Posts Tagged ‘vision’

I was discussing the importance of “core purpose” with a client when their newest team member (a newly minted marketing MBA) piped up and argued that “The core purpose of a business is to make money.” I was gobsmacked. (Really? That’s what they’re teaching? What do you call an observation that is simultaneously obvious and useless?)

In September 1996, Built To Last authors Collins and Porras observed in the Harvard Business Review, “Companies that enjoy enduring success have core values and a core purpose that remain fixed while their business strategies and practices endlessly adapt to a changing world.” They go on to say that companies that do “have historically outperformed the general stock market by a factor of 12.” By contrast, those that don’t often find themselves scurrying after minor market opportunities and living off the crumbs left by more successful competitors.

The article, Building Your Company’s Vision, is part of the collection HBR’s 10 Must Reads On Strategy.  The Kitchen highly recommends reading it cover to cover. Until you find the time, here’s the gist reduced to a single illustration.

Companies that enjoy enduring success have core values and a core purpose that remain fixed while their business strategies endlessly adapt to a changing world.

This picture says you need to have a goal. Not just hitting this year’s revenue numbers, but a Big Hairy Audacious Goal — something like “displacing Microsoft” or “a store in every town in America.”  That goal should be a byproduct of your adding value to the world in ways that no other company can — your envisioned future. (Henry Ford envisioned a world where the streets were free of horse dung because every man owned a car. Seriously.) You get there by leveraging your core technology into a unique and compelling value proposition delivered by a business model designed to capture the market. When things get ambiguous, you and everyone in the company can make good decisions focusing on the company’s core purpose and not straying from its core values.

Sound like too much “peace and love?” Anyone who is invested in your company for the long term will love it. And it will bring you peace of mind.

Competition is the creation of buyers. It is The Truman Show of the marketplace. The buyers are the show’s producers; your company is Jim Carey’s Truman.

Truman’s fans adore him. His producers and sponsors need him. Everything depends on Truman believing that his fabricated world is real.

It’s easy for Truman to comply because in his TV world actions seem to have real consequences. Same for sellers. Effective prospecting leads to presentations. Thoughtful presentations lead to full-scale proposal pitches. Nailing the pitch often leads to a win.

As with Truman’s daily travails, the euphoria of success and the anguish of failure effectively mask the truth: Your company’s real potential has been subordinated to someone else’s plotline — a handful of functional criteria that were written long before you and the other actors showed up.

If you’re tired of their fabricated reality, you can break out. You just have to be willing to walk off the set. Life outside the show’s construct is risky, as Truman’s self-serving producer warned. But it’s also more rewarding.

Good brands last by evolving with the times. That means a good brand strategy doesn’t just position a brand at a moment in time, but establishes a direction for the brand to evolve and innovate as new competitors emerge and categories evolve. Your brand direction should be aspirational and extensible. It is not a thing to be achieved, but a direction in which to strive.

Brands that are defined by a position rather than a direction eventually become irrelevant. Take FedEx, the first overnight delivery company. Its position was clear: “When you absolutely positively have to get there overnight.” Then competitors moved in. And the category became too small. With no clear brand direction pointing where to go, FedEx now struggles to say what it stands for.

There are five potential directions from which you should choose the best single direction for your company:

1. Category: it’s about perpetual product leadership
2. Core technology: it’s about forever leveraging the essence that powers what you deliver into more products and services
3. Market: it’s about fulfilling more of the unmet needs of a particular market segment
4. Core belief: it’s about a principal that drives everything the company does
5. Vision: it’s about how your company is helping make the world a better place

Start by defining each direction, like we’ve done for Dangerous Kitchen below. When you’re done, each direction will feel like a piece of a harmonious whole, and you won’t want to choose. But you must. For example, we’ve chosen to continually push the limits of our category.

Click for PDF

Realize that over time, the pieces will drift apart. Knowing your direction now will let you know what to let go of and what to drive toward as your world changes.