are then used to develop the intermediate and long-term goals.

Now let's discuss the purpose of goals. Goals are a primary method an organization can use to communicate with employees. And managers can assist significantly in this process. Some of the ways that goals can help a business succeed are-- direction for management. Managers will direct their efforts and the efforts of their direct reports based on goals. Direction with resource allocation-- goals can help guide decisions about resources and how they should be allocated.

Definition of corporate culture-- goals can reflect and even help develop the corporate culture. Corporate culture is the commonly understood and accepted history, ethics, ideals, and attitudes within an organization. And goals can be used as means to assess performance. Employees can be evaluated relative to the stated goals.

Now that we've discussed goals, let's talk about the mission of an organization. Goals are based on the mission of a company. So they are different from company to company. Many companies have a mission statement, which is the official description of the intention of an organization. A mission statement can drive the choices that an organization makes. And no organization should make any decision that contradicts what is within their mission statement.

Let's review an example of a mission statement next. Here is a mission statement for Barnes & Noble. As you read through this statement, imagine the choices that would be made based on its content.

For example, if Barnes & Noble had the opportunity to create a large clothing line as part of their business, is that something they should do? The answer is likely no based on their mission, since books are their primary product. They might produce shirts that promote the act of reading, but an entire clothing line is far outside their mission statement.

As you can see, a clear mission statement will inform decisions and goals at all levels of an organization. That is why a strong mission statement is important for an organization. It is another method used to communicate the highest level goal of a business.

OK, good job. In this lesson, we learned what goals are and the type of goals used by a business. We also talked about the purpose of goals. We discussed the mission of an organization and how that is reflected in a mission statement. And finally, we reviewed a sample mission statement. Thanks for your time and have a great day.