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What is Vision Statement ? - Features, Significance, Limitations

Vision Statement

Contents :                                  
  1. Meaning and Definition of Vision.
  2. Features of Vision.
  3. Process of Envisioning.
  4. Significance of Vision.
  5. Limitations of Vision.
  6. Differences Between Vision and Mission.


What is Vision ?


Vision statement can be referred as the statement defining company's long term goals. A vision statement can exceed from one line to a few paragraphs highlighting what the organisation want to achieve in future.
An effective vision statement motivate the employees and provide them a sense of direction for carrying out day to day business activities and also help in taking strategic decisions.

For example : 
Infosys vision is "To be a globally respected corporation that provide best of breed business solutions, leveraging, technology, delivered by best-in-class people". 

An organisation's vision statement clarifies he significant primary goals to be achieved, but does not highlights the plan to accomplish these goals. It helps the organisational staff in formulating required strategies for carrying-out necessary business operations. Vision statement is common, mutual and for every employee in the organisation. Vision
statement is unique, simple, and competitive in nature. A good vision statement encourages the organisation to take risks and to pursue innovative ideas to stay competitive in market.

A vision statement is prepared to boost the morale of the employees by painting a picture of the path on which the organisation is heading. The vision statement of an organisation allows the managers to practically monitor the organisation's progress by comparing the stated objectives and operational plans for achieving those objectives. If the operational plans do not lead to the achievement of the ultimate organisational vision, the plans can be modified when necessary.Vision statement integrates the organisation goals from various departments and forms a common mutual goal to be achieved. Good vision statement encourages innovation and fosters a feeling of ownership and belongingness within the employees and the stakeholders.

Definition of Vision :


According to Miller and Dess :
"Vision is the category of intentions that are broad, all-inclusive, and forward thinking".

According to Kotler :
"Vision is a description of something (an organisation, corporate culture, a business, a technology, an activity) in the future".

According to El-Namaki :
"Vision is a mental perception of the kind of environment an individual, or an organisation, aspires to create within a broad time horizon and the underlying conditions for the actualisation of this perception".

According to Oren Harari :
"Vision should describe a set of ideals and priorities, a picture of the future, a sense of what makes the company special and unique, a core set of principles that the company stands for, and a broad set of compelling criteria that will help to define organisational success".

Features of Vision :


A vision statement has following features :

1) Requires Careful Thinking :
Formulating a vision statement not only requires attractive tagline, but also requires strategic thinking regarding the future prospects of an organisation to achieve success.

2) Helps in Selecting Target Market : 
As a company cannot serve the needs of each and every type of customer, it has to customise the services for a particular target customer. Vision statement helps the organisation to decide the market segments to which the organisation would cater and make strategic decisions accordingly. In this way, the vision statement creates a strategic path for the organisation.

3) Decides the Long-Term Objectives and Focus :
Strategic vision helps in deciding the direction of the organisation and the strategies needed to achieve the set targets.

4) Future-Oriented : 
Vision is future-oriented. Vision does not represent an organisation's present condition; it depicts the state in which an organisation wants to be within the stipulated period of time. Therefore, in other words, it can be said that the vision statement highlights the organisation's future goals and helps in formulating necessary plans. It becomes important for an enterprise to formulate the vision while keeping a bright picture of future in mind.

Important Topics in Strategic Management :

Process of Envisioning :


Formulating the vision statement requires following steps :
  • Understanding the Organisation
  • Conduct an Audit
  • Narrow Down the Vision
  • Set-up the Context for Vision Statement
  • Create New Future Scenarios
  • Formulate Alternative Vision Statements
  • Select the Final Vision Statement
1) Understanding the Organisation : 
The foremost step of formulating a vision statement is to understand the organisation. To understand an organisation in a better way the management must identify following details :
i) Nature the industry.
ii) Mission and purpose of the organisation.
iii) Kind of value it is providing to the society.
iv) Structure of the organisation.
v) Critical success factors of the organisation.
vi) Nature and type of stakeholders.
vii) Interests of the stakeholders.

2) Conduct an Audit :
Once the understanding of the organisation has been achieved by the strategic leader, the next step is to conduct an audit to assess the current position of the organisation and the pace at which it is progressing. Following aspects are to be analysed at this stage :
i) Current direction of the organisation.
ii) Mutual agreement by the key strategic managers on the direction of organisation.
iii) Organisational structure.
iv) Organisational activities.
v) Employees of the organisation at various levels.
vi) Compensation and remuneration plans.
vii) Information system and communication flow within the organisation.

3) Narrow Down the Vision : 
After conducting the audit, the next thing to do is to narrow down the perspectives of vision statement. Narrowing down here implies considering the factors that are necessary to form a vision statement. Some of the important questions to be answered here are as follows :
i) What are the limitations of the vision statement ?
ii) What would be achieved by the vision statement ?
iii) What issues are to be considered by the vision statement ?

4) Set-up the Context for Vision Statement : 
In this step, the strategic leaders should anticipate the future aspects of the organisation. Anticipating the future does not mean to be predicting the future, but assessing the future surrounding. Some of the aspects to be considered are :
i) Anticipation and categorization of future developments which may affect the vision.
ii) Enlist the expectations with each category.
iii) Anticipate the probability of fulfilling the expectations.
iv) Assigning the probability of occurrence to each expectation.

5) Create New Future Scenarios :
As soon as the expectations are anticipated and their effect and fulfillment probabilities are understood, the next step is to associate those expectations to form a new scenario which involves a variety of possibilities in future anticipated by the strategic leaders. This will highlight the possible future scenarios that the organisation may have.

6) Formulate Alternative Vision Statements : 
In this step the possible future alternatives are discovered and decided, on the basis of which the strategic leaders determine the directions that lead to those alternative future courses. In this step, alternative vision statements for each direction formulated. However, these alternative vision statements are not evaluated in this step.

7) Select the Final Vision Statement : 
This is the final stage where the strategic leaders would select the best among the alternative vision statements. For this, it is necessary to closely analyse the vision statements. It is important to know the characteristics that a good vision statement should possess. The essential factors which are required in order for the vision statement to become successful should be considered. 
Organisational culture and values are some of the important factors. After analysing the characteristic features of a good vision statement, the alternative vision statements are compared and analysed against the possible future challenges and opportunities. The comparison is based on the applicability of the vision to wide platform of future scenarios. It should be noted that the final vision statement should qualify in the criteria for good vision statement.

Significance of Vision :


Strategic vision is important to an organisation for following reasons :

1) Acts as a Measure of Excellence : 
A strategic vision acts as a measure of excellence. It motivates and inspires the employees to achieve the level of excellence and skills in their work. It also works as the on-going goal and encourages the employees to improve the quality of work. It also provides the parameters to measure the value of the organisation.

2) Overcomes the Gap : 
The vision statement is created for future. A good vision takes the organisation from its present to the future. Hence, it overcomes the gap between the current position of organisation and the desired future scenario. It helps the organisation to focus on the issues of future and the ways to deal with them. The vision statement helps the decision-makers to chalk out strategic plans which can guide an organisation to achieve the desired state of future.

3) Helps in Solving Internal and External Issues :
A good strategic vision helps the organisation in dealing with both the internal and external issues. On one hand, it inspires and guides the employees towards a certain direction, while on the other hand, it helps the organisation to capture market and create a distinctive market image among the competitors.

4) Helps in Setting Goals for Future : 
Vision statement highlights where the organisation is now, and where it wants to be in the future. It helps the employees to set common organisational goals and inspires them to achieve those goals.

5) Creates a Sense of Responsibility : 
Strategic vision creates a sense of responsibility in the employees, which in turn motivates them to enhance their skills and create interest in working towards achieving the organisational goals. It creates a distinctive image in the minds of the employees by offering personal gains so that they are motivated to perform with zeal and enthusiasm.

6) Provides a Reason for Existence : 
A vision statement provides a reason to the organisation for its existence by projecting the ideal image of the future. It helps in integrating the resources for realisation of the desired future scenario.

Limitations of Vision :


Vision statement suffers from following limitations :

1) Ambiguous and Incomplete : 
Vision statements are generally not written in detail with specifications regarding the desired future position of the organisation. This makes a vision ambiguous and incomplete.

2) Does not Highlight's the Path : 
The vision statement only projects an image of what the organisation wishes to achieve, but it does not tell if and how the organisation will realise the desired goals.

3) Wide-Ranging :
The vision statements are so wide-ranging that the company can move in any direction, can grab any opportunity, can serve any customer at any location. Such kind of broadness in vision creates a misconception about the target market and specific direction of the organisation's growth.

4) Fails to Motivate and Assure : 
The vision statement at times fails to motivate the employees to pursue certain goals. It does not assure the shareholders regarding the direction of the organisation.

5) General Statement : 
Generally, the vision of an organisation is a common statement, making it applicable to any company. It does not provide a distinct identity to the organisation.

6) Projects a Superlative Image : 
It exaggerates about the future position of organisation without defining the company's strategic course. The vision statement projects the image of the organisation as the consumer's first choice, globally renowned leader, best in class, etc. Hence, it projects a superlative image of the organisation.

vision and mission

Differences Between Vision and Mission :


Basis of Differences

Vision

Mission

Meaning

 

Vision statement defines what an organisation wishes to achieve.

Mission statement define the reasons for existence of the organisation. It specifies the functions and features of the organisation.

Existence

 

Usually lasts throughout the lifetime of the organisation.

Change or modified minimum at every 6 months.

 

Nature

Outlines the long-term objectives of the organisation.

 

Highlights the current position and gives the overview of the future in terms of product, price, market etc.

Plan of Achievement

 

Does not specify the plan for achieving the goals.

Specifies the plan for achieving the goals.

Time

 

Choose the future scenario of an organisation.

Choose the present as well as the future of an organisation


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