Relationship Between Mission Statement and Company Performance

Open access

Abstract

Mission statement is a managerial tool which has the power of directing the behaviour in a company. The important question we can ask is whether the existence of a mission statement is associated with company performance or not. Findings of different studies exploring this relationship are not very conclusive. Besides, mission statements often comprise of different components or dimensions. It seems that relationship between the mission statement and company performance depends on mission statement dimensions as well. In our research based on a sample of 394 Slovenian companies we explore the links between the existences of a mission statement and its components on one side, and different measures of company performance on the other. We recognised value added per employee (VAE) as the only performance measure associated with existence or non-existence of mission statement. Besides, VAE is associated with two possible mission statement dimensions - focus on relationships and focus on company resources

[1] Amato, C.H., Amato, L.H., 2002. Corporate Commitment to Quality of Life: Evidence from Company Mission Statements. Journal of Marketing Theory and Practice, 10(4), pp.69-87.

[2] Bart, C.K., 1997. Industrial Firms and the Power of Mission. Industrial Marketing Management, 26(4), pp. 371-383.

[3] Bart, C.K., Baetz, M.C., 1998. The Relationship between Mission Statements and Firm Performance: an exploratory study. Journal of Management Studies, 36(6), pp.823-853.

[4] Bart, C.K., Bontis, N., Taggar, S., 2001. A model of the impact of mission statements on firm performance. Management Decision, 39(1), pp.19-35.

[5] Bartkus, B., Glassman, M., McAfee, B., 200, Mission Statements: Are They Smoke and Mirrors?. Business Horizons, November/December, pp. 23-28.

[6] Biloslavo, R., Lynn, M., 2007. Mission statements in Slovene enterprises: Institutional pressures and contextual adaptation. Management Decision, 45(4), pp.773-788.

[7] Buležan, A., 2008. Dodana vrednost: ali informacije o njej dopolnjujejo tiste o dobičku podjetja? Management, 3(4), pp.379-390.

[8] Collins, J.C., Porras, J.I., 1991. Organizational Vision and Visionary Organizations. California Management Review, 34(1), pp.30-52.

[9] Campbell, A., Tawadey, K., 1992. Mission and business philosophy. Oxford: Butterworth- Heinemann.

[10] David, F.R., 1989. How Companies define their Mission. Long Range Planning, 22(1), pp.90-97.

[11] David, F.R., 1993. Strategic management. New York, NY: Macmillan Publishing.

[12] David, F.R., 2007. Strategic Management: Concepts and Cases. Englewood Cliffs, NJ: Prentice Hall.

[13] Desmidt, S, Heene, A., 2006. Methodology in mission statement research: where are we, and where should we go? An analysis of 20 years of empirical research. Gent: Faculteit Economie en Bedrijfskunde, Universiteit Gent.

[14] Drucker, P., 1971. Management. Oxford: Butterworth-Heinemann.

[15] Falsey, T.A., 1989. Corporate philosophies and mission statements: A survey and guide for corporate communicators and management. Westport, CT: Greenwood.

[16] Field, A., 2005. Discovering statistics using SPSS, London: Sage Publications Ltd.

[17] Fred, R.D., 1996. Strategic Management, New York, NY: Macmillan Publishing Company.

[18] Freeman, R.E., 1994. The politics of stakeholder theory: Some future directions. Business Ethics Quarterly, 4(4), pp.409-421.

[19] Gorenak, I., Pagon, M., 2006. Vpliv organizacijskega komuniciranja na zadovoljstvo policistov pri delu. Organizacija, 39(4), pp.247-253.

[20] Greengarten-Jackson, J., Yau, S.C., Gitlow, H., Scandura, T.A., 1996. Mission Statements in Service and Industrial Corporations. International Journal of Quality Science, 1(1), pp.48-61.

[21] Hussey, D., 1998. Strategic Management from Theory to Practice, Oxford: Butterworth- Heinemann.

[22] Igličar, A., Hočevar, M., 1997. Računovodstvo za managerje, Ljubljana: Gospodarski vestnik.

[23] Ireland, R.D., Hitt, M.A., 1992. Mission Statements: Importance, Challenge, and Recommendations for Development. Business Horizons, 35(3), pp.34-42.

[24] Iseri-Say, A., Toker, A., Kantur, D., (2008). Do popular management techniques improve performance? Evidence from large businesses in Turkey. Journal of Management Development, 27(7), pp.660-677.

[25] Jauch, L.R., Glueck, W., 1988. Business Policy and Strategic Management. New York, NY: McGraw-Hill.

[26] Kantabutra, S., Avery, G.C., 2002. Proposed Model for Investigating Relationships between Mission Components and Business Unit Performance. Journal of the Australian and New Zealand Academy of Management, 8(2), pp.22-39.

[27] Klemm, M., Sanderson, S., Luffman, G., 1991. Mission statements: Selling corporate values to employees. Long Range Planning, 24(3), pp.73-78.

[28] McDonald, P., Gandz, J., 1992. Getting Value from Shared Values. Organizational Dynamic, 20(3), pp.64-77.

[29] Mintzberg, H., Quinn, J., 1996. The Strategy Process - Concepts, Context, Cases. Englewood Cliffs, NJ: Prentice-Hall.

[30] Marzec, M., 2007. Telling the corporate story: vision into action. Journal of Business Strategy, 28(1), pp.26-36.

[31] Musek Lešnik, K., 2008. Vrednote, poslanstvo in vizija podjetja: organizacijske vrednote, poslanstvoin vizija podjetja kot jedrni elementi strateškega managementa. Koper: UP Fakulteta za management.

[32] Pearce, J.A., David, F., 1987. Corporate Mission Statements: The Bottom Line. Academy of Management Executive, 1(2), pp.109-116.

[33] Peyrefitte, J., David, F.R., 2006. A content analysis of the mission statements of United States firms in four industries. International Journal of Management, 23(2), pp.296-301.

[34] Rarick, C.A., Vitton, J., 1995. Mission statements make cents. Journal of Business Strategy, 16(1), pp.11-13.

[35] Rigby, D., 2003. Management tools survey 2003: usages up as companies strive to make headway in tough times. Strategy & Leadership, 31(5), pp.4-11.

[36] Stallworth Williams, L., 2008. The Mission Statement: A Corporate Reporting Tool With a Past, Present, and Future. Journal of Business Communication, 45(2), pp.94-119.

[37] Smith, M., Heady, R.B., Carson, P.P., Carson, K.D., 2003. Do Missions Accomplish their Missions? An Exploratory Analysis of Mission Statement Content and Organizational Longevity. Journal of Applied Management and Entrepreneurship, 6(1), pp.75-96.

[38] Stone, R.A., 1996. Mission statements revisited. SAM Advanced Management Journal, 61(1), pp.31-37.

[39] Sufi, T., Lyons, H., 2002. Mission statements exposed. International Journal of ContemporaryHospitality Management, 15(5), pp.255-262.

[40] Škerlavaj, M., Indihar, M.Š., Škrinjar, R., Dimovski, V., 2007. Organizational learning culture - the missing link between business process change and organizational performance. Int. J. ProductionEconomics, 106(2), pp.346-367.

[41] Tian, Y., 2005. Being responsible to the Society. A Computer-Assisted Text Analysis of the Mission Statements on the Fortune 100 Companies' Web Sites, in proceeding of Annual Meeting of the International Communication Association, New York.

[42] Venkatraman, N., Ramanujam, V., 1987. Measurement of business economic performance: An examination of method convergence. Journal of management, 13( 1), pp.109-122.

[43] Voss, Z.G., Cable, D.M., Voss, G.B., 2006. Organizational Identity and Firm Performance: What Happens When Leaders Disagree About »Who We Are?« Organization Science, 17(6), pp.741-755.

Annals of the Alexandru Ioan Cuza University - Economics

The Journal of "Alexandru Ioan Cuza" University from Iasi

Journal Information

Cited By

Metrics

All Time Past Year Past 30 Days
Abstract Views 0 0 0
Full Text Views 1215 1050 58
PDF Downloads 542 502 44