Invest In My Idea

Defining Your Business Purpose

In any kind of work you can get buried in the day-to-day demands and so caught up in the details that you miss the bigger picture altogether. That’s why the business-planning process is so valuable. Writing a business plan allows you to step back and think about where you’ve come from and where you want to go, prompting you to ask and answer questions like the following:

• Why are you in business?
• What does your business do?
• What do you want your company to become?
• How will you get where you want to go?

If you’re thinking that these questions are pretty basic, you’re right. But that’s exactly what makes them so important. You’ve heard too many scary stories about companies with great promise — and often tons of money to boot — that suddenly falter and fade away. Many of these companies could’ve avoided a lot of trouble along the way if the people steering the organization had taken the time to address basic issues during the planning stage.

To lead your business toward success, start by really focusing on why you’re in business and what you want to achieve. Put your business values and vision into words, write a clear and compelling mission statement, and set goals and objectives to turn your mission into reality. This chapter shows you how to accomplish these tasks.

Knowing What Business You’re Actually In

Business history is littered with the remains of companies whose founders thought they knew what businesses they were in, only to discover that the industries weren’t quite what they seemed.

_ Take a look at the railroad industry’s history. During their heyday, railroad tycoons assumed that they were in the railroad business. Along came powerful competitors that had nothing to do with railroads automobile manufacturers, the interstate highway system, jet aircraft, and regional airports. The tycoons realized that railroads weren’t in the railroad business after all; they were in the transportation business. Perhaps if they saw the big picture sooner, they may have had a rosier future.

_ Eastman Kodak, over its long history, made most of its money processing film — so much money, in fact, that the company came to believe that it was in the chemical-imaging business. Along came the digital revolution and new ways to record images. In no time, Kodak’s customers weren’t interested in the photo process, but in capturing memories — on film, video, or computer. Kodak was in the memories business all along.

_ In a resort town in Florida, Mom and Pop’s Toys thrived for years — until Toy Mania opened right across the street. To compete, Mom and Pop’s Toys reduced prices. But Toy Mania had a bright idea. The management team created a fantasyland with puppets, animated cartoon characters, giant windup toys, and a variety show that performed three times a day in the store. In short, Toy Mania realized it was in the entertainment business. Within a year, Mom and Pop’s Toys closed. It couldn’t compete because the owners didn’t understand the business they were in. The first step in planning for business success is to identify what business you’re in. Why do customers want the solution you provide, and why do they choose your business over the competition?

 

How would I describe my business?

Begin by answering this question: What business are you really in? Here are three related questions to guide you to your answer:

• What basic needs do you fulfill in the marketplace?
• Beyond specific products and services, why do customers come to you?
• What are the three nicest things your customers could say about you?

how a company that provides text-editing services, mainly to marketing and communications departments and mainly over the Internet, answered these questions.

 

BASIC BUSINESS DEFINITION FRAMEWORK

1. What basic needs do you fulfill in the marketplace?

For each of our corporate clients, we make sure that all printed and Internet text materials are grammatically correct and conform to the company’s style requirements.

2. Beyond specific products and services, why do customers come to you?

The reliability and quality of our service. Peace of mind. Not having to worry that the company will look bad in print. Confidence that what’s published is correct and understandable.

3. What are the three nicest things your customers could say about you?

That we’re thorough and reliable. That we have excellent turnaround. That we’re friendly and easy to work with.

In reviewing their answers, the owners of the text-editing business were struck by the phrase “peace of mind.” Those three words helped them realize that in addition to providing a text-editing business, they were also in the insurance business — making sure that embarrassing typos and inconsistencies didn’t trip up marketing and communications managers. In response, the company changed a few of its procedures. The owners put a managing editor in place to oversee the largest projects, and they enhanced their client-service staff to provide more communication throughout the editorial process to reinforce their clients’ peace of mind. Within six months, business increased dramatically.

 

Where’s the money?

One of the biggest lessons from the dot-com crash is that a great business idea isn’t enough to ensure business success and a long life. To turn a great idea into a successful business, you need to define and develop a workable business model, or a method that your company uses to generate revenue, earn profits, and protect its position in the marketplace. In this early planning stage, while you’re defining your business and describing its purpose, do something very basic: Show yourself the money. Not literally, of course. But from the get-go, be clear about how you expect your business to profit. Way too many businesses start without a clear idea of where the money will come from, or they make general broad-brush assumptions to which they give no second thought or scrutiny. Writing off the question with the flippant answer that customers will give you money in exchange for the products or services you provide is easy. Business models, however, aren’t always that straightforward:

• The local movie theater gets revenue from ticket sales, but that’s only the beginning. The theater also makes money by projecting billboardstyle ads prior to the movie showings and from its concession stand, where it turns a tidy profit selling candy and buckets of popcorn. It also makes money from game arcades that expand the theater experience.
• Large fitness center chains make money on enrollment fees and monthly dues, but they also rake in cash by selling fitness-related supplements, exercise clothes, gym bags, and the services of personal trainers.
• Most magazines earn revenue from subscriptions and newsstand sales, but the lion’s share of their income results from the sale of advertising space. However, you can find an exception to every business model. Consumer Reports declares in its mission that it accepts no advertising. To maintain its independence and impartiality, it supports itself entirely through the sale of information and products, contributions, and noncommercial grants.
• Some companies sell their products at a loss — making their money from the sales of related consumables. Gillette, for example, doesn’t mind selling razors at cost, knowing it will profit from the sale of razor cartridge refills.
• Online businesses increasingly work to supplement sales revenue with revenue earned through programs such as Google AdSense (www.google.com/adsense), which allows information-rich Web sites with reasonable traffic counts to earn revenue by displaying ads on their Web pages. A first step toward defining your business is to detail how it will make enough money to stay in business — for the sake of the owners, the investors, the customers, the employees, and the community of which your business is a part. The advice (and the accompanying forms) throughout the rest of this chapter helps you define where the money’s coming from for your business.

 

Giving Your Company Its Mission

Your mission statement defines the purpose of your business and the approach you want to take to achieve success. Crafting a mission statement forces you to take a long, hard look at the key parts of your business, making the process a fundamental part of business planning. If you’re still not convinced that writing a mission statement is worth the trouble, consider these factors:

If you’re starting a business, a compelling mission statement can convince potential investors that you know who you are and where you want to go. A great mission statement doesn’t make up for a poor business plan, but an ill-defined or uninspired mission statement can make investors think twice about putting money on the table.

If you’re a company of one, a clear mission statement keeps you focused on what you do best. A mission statement helps keep you on track if you run into problems along the way.

If you run a growing business, a strong mission statement can help turn employees into team players. When everyone pursues the same purpose, your team stays pointed in the right direction. No matter what kind of business you’re in, a solid mission statement communicates the purpose of your business to people inside and outside your organization. It tells them who you are and what you do.

 

Asking basic questions

If you’re part of a small organization — and that includes a business of one — you can write your mission statement on your own, although getting an outside perspective never hurts. If you’re part of a medium-size or larger company, enlisting help is essential. You get fresh ideas and insights, and you encourage a sense of ownership in the mission statement, which helps forge a stronger business team. Whether you move ahead on your own or enlist some outside help, get a head start on the process by jotting down your initial responses to the eight fundamental questions on Form 3-2. One good way to answer these questions is to assemble a group of creative, energetic people, making sure that the group represents all major areas of your business if you’re part of a large company. Schedule several brainstorming sessions (for information on brainstorming, see Chapter 2), following this approach:

Session 1: Discuss the importance of a mission statement. Ask your team members to answer the Form 3-2 questions.

Session 2: Discuss your answers in a free and open conversation that gives all responses a fair hearing. Begin to build consensus on the best answers to each question.

Session 3: Using the framework in the following section, begin to outline your company’s mission. If your brainstorming group is large, you may want to select a smaller group to work on the mission statement.

Session 4: Review, revise, and polish the mission statement draft.

 

Framing your mission

Mission statements come in all shapes and sizes, each reflecting the nature of the company it represents (see the “Thumbs up, thumbs down” section in this chapter for examples). Some mission statements begin with definitions of company values; others begin with what the companies do; and others begin with descriptions of the customers the companies plan to serve.

In other words, there’s no single, perfect way to frame a mission statement. key ideas about what you do, who you serve, and how you plan to distinguish your company from your competitors. Together, these facts link ideas and form a framework for your mission statement. Figure 3-2 illustrates how a company that offers information and referrals for alternative medical treatments completed the form.

 

YOUR MISSION STATEMENT QUESTIONNAIRE

1. What exactly do we do?

2. What products and services do we offer?

3. Who is our ideal customer?

4. What customer needs do we meet, and what benefits do we provide?

5. What markets and geographic areas do we serve?

6. What sets us apart from our competition?

7. What’s the best thing a satisfied customer can say about us?

8. What gets us most excited about the company’s future?

 

YOUR MISSION STATEMENT FRAMEWORK

OUR PRODUCT OR SERVICE IS holistic health services.

WE PROVIDE reliable advice about alternative therapies

FOR people with chronic illnesses like cancer or diabetes

WHO ARE DISSATISFIED WITH standard medical care.

UNLIKE other referral networks in our area,

WE OFFER both information and referrals to local providers.

 

Crafting your mission

After answering basic questions about your business and evaluating how your answers relate to one another, you’re ready to transform your ideas into a mission statement. A few dos and don’ts Although you don’t have any cast-in-cement rules to follow, here are a few guidelines to apply:

Describe who you are, what you do, and what sets you apart. At the same time, keep your mission statement as short and sweet as possible.

Use plain language. Your mission statement serves as a guide for people who know your business and people who don’t, so make sure that everyone who reads it can understand it. If you can’t explain your idea clearly (what’s a multiplatformed B-to-B integration database solution anyway?), you aren’t clear yourself, or you haven’t gotten down to the basics yet.

Be specific. “We will be a leading provider of software” doesn’t say much. In contrast, consider the mission of Intuit, maker of Quicken software: “The company’s mission is to create new ways to manage personal finances and small businesses that are so profound and simple, customers cannot imagine going back to the old way.” Now that gets down to the nitty-gritty.

Be enthusiastic. A mission statement is meant to sell your message and inspire your troops, so give it a strong sense of conviction and commitment.

Avoid hype and hyperbole. The latest buzzwords — from “quantum leap forward” to “a mega-paradigm shift” — don’t mean much to most people. Stick to simple, straightforward explanations.

 

Before you finalize your mission statement, take a look at some examples from real companies, both large and small, to see which statements you find impressive, inspiring, or just plain stronger than the others. Start with the examples in Form 3-4. Whether you write your mission statement on your own or as part of a group, take time to respond to each example with a thumbs up or thumbs down, noting what you like about the winners and what you don’t like about the losers. Your answers will provide a stronger sense of what you want your mission statement to look like. Using your favorite mission statements from Form 3-4 as models, shape your own polished version.

 

Putting your mission to work

After you’ve written a strong, inspiring mission statement, put your words to work. Whether you do business on your own or run a large company, proclaim your mission loud and clear. If you’re a company of one, frame and display a copy of your statement to continually inspire yourself, your clients, your suppliers, and friends of your business. If your company is large, include your mission in your employee handbook. See to it that everyone in the company knows the statement by heart. Get creative: Print it on the back of business cards, post it on your Web site, and include it in company literature. Above all, put the words into action. Ultimately, your mission statement is worth only what you (and everyone around you) make of it.

 

EXAMPLES OF REAL-WORLD MISSION STATEMENTS

To be the leading global provider of handheld computing products and to provide developers with the industrystandard platform for creating world-class mobile solutions. (Palm, Inc.)

Why?

The mission of the Metropolitan Police Department is to prevent crime and the fear of crime, as we work with others to build safe and healthy communities throughout the District of Columbia. (Washington D.C. Police Department)

Why?

Get it there. (FedEx)

Why?

To explore, enjoy, and protect the wild places of the earth; to practice and promote the responsible use of the earth’s ecosystems and resources; to educate and enlist humanity to protect and restore the quality of the natural and human environment; and to use all lawful means to carry out these objectives. (Sierra Club)

Why?

To provide our customers with safe, good value, point-to-point air services. To effect and to offer a consistent and reliable product and fares appealing to leisure and business markets on a range of European routes. To achieve this we will develop our people and establish lasting relationships with our supporters. (easyJet.com)

Why?

The NBA’s mission is to be the most respected and successful sports league and sports marketing organization in the world. (National Basketball Association)

Why?

To manufacture world class quality molds to fill our customers' needs, provide satisfying careers for all our employees, and to earn a fair return in order to allow continuous improvement, and thereby enable our customers, and ourselves, to succeed in the future together. (Stellar Mold & Tool, Inc.)

Why?

United Community Center is a human service agency providing emergency assistance, daycare, social services and recreational activities for low-income children and families at risk in inner city Atlanta, Georgia. (United Community Center)

Why?

To make guests happy. (Disney World)

Why?

To create an online community, like no other, encompassing every facet of every municipality in the United States; to aid in online economic revitalization in partnership with local businesses and local, state and national government agencies; to publish, maintain and connect a network of community websites designed to entertain, educate and enlighten the residents of our great nation, while maintaining the highest standards of personal morals, business ethics and web etiquette. (A2Z Computing Services)

Why?

Dell’s mission is to be the most successful computer company in the world at delivering the best customer experience in markets we serve. In doing so, Dell will meet customer expectations of:

• Highest quality

• Leading technology

• Competitive pricing

• Individual and company accountability

• Best-in-class service and support

• Flexible customization capability

• Superior corporate citizenship

• Financial stability

(Dell Computer)

Why?

The YMCA of San Francisco builds strong kids, strong families and strong communities by enriching the lives of all people in spirit, mind, and body. (YMCA of San Francisco)

Why?

 

Setting Goals and Objectives

Well-chosen goals and objectives point a new business in the right direction and keep an established company on the right track. Just think about what football would be without end zones or what the Indianapolis 500 would be without a finish line.

• Goals establish where you intend to go and tell you when you get there. They help improve your overall effectiveness as a company — whether you want to increase your share of the market, for example, or improve your customer service. The more carefully you define your goals, the more likely you are to do the right things and achieve what you wanted to accomplish in the first place.
• Objectives are the specific steps you and your company need to take in order to reach each of your goals. They specify what you must do — and when.

Think of goals and objectives this way:

• Goals tell you where you want to go; objectives tell you exactly how to get there.
• Goals can increase your effectiveness; objectives back your goals and make you more efficient.
• Goals are typically described in words; objectives often come with numbers and specific dates.

Suppose that your goal is to double the number of people using your Webconferencing service. Your objectives may be as follows:

• Gain awareness by placing print ads in four regional markets and by airing radio ads in two major markets (by June 10)
• Attract first-time customers by offering an online giveaway of $1,000 (by June 1)
• Cultivate prospects by implementing a permission-based weekly e-mail to 2,500 targeted contacts (by July 10)
• Convert 10 percent of prospects to clients, using e-mail reminders (beginning July 25)

Together, goals and objectives form the road map for your company’s future. Without them, you risk making wrong turns and wasting precious energy. The following sections present three ways to approach the task of writing out your goals and objectives. Experiment by using all three approaches. If you come up with more goals than you can handle, the section “Making final choices” later in this chapter can help you sort through your list to choose the most important goals.When establishing goals and objectives, try to involve everyone who will have the responsibility of achieving those goals and objectives after you lay them out.

 

Approach #1: Tying goals to your mission

The first approach to specifying goals and objectives begins with a review of your company’s mission statement. (Don’t have one yet? See the section “Giving Your Company Its Mission” earlier in this chapter.) Use key phrases from your mission statement to define your major goals, which leads into a series of specific business objectives. The connections between goals and your mission are easy to visualize if you use a flowchart, as shown in Figure 3-3. In this example, key phrases in the mission statement lead to major goals, which lead to specific business objectives. 

 

Approach #2: Using goal-setting ACES

Most goals define positive outcomes that you want your business to achieve, but sometimes you also want to set goals to avoid pitfalls and to eliminate a few weaknesses. To help develop goals that cover all the bases, use the acronym ACES as you tick through the following key questions:

• Achieve: What do you want to attain in the future?
• Conserve: What do you want to hang on to?
• Eliminate: What do you want to get rid of?
• Steer clear: What do you want to avoid?

how an online shopping emporium, a small start-up company with big dreams, applied the ACES questions when creating a set of business goals.

Approach #3: Covering all the bases

One more way to think about business goals is to consider each of the four categories into which most goals fall:

Day-to-day work goals are directed at increasing the everyday effectiveness of your company. They may involve things like order tracking, office management, or customer follow-up. As a start, name at least one change that you can make in your day-to-day operations that will make a difference in your overall effectiveness. Write it down in the form of a business goal.

Problem-solving goals address specific challenges that confront your business, such as low employee morale or quality of service issues. List the two biggest problems that face your company, and then write goals that can solve them.

Development goals encourage the acquisition of new skills and expertise, whether for your employees or for yourself and whether you run a large company or operate as a freelancer or an independent contractor. So, how about formulating at least one development goal for yourself or your company?

Innovation goals help you find new ways to improve the products or services that your company offers, how you market your company, or how you distribute and deliver what your company sells. Can you identify any innovative approaches that could make your business more effective in the future? If so, formulate an appropriate goal. 

 

CHECKLIST OF COMMON BUSINESS GOALS

• Improve customer satisfaction
• Establish or increase brand awareness
• Find new markets for products or services
• Expand product or service lines
• Decrease time to market
• Improve employee satisfaction
• Increase management communication
• Reduce operational costs
• Generate new sources of revenue
• Become more entrepreneurial
• Increase networking with partners

 

 

Making final choices

The three goal-setting approaches in the previous sections lead to a respectable list of goals — maybe more goals than is practical for one business plan. Select the five goals that you think are absolutely, positively essential to your business success. (If you come up with only four, don’t worry. If you can’t get away with fewer than six or seven, that’s okay, too. Just be sure you establish a list of goals long enough to drive your success, but don’t overwhelm your ability to focus on each one.)

After you decide on your list, fine-tune each goal, using these guidelines:

• Keep each goal clear and simple.
• Be specific.
• Be realistic.
• Don’t be afraid to push yourself.
• Make sure that your goals are in sync with your mission.
• Tie your goals to objectives, using the goals and objectives flowchart in Form

Your goals become part of your written business plan. Long-range goals are wrapped into your business strategy, and immediate goals drive your shortterm action plans.

 

Exploring Values and Vision

Your mission statement and your business goals and objectives provide a road map that keeps your company moving in the right direction, but a map isn’t enough by itself. You also need a good, reliable compass — something that you can count on to keep you oriented, particularly during rocky times. You need a clear set of values and a strong vision:

_ A values statement is a set of beliefs and principles that exists behind the scenes to guide your business activities and the way you operate.

_ A vision statement is a precise set of words that announces to the world what your company hopes to make of itself. The vision statement defines your highest aspirations for your business. It explains why you’re doing what you’re doing, in terms of the greatest good you hope to achieve.

 

Why values matter

A company’s strong sense of values can guide it through troubled times and also improve the bottom line. Studies have shown that companies that recover best from man-made catastrophes and emerge with their reputations intact are the ones with the ability to recognize their responsibilities to their customers, shareholders, employees, and the public. Plenty of real-life examples illustrate just how important a strong sense of values can be when a company faces a crisis. Consider a few recent cases:

_ In 1999, certain chemicals Coca-Cola products were rumored to have made several hundred people sick in Europe, and the company was slow to respond. The governments of France, Belgium, Luxembourg, and the Netherlands had to order Coke products off the shelves — and the company, scrambling to define what caused the illnesses while simultaneously working to repair its image, issued an apology that amounted to a values statement: “The Coca-Cola Company’s highest priority is the quality of our products. One hundred thirteen years of our success have been based on the trust consumers have in that quality. That trust is sacred to us.” Had the company acted on those values faster, Coke could have spared tremendous damage to its reputation and image.

_ Most oil producers have taken a wait-andsee attitude toward concerns over global climate change. Not British Petroleum (BP). The company announced a “firm overall target” to cut greenhouse gas emissions by 10 percent of their 1990 levels by 2010. This pledge made BP the first oil producer to weigh in with a measurable commitment in this area. The move, guided by the company’s environmental values, also had a public relations payoff. The executive director of the Environmental Defense Fund called the announcement “a really magnificent example of a corporation acting responsibly.”

_ When customers discovered that Amazon. com required publishers to pay to have their books featured on the company’s Web site, they made their opinions known in a barrage of e-mails. The company responded quickly, pledging to disclose whenever a company paid to have a book featured on its site. “We’re always listening to our customers,and it was clear that our customers had a higher expectation for us than for the physical bookselling world,” said a company spokesman. These examples involve big companies, which is hardly surprising because, after all, how often does a business like Mary & Pete’s Dry-Cleaning Service make the pages of The Wall Street Journal? However, values remain important even when you’re self-employed or part of a very small company.

_ A chiropractor resigned from a large medical group, dissatisfied with the way patients were treated in the HMO setting. He opened a small practice, which soon attracted more patients than he could treat. He began tomake plans to enlarge his practice, move to a larger facility, and hire two more chiropractors, but then he stopped and took stock.

The reason he established a private practice — and one of his guiding values — was his belief that patients deserved individualized, personal care. By growing his business, he realized he would spend more time managing staff and less time treating patients. The one thing he valued above all would be diminished, so he decided not toenlarge the practice. Instead, he formed a network with other chiropractors to whom he could refer patients.

 

Uncovering values you already hold

So, what are the values that you hold for your company and your business? You can probably come up with a list off the top of your head. People tend to take values for granted — beliefs and principles that serve as a hidden  foundation for what we choose to do and how we choose to get things accomplished. One way to uncover some of your core values is to consider how you would respond to a series of hypothetical situations — situations that call on you to make difficult decisions. Read through the scenarios presented in Form 3-10, and check the boxes that best describe what you would do. Remember, these questions don’t have right or wrong answers. The whole idea of this survey is for you to get a better handle on the set of values you already hold.

 

Writing a values statement

Use your responses to the hypothetical situations in Form 3-10 as a guide when you draft a statement of the values you think are most important to your business. The statement doesn’t have to be long and fancy. In fact, a simple list, with values written as plainly and clearly as possible, is an ideal form for a values statement. When you finalize your values, record them on Form 3-11. Figure 3-5 presents a values statement created by a young entrepreneur who wants to combine his love of art and his commitment to folk artists into a  Web-based folk-art emporium.

 

OUR VALUES STATEMENT

Folk Art Bazaar is dedicated to the following values:

• Using the Internet to form a community of artists and collectors

• Encouraging the preservation of folk art tools and methods

• Offering struggling folk artists a means to make a decent living

• Educating collectors about the value and importance of folk art

 

VALUES QUESTIONNAIRE

You discover that a product you offer poses a risk if used incorrectly. You’ve already dropped it from your online catalog, and the manufacturer has promised to send out warnings to everyone who’s filled out a warranty card. What other steps would you take?

Let the matter drop, assuming the manufacturer has taken care of things. E-mail customers who have bought the product, alerting them to the problem as well. E-mail customers with a warning and an offer of a full refund, no questions asked.

An unhappy customer asks to return an item even though it’s beyond the 30-day-return and there’s absolutely nothing wrong with it. If you take it back, it can’t be resold. What would you most likely do?

Tell them you’re sorry, there’s nothing you can do after 30 days. Bend the rules and refund the money, betting on repeat business.

You have meetings with two different clients, both on the opposite side of the country. They’ve each offered to pay your expenses as well as your fees. You plan to make only one trip to the coast. When it comes time to bill out your travel expenses, what would you do?

Split the airfare evenly between the two clients, giving each a small financial break. Bill the airfare out to the client you’re least interested in working with long term. Bill each client for the full airfare, assuming this is what they each agreed to.

You learn that by changing suppliers, you could substitute sustainable materials into your product, substantially improving its environmental friendliness. Unfortunately, your costs would rise by about 25 percent. What alternative would you choose?

Continue producing the product in the most costeffective way. Switch suppliers and absorb as much of the additional costs as you can. Pass the costs along after educating customers about the environmental benefits.

You discover that a long-term supplier has been consistently under-billing you for the last five years. What action would you take?

Wait for the supplier to discover the error, assuming it’s not your problem. Correct the current bill. Alert the supplier and offer to repay all the past undercharges.

You are faced with filling a key position in your company. Where would you most likely turn?

Hire an outside person with the right job skills but no industry experience. Promote someone inside with talent and drive, and agree to train he or she in the needed skills.

 

Your are forced to let one of your team members go. Who would you tend to dismiss first?

The young, inexperienced but energetic college grad who was just recently hired. The 20-year veteran, loyal and hardworking, but somewhat set in his ways.

An employee suggests that the company institute a strict recycling program. Your offices are already cramped and you worry about cutting into productivity. What’s more, not all your employees want to be bothered with recycling. How would you proceed?

Explain that the benefits aren’t worth the costs to the company at this point. Agree to a three-month trialand then evaluate how well it’s working. Ask your employees to vote on the new program and let the majority rule.

You have a smart, creative, and productive person working for you. Unfortunately, the individual is also disruptive,often flouts the rules, and is the source of many complaints in the office. What would you do?

Tolerate the behavior, assuming a bit of tension is good and worth the results. Try to work with the person to get her to understand what absolutely needs changing.Terminate the employee to keep the office peace.

You are faced with a dilemma: Either work overtime and miss your child’s championship soccer game, or risk letting an important business deadline slip. What would you do?

Work until the project was complete, and then try to make it up to the family. Work around the soccer game, assuming things will somehow work out at your company.

An employee asks if you are willing to help defer the costs of night school courses. What would your response be?

You agree, but only to reimburse courses directly related to your business needs. You agree, but only if the employee agrees to work at least a year after course work is complete.

You agree to pay without any preconditions, assuming you’ll have a better employee.

You’re putting together a compensation package for your top managers. What sort of incentives would you most likely include?

Incentives based primarily on rewarding individual effort and performance. Incentives that promote team effort and company-wide performance.

Select the top three in terms of their importance in running your business.

Maximize company profits Satisfy customers Be as ethical as possible Create fulfilling jobs Promote new technologies Develop employees Win product-quality awards Maintain long-term growth Promote worker safety Dominate markets Protect the environment Beat the competition

 

Writing a vision statement

A vision statement is a short phrase or sentence that describes the enduring purpose of your business. To distinguish the vision statement from the other statements you find in this chapter, remember the following list:

_ Your mission statement describes who you are and what you hope to achieve.

_ Your goals and objectives set the mileposts that help you get what you want.

_ Your values statement reminds you of why you’re in business in the first place.

_ Your vision statement expresses, in the simplest language possible, what you intend your business to accomplish. This statement captures the essential reasons you’re in business: the intentions that will remain constant even when strategies and practices — and even your products and services — change in response to a changing world. As an example, return to the business venture started by an entrepreneur whose business values are listed in Figure 3-5. His company’s mission statement reads as follows:

To create an online marketplace that brings together unique and creative folk artists from around the world with serious collectors from beginner to expert.

His enduring vision statement:

To promote the continuing production of folk art and the livelihood of folk artists around the world through Internet technology. Check the ones that really grab you. You can refer to them as you write your vision. In 25 words or less, capture the vision you have for your company.

The vision you have for your company is something you should be very proud of. Make copies for each person you work with. Attach a copy to your computer monitor, and carry one in your daily calendar. Consider including your vision statement in your company brochure or on your letterhead to remind everyone of the essential reasons that you’re in business.

 

Putting Your Principles into Practice

The financial and moral bankruptcies that stole headlines through the earliest years of the 2000s shifted the public spotlight back onto the term business principles. Companies that remain devoted to nothing more than the bottom line will always exist. But, increasingly, companies are realizing that strong values contribute to strong businesses, and they craft their business plans accordingly. Use your mission, vision, and values to guide the way that your business functions as a socially responsible contributor to the world around you — to your employees, your clients, your industry, and your community. And use your business plan to emphasize your company values and what they mean to all who deal with your business Enterprise Rent-A-Car proclaims eight founding values in its corporate communications, including in its displays throughout its worldwide branch offices and on its corporate Web site under the title  What We Believe.”

An “Enterprise Cultural Compass” helps employees enact the values in their everyday dealings. And, in 2003, the company introduced a Founding Values Award to recognize branches that stand out when exemplifying the company’s vision.

Consider incorporating similar principles about trust, loyalty, ethics, and contribution in your values statement, and then create a plan for translating the words into actions whenever the need arises, following these steps:

1. Whenever you encounter a difficult business or ethical situation, assess your options in light of your values.

2. Analyze the consequences of the various actions you can take, considering who will benefit and who will be hurt or damaged by each response.

3. Weigh whether your response is honest and fair.

4. When you’re confident that your response to a difficult decision is consistent with your values and that your actions will be fair and honest, proceed with confidence.

By knowing and remaining true to your values, when and if you encounter an ethical dilemma, you’ll have a strong foundation upon which to build. And now you know how you put your values to work.