Building Your Company's Vision by Jim Collins & Jerry Porras - Assignment Example

Building Your Company's Vision by Jim Collins & Jerry Porras (Harvard Business Review, September 1996) Companies which have reached great heights of success have one thing in common; they always have a clear vision of what’s pivotal in their organization’s infrastructure and what’s interchangeable.. The decision making regarding these changes is guided over by vision. Every other person talks about his vision or his organization's vision but over the years the term has been diversified and is real meanings have been lost. Everyone has his or her own definition of the word vision but in business terms, Vision is a framework which tells the company about where it stands, what does it stand for, and where will it stand in the years to come. Vision can be divided into two major parts Core ideology Envisioned future Both of these parts complement each other and work together in harmony. In the absence of any of the above two, a company's vision can never be clear. Core Ideology: It is the sum of the characters of an organization which form the infrastructure of the organization over the period of time. Core Ideology is the heritage the founders or other eminent members of the organization leave behind which stays with the company forever. It shows where the organization stands, what is its purpose, and why does it exists. The most fundamental part of core ideology is the purpose of existence of the organization. Core ideology is not about the market trends or the customer needs. It is an internal organizational matter and it is not affected by the fluctuations and demands of the market. In a world of continuous change, core ideology is vital for the company to hold an organization and its personnel together at all times and makes it indifferent to the entire outside stimulus which may have the potential to hinder the company’s development. HP, Sony, Disney, Motorola, 3M and many other powerful companies have had focused and clear core ideologies which helped them pave their way to success. Core Ideology is further divided into two parts: Core values Core purposes Core Value: Core values are those lasting tenets of an organization which do not require any external justification or explanation. They exist for the company itself not for the market or the customers. They do not change according to the market trends but are formed on the basis of the values and beliefs of the people working in these organizations. Core values are not strategies for success but they are a handful of principles and rules passed on to generations which helps the company to last in the ever-changing business world. They do not change frequently if they change at all. Core values remain constant during times of environmental and social change as they are values of the people working inside an organization and behold their intrinsic beliefs and insights. At times core values may be of some disadvantage to the company but as the company believes in those rules they abide by them even when things get rough. Companies mostly have three to five core values. Those organizations who proclaim that they have more than five core values are often misguided about their core values. Sometimes people include aims, strategies and purposes under the headings of core values but all these are separate entities as they may change with time. All these change with the external changes, market demands, and customer needs while core values remain the same throughout many decades. One method of finding out core values is by asking yourself simple, self-analyzing questions; like would you still stand by these rules even when they are of disadvantage to the company, or would you follow these rules even when applying them does not result in any market profit etc. If the answers to these questions are ‘No’, then these should not be confused with core values. Even organizations with people from diverse ethnic and cultural backgrounds can agree upon same core values. The assessment on individual level in these organizations can help in forming values and rules for everyone. Simple questions which spark up people's interest help them in answering these questions honestly. They should be asked, for instance, about the values they would teach their children, and/or what would they do if they had enough money without working, what values they would want to see in the people working under them etc. Individual assessment is crucial as it makes the employees feel a true part of the company and not just an interchangeable pawn. Then comes the question of giving a final shape to these set of rules. This differs from company to company as people differ from geographical, age and size aspects, The main method of formulating core values for an organization is a task comprising of a group people called the Mars Group. These are a few selected people who are acknowledged the best at what they do. These people have a strong sense of beliefs, values, and ethics. They are credible amongst their work mates and possess a strong sense of competence. They represent the company as a whole and are the essence of an organization. These selected people are the ones who formulate the core values and these values are passed down in the company without any changes, as the staff and all members of the organization agree upon those rules as they feel a part of it. Core purpose: This is the company's purpose of existence; it's reason for being. Core purpose tells us why the company was formed in the first place, what is its reason of formation and existence. An affective person not only motivates the people working in the organization, it also broadens their horizons. It is the soul of the organization; it does not just explain the current production or aim of the company but also the purpose of why this company needs to strive forward. The purpose of an organization is not merely earning revenue; money making never makes a good core purpose. A company needs something more important and deep than the materialistic need of money making. Similarly, passing goals and strategies are not included in purpose as well. A purpose is something bigger, something more meaningful, may be stretched over the span of at least a hundred years. The purpose, like the values, should be clear in the minds of the working people as a purpose is like a guiding light which sets forth an organization in a single direction. It is like a ruminant star in the distant horizon, it is always there yet you keep moving towards it and ultimately a purpose can never be truly fulfilled, but the journey towards finding that purpose is worth the struggle and is the true essence of the organization. When a purpose is not fulfilled the company never enters a stagnant zone and it is always moving towards growth and progress. Merely indicating the final product a company manufactures is not the explanation of its purpose; a purpose comes in a wider sense. It is for the betterment of the society or for providing human life with better living conditions at an affordable rate. This is a generalized view as every company has its own purpose. The role of a core purpose is to direct and guide the company towards a clear path. It is there to inspire the people working in the company and to enlighten them that earning money and maximizing shareholder wealth is not the only aim of a workman. It is the contribution towards the society, towards the humanity that counts– not the amount of money generated by the final product, once something like that is instilled into an employee’s psyche, it increases the work ethic as it makes them feel better about themselves and the organization they call themselves a part of. Formulating a purpose for the company involves nearly the same techniques as formulating the values; the assessment at an individual level shows the thinking of the workmen and the purpose of the company in their eyes. Asking them questions like what would they do with the company if they had enough money to last throughout their lives, or would they sell the company at a very high rate even though all of its positions and productions will be shutting down? These activities will reveal the honest judgment of the people with the exclusion of the money factor between them. To achieve this goal, the creative energy of the people should be channeled. In this plastic society, people will stop believing in a thing if it is proving fruitless for a long time. The purpose should be high and grand but at the same time it should be somewhat achievable so that the people do not stop believing in the possibility of such a purpose; they should be practical enough for the people to not think of it as an illusion but as a long-term target which should guide and motivate them in such a way that their confidence persists in themselves, their target should remain high, and that they should take great interest in it. The underlying fact is that a purpose is meant to inspire and it should inspire the workers or else its purpose of being will diminish. Core purposes of different companies can differ from each other and this is no reason to form hostilities between the companies. Each company has its own work environment and their agendas are not the same so their purposes can be different as well. It is not always necessary to be articulate about your purpose As long as the people working in the organization get the ideology behind the purpose, the company doesn't need to publicize its purpose statement as it just needs to sit there and orchestrate the company smoothly around it. Envisioned Future: After the point of existence of the company is clear the second part is the future achievement and aims of the organization. Envisioned future is divided into two parts: Audacious goals Vivid descriptions Audacious Goals: Audacious goals are the best way to move rapidly towards progress. Goals keep people stimulated and they work well under the motivation of achieving something. Goals should not be daunting and hanging like a sword on top of the head as these put too much pressure, and instead of working in harmony, the team spirit vanishes. Goals should be spontaneous and yet achievable so that people could shoot for the finish line and be satisfied with the outcome. Goals should be challenging and practical which would aid by striving the employees to find something more within them without too much strain. These activities boost up the morale and increase the work interest. Things could become mundane and it could also make the employees complacent if they’re not provided with another task after the completion of a goal. Small, short spanned goals are good for the team spirit but a company needs a longer goal based over 10-30 years so that it can be progressed further. The team making up this goal should be open-minded and envisioned so that it could imagine the changes in the years to come due to which the goal will remain operational and it will keep the company firing on all cylinders consistently. Vivid Descriptions: After setting the goals, the main thing left behind is providing the people with vivid descriptions. The people get tired of working under the same conditions and following the monotonous routines. Vivid descriptions and dynamic ideas are a sure way to lighten up things at a work place. Identifying core ideology is a meticulous process of discovery but setting the envisioned future is more of a creative process. It requires creativity at both the administration and working level. Depiction of company's visions in the form of slogans, pick up statements, pictures and graphics etc. will contribute a lot in raising the interest of the people. If a person tells about the aims, goals, targets, missions, and purposes at the same time calling it the vision of the company, then no one will get his/her point or show interest in their ideas. The vision should be addressed to the people in a specific way which will reach out to the entire employee’s work ethic and explain to them that what exactly does the company want for itself in the years to come? This will give the employees a sense of satisfaction as they’ll feel that they’re working in a stable and forward-moving organization. Aims of Business Aim can be defined as the attempt or plan to accomplish a goal or a purpose. In terms of business aim can be any statement a company or an organization wants to achieve over a period of given time. The time period and nature of the aim can differ from company to company. Having an aim is of utmost importance to a company because it gives a direction and a way to move ahead. Every organization has some basic aims in order to progress otherwise it would remain the same without fulfilling any purpose. So, it can be said that without an objective or aim, a company can never flourish and move further (Barrett, 2002). Different business organizations have different business aims as they all have varying infrastructures. The aims and objectives of a company are based upon the very nature of the organization itself and the varying nature of the external stimulus. Some companies aim to help people in every way possible, others take a more self-preserving move and aim for survival only by any means. Thus, it is established that business aims of different organizations differ from each other in many regards. Business organizations may have these categories of aims and objectives mainly: Strategic Productive Operational Contributive (Hiles, 2011) Strategic Aims: These are high level aims and missions, aligned with and supporting its mission. These are mainly for the survival and wellbeing of an organization. These aims are clearly planned out by credible people of the organization and they are closely followed. Deviation from these strategies is not usually allowed as this can cause a massive upheaval since the rudimentary function of it is to survive. Productive Aims: These aims are mostly for earning revenue and money. Profit maximization and maximization of shareholder wealth are the main objectives in this type. Companies which have this type of aims focus mainly on generating funds and as much money as possible from their productions. These types of companies are always on the look to expand themselves in various fields such as technology and market to enhance the production and do any or everything to increase the revenue. Operational Aims: These involve the effective and operational use of the resources of the organization. The resources are managed and utilized in an efficient method so that benefits for the organization can be produced that way. These types of companies are found to be extremely frugal as they’re extremely diligent with their resources. Contributive Aims: The companies directed by these aims are not chiefly involved with money making rather they want to contribute something to the society from their own. These are the general aims and objectives of major business organizations. It is not necessary for a company to use only one of the above mentioned rules. Every company has its own set of aims and objectives. They differ from others in many aspects, so it is quite possible that an organization might be having one or more types of the aims mentioned above at the same time. Other levels of business aims may include: Popularity and prestige Social and environmental consciousness family control These are short term goals, even though professional managers still maintain that a business firm shroud have firm and clear aims and should achieve the following objectives: The production and distribution of the product manufactured Salaries and compensations for executives and workers Psychic feedback like security, pride in work, satisfaction, recognition and acceptance conservation and enhancement of the human and physical aspects of society Effectiveness of operation and economy (Medina, 2006) According to Building Your Company's Vision by Jim Collins & Jerry I Porras (Harvard Business Review, September 1996) the main aim of a company should never be money making or revenue generation. This is a by-product of business aims and objectives but it should never be the top prioritized one as it is nowadays. The author suggests that world renowned companies like Sony, Disney, and HP etc. rose to the pinnacle of success because they didn't make maximization of wealth as their major concern. They had basic goals and missions and they stuck to those values no matter what. This faith in their beliefs and never abandoning their values led to their immense popularity and success. So according to the above summarized article the main aim of any business organization should be to stay true to their own beliefs and core values. Once the mission ahead is clear in the minds of the company's executives and workers, taking initiative will not be much hard and they will eventually be successful. Considering profit generation as the basic aim will just result in a minor success lasting for a very short time; in the longer run popularity and customer care are of more use than revenue. The aims of companies like Johnson & Johnson, HP, Motorola, and Ford etc. were not selfish and materialistic. They envisioned a future in which they will be able to continue something to the society from their own. Their main goal was to help the average man, to produce quality products at an affordable price so that they will ease the burden of the people of society they live in. Their aims were humanitarian and they achieved excellent results for their radical thoughts and actions. People opposed them in the beginning and they might have suffered great losses at first, but after some time their patience paid off and their names are alive today. When a business company is first started, the major aim of the organization is to survive. It tries to increase its popularity by being environment friendly and welcoming the customers wholeheartedly. This paves way for better interaction between customers and the company. After their establishment, the basic goal of nearly all companies changes to survival (Hollett, Oxford University Press). In such a competitive world, a lot has to be put in the front line in order to survive. After the survival of the organization is made possible, the company moves towards expanding it. After successful expansion the eventual aim is increasing profits. Most of the companies start by going in the right direction by providing benefits for the community and helping them in doing their desired tasks properly but by the time they make their place and name in the society, the company gives up these aims and starts thinking in terms of revenue, maximization of shares, and profits. This is where they go wrong as they forget about their contribution to the society and start focusing on reaping their own benefits. In 1863, the International Committee of the Red Cross was founded by Henry Dunant and some other compassionate fellows. The Swiss business man was bankrupt at an early stage of establishment of the committee but he wanted to contribute something to ease the suffering in the world. His funds were low, his personal business was in ruins, nobody was familiar with his innovative new idea and yet he set himself a goal and pursued it no matter what. He set some core values and a core purpose to eliminate the suffering of the wounded so that an injured soldier will no longer feel helpless and abandoned without any medical care. His task was gigantic but he didn't waver from his values and never tried to find an easy way out. Today the organization he founded is one of the most widely known organizations in the world and has won the Nobel Peace Prize three times. Henry Dunant did not worry about the survival, expansion, or profit generation of his organization. He just wanted to make this world a better place by helping others and giving in whatever abilities he had. This is how his organization reached the epitome of progress and success and forever inspired others to start organizations like his (Forsythe & Rieffer-Flanagan, 2007). References Barrett, R. (2002). Applied business GCSE: Edexcel. (Illuatrated ed., pp. 113-121). Nelson Thornes Forsythe, D. P., Rieffer-Flanagan, B. A. J. (2007), The international committee of the Red Cross: A neutral humanitarian actor. (illustrated, annotated ed., pp. 12-23). Taylor & Francis. Hiles, A. (2011). The definitive handbook of business continuity management. (3rd ed., pp. 54-76). John Wiley and Sons. Hollett, V. (Oxford University Press). Business objectives. (Illuatrated ed., pp. 134-161). Oxford University Press. Medina, R. G. (2006). Business finance. (4th ed., pp. 44-89). Quezon City: Rex. Read More