Aguinn
Management Consultant/business Advisor
Leolingham2000
Management Consultant
+1 Other

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hiii!!! me again. I have to study for my project steps of various HR functions. Due to this i will be sending such posts regarding various steps question today i wanted to know how mission, strategy and objectives are made. That is the various steps that will be taken by the management?
thank u
bye

Hello Sweet:

Good day--this can become a very complicated issue, but needn't be. It basically can be broken down into the component questions which all business addresses in one form or another; Who, What, When, Where, Why and How. Over the last 30 years or so of Management and Consulting, I've arrived at what I believe are the basics in this area. Let me share.

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The Mission or Vision Statement is the description of "why" a company or entity is in operation; it provides the context--the framework, as it were--which serves as the basis for the development of strategies.

Every company sees its Mission statement as it sees itself; some see long, flowing statements as necessary--for others, it's a short, well defined one sentence structure that can be memorized by everyone and used as a company "guide." When I consult with a company on development of a Mission Statement, I suggest the shortest statement possible; the longer and more detailed the statement, the less chance it seems to have for use and execution. I'm not sure exactly why this is, but it seems to be sort of an "unwritten rule" about Mission Statements.

I've been in consults where the CEO and Board actually wanted every employee to know and be able to recite the Mission statement, word for word. Please. This may be a bit over the top, but I've actually seen it in practice. If you experience this, email me and I'll send you a list of other characteristics you will find in companies which are managed in this way!

Generally speaking, the Mission Statement offers vision and a statement of goals or standards. Until a few years ago, it was generally expressed as an infinitive verb tense, "The Mission of XYZ Company is TO x, y, z." This is no longer considered a necessity, but many Managers and C-Level Execs still feel the need to develop an infinitive Mission Statement.

In order to formulate a valid Mission Statement--which should be the end result-- it's critical that one understand the business in terms of who the client is and how their needs are met.

To develop a Mission Statement without taking into consideration the client/customer focus is foolhardy, and generally guarantees that employees of the company will not take the Mission Statement seriously or use it as their guiding definition of what the company or entity stands for.

Management, to develop a Mission Statement, may poll the Board to evaluate the sum total of the beliefs of these stakeholders--both company representatives and outside interested parties--to determine the Mission of the Company. When Mission Statements are developed, they are often developed by a group representing as many different facets of the company as possible to consolidate as many different points of view as possible; a Mission Statement is never easy to develop, and--often--not all parties to the development of the Mission Statement will be pleased with all areas of the outcome of the statement.

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Objectives are established to set guideposts or targets for attainment, and are tied directly to the Mission Statement.

They are the means by which one can measure the performance of the management of the company or entity.

I have believed for some time that there are four separate characteristics of well-constructed objectives; others may add additional characteristics, but for conciseness, I'll list them as follows:

1) Objectives should address issues of importance to the company. This is not a place to discuss dress codes or vacation policies; although those are issues to be addressed in other venues, we're speaking here about issues which impact the effectiveness and competitiveness of a company in its operating environment.

2) Objectives should challenge the company and its workers, but be realistic in their approach, and be attainable. I've maintained for some time that my Clients often want to set unattainable objectives in an effort to "push" employees to perform; such action is not beneficial or useful, and may do more damage than good.

3) Objectives must be able to be measured by objective--and not subjective--means; this does not mean, necessarily, that subjectivity cannot enter into the equation, but generally objectivity is the target. Objective means is defined by clear, inarguable standards.

4) Objectives specify a time horizon for success; this horizon should be consistent with the Mission Statement.

Sometimes, we've seen Senior Management develop and promulgate a Mission Statement and then turn the development of goals over to mid range managers--whose responsibility it becomes to develop workable goals along specific time horizons or deadlines.

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Strategy is normally determined as a result of the recognition of the company's current operation; we always recommend prior to strategic development that a company complete some form of a SWOT Analysis. There are many different types of SWOT Assessments; just about every Consultant has his or her own way of conducting a SWOT Analysis, but generally the SWOT will assess the current Strengths, Weaknesses, Opportunities and Threats of a company in the context of where the company or entity currently "fits" into the marketplace or environment. You must, you see, find a method against which to measure a company against it's working environment, which helps Management craft a series of strategies against which to operate; understand, if you will, that there are a variety of strategies.

The Corporate Level Strategy defines the best business segment to ensure long term profitability and superior competiitive advantage;

The Business Level Strategy defines how the business will position itself in the marketplace using a leadership or differentiation component;

The Functional Level Strategy targets improvements in effectiveness of components of company operations. This is the area which I as a consultant so often address--many times, one key area of the company is, either purposefully or inadvertently, at issue with the goals of the company as a whole. Within large corporations we'll often find that leadership in a key business area--say, for example, marketing--is attempting to exert undue leadership over other areas--and all areas of a company should contribute in an equal manner to the success of the venture. I've often told consults that Marketing does not run the company, nor does manufacturing, nor R&D, nor Sales; it takes a balance of leadership and an understanding of the areas within an organization to make a true equal Functional Level Strategy work. Every area should feel the importance of its efforts, but should not fall into the trap of thinking that their area is most important.

Finally, there is a Global Strategy for a company; small companies often do not think of doing business outside the area in which they operate; we drive our consults to realize that there is one world and business can come from a variety of sources, and will do so--given the opportunity. How a company views its own ability to prosper in a one-world economy often determines the competitive advantage a company can command. I often use the correlation of the business of a company to Kevin Costner's classic movie, Field of Dreams. The overriding theme in that movie was that if the Costner character built the field, "he" would come back to play on it. Business is similar. If you build it, "they" will take advantage of it. It requires Management to operate with a vision and a passion to expand the business outward and upward. Once seized, the vision tends to expand exponentially.

Keep in mind that once a set of strategies is developed, there must be a way to implement and control them; performance-based management arises from this; there are corporate ethics and governance issues to address and implementation steps must be consistent, well conceived, and attainable.

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I think that answers your question fairly, and in a shorter format than using extensive examples. If you have any other questions about Mission, Strategy, and Objectives, I'll be more than happy to answer them for you...and I'm sure that there are other individuals who can express alternative views.

As to the HR function participation, HR functions within all these elements of management; HR should offer the "human" element into the Mission Statement. HR should represent the "human" or "people" side of the realistic opportunities for growth within the business, and should always "champion" the rights and obligations of employees to operate as individuals within an environment where personal input is not always valued as highly as corporate output.

If I can assist further, please let me know.

Alan Guinn, Managing Director

The Guinn Consultancy Group, Inc.

hiii Alen
thanks for ur answer it was very nice
but u know what
my prob is not to mske mission, strategy and obj but to just list out the various steps that have to tual work on them will be done by the HR dept in my company
so i have to say that who shud meet who, when, when to comunicate etc.
so basically the step by step account or procedure.
thank u

Hello Sweet:

I've not been ignoring your question/comment; I've been thinking for a few days how best to answer it.

Across the consulting clients I've dealt with in development of Mission, Strategy and objectives, the timing of meetings and the participants in the meetings vary.

Let me offer you some general guidance as to how these things happen in Fortune 500 Companies, and possibly you can integrate the experience I've had into your specific frame of reference there.

Mission Statement development is generally chaired by either a member of the Board of Directors, or the CEO/COO of the company. As I alluded to in the previous post, a committee is generally assembled with the specific objective of development of a Mission/Vision statement.

Members of most major key result areas within a company will attend and participate in the development of the Mission/Vision statement for a very valid reason: leadership of the company will want as many participants as possible to "buy in" to the Mission Statement developed.

The frequency of the development of a Mission/Vision Statement is very infrequent--it may only happen every 5-10 years. A well written and all inclusive Mission Statement should only change when the core business competencies evolve, or there is ownership change or direction.

There is a school of thought that every business should change its Mission/Vision statement every year; we find this to be overkill, and actually in the frame of reference of business, completely unnecessary. Mission Statements define the overriding aspects of what a company stands for; although the "direction" of a company may change frequently, the "Mission" of the company should remain more or less constant.

The HR function will definitely participate in the development of a Mission Statement--sometimes even to the point of coordinating and facilitating the development of the Statement.

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Strategic decisions are generally made yearly--or at the most, bi-yearly.

In most companies, the strategies are developed in conjunction with yearly budgetary planning.

It shouldn't necessarily be done this way, because the strategic decisions should not be driven by tactical budget planning, but--so often--Mid to Middle Upper Management only feels comfortable planning for 12 months at a time; there's a reason for this. In today's business climate, sometimes 12 months--especially in high tech--can seem like a lifetime.

Taking Moore's Law into consideration, the speed with which technology changes can drive management of the business charged with running those technology changes to shorter and shorter project and accountability horizons.

Human resources is involved in the strategy decisions because any changes in either the short or longer horizon employment picture will necessitate HRD review of Management Files for Management growth--and will drive HRM planning for the Human Resource function; i.e., how many new employees with what qualifications are needed; they will be hired on what time variable, and using which funds for compensation/can we find those people, hire them at what we can pay and get them adequately trained to meet the minimum needs of the enterprise?

As to Objectives, these should be developed once a year, and generally, we do advise clients to integrate them with budgetary planning. Objectives become roadmaps for HR to review, and answer more of the questions I listed in the previous paragraph in a very definitive way; if we know that we are opening a new division that will require 300 workers, when do we begin to hire and train; what do we have budgeted for training and how do we track funds spent vs. targeted spending.

Development of HR Objectives should parallel the financial budget preparation; HR itself may need additional employees and need to address it's needs.

This is one area where Zero Based Budgeting offers an advantage. We've advocated Zero Based Budgeting for some time--not because we enjoy seeing the sunset of budget programs at the end of the fiscal year so much, because we've seen a lot of abuse of those funds--but more so because you start every budgetary year with a clean slate from a budget perspective and define your needs as a component of the development of the Mission Statement, which leads to the Strategy to achieve the Mission, which, in turn, drives the development of the various departmental objectives.

Keep in mind that each objective should have a financial cost and an anticipated financial return attached to it. Even in companies that do not stress financial ROI (Return on Investment), we've found it imperative that this function be included in the process.

When I started in the budgeting process years ago at the Corporate level, I would have been horrified to have been required to determine ROI for all elements of a strategic plan, and even more horrified to have to develop the ROI for each objective--now, running my own company, it's a matter of simple form.

If a company does not know what it spends to achieve what it wants to achieve, it will not be successful in the long term.

I believe the same about HR. We must understand the strengths of our HR employees, and utilize those strengths. Where we know that specific HR employees have weaknesses in specific areas, it is contingent upon us to find methods of training/learning which will assist them to turn those weaknesses into strengths.

As to applying specific time horizons and specific HR functions to attend to the Mission, the Strategy and the Objectives, feel free to use these general guidelines--but be sure to take into consideration the individual company characteristics and expectations.

Hope that's helpful.

All the best.

Alan Guinn, Managing Director

The Guinn Consultancy Group, Inc.

CORPORATE HR STRATEGIC PLANNING.

Hope my understanding of your question is clear.

In most companies, HRM is part of senior management.

HRM makes contribution to the development of

-corporate mission statement

-corporate objectives

-corporate strategy.

Normally the senior management team or TOP management would

consists of

-ceo or managing director

-corporate planning manager

-finance manager

-marketing manager

-manufacturing manager

-sales manager

-supply chain manager

-HR manager

etc.

STEP 1[a]

TOP management would

-evaluate the current [ last 12 months] performance against the

objectives / target set previously, which includes return on investment,

profitability , etc and also the performance of various departments

like marketing, sales, HR, manufacturing, etc etc.

STEP 1 [b]

TOP management will also evaluate the current mission,objectives,

strategies and policies.

-----------------------------------------------

STEP 2[a ]

CEO or MD will take the summary of the evaluation of the current

performance to the board for review.

STEP 2 [ b ]

Based on the review plus the external environmental factors,

the board will make decisions on

-new mission statement

-new corporate objectives

-new corporate governance

-------------------------------------------------------------

STEP 3 [ a ]

TOP management will scan and assess the company's

external environment --political/ economic/social/ technology.

to determine the strategic factors that pose as

OPPORTUNITIES / THREATS.

STEP 3 [ b ]

TOP management will scan and assess the company's

internal environment --structure/ culture/resources etc

to determine the strategic factors that pose as

OPPORTUNITIES / THREATS.

STEP 3[ c ]

TOP MANAGEMENT will analyze the the strengths / weaknesses

of the organization and pinpoint the problems areas that needs

attention and the strengths that could be exploited.



STEP 4

Based on the above analyses, TOP management will generate,

evaluate, and select the best strategic factors.

STEP 5

TOP management will review and revise [ if necessary ] the

mission statement and corporate objectives.

STEP 6

TOP management will generate and evaluate strategy alternatives

and objectives.

STEP 7

This final corporate mission statement, objectives and strategies

becomes the foundation information for the various departments

to work out their departmental objectives/strategies/plans.

STEP 8

After working out their respective objectives/strategies/plans

and the budgets , the departmental managers send their

respective information to the TOP management for

approval.

STEP 9

On receiving the approved package from the TOP management,

the departmental managers develop the implementation plan.

STEP 10.

NOW you have mission/objectives/strategies/plans/budget/schedules.

================================================== ====

IN case of HR, which is a department by itself,

This final corporate mission statement, objectives and strategies

becomes the foundation information for the HR department

to work out your departmental objectives/strategies/plans.

STEP A

Discuss with the various other departments like sales/ production/

distribution/accounting/ IT etc about their requirements

-for manpower

-recruitments

-replacements

-training

etc etc

Once you get their departmental requirements, HRM develops

-recruitment /selection plans / programs/ procedures/ priorities



-training plans / programs/ procedures/ priorities



-rewards plans / programs/ procedures/ priorities



-development plans / programs/ procedures/ priorities



-payroll plans / programs/ procedures/ priorities



- performance management plans / programs/ procedures/ priorities



-staff/organization communication plans / programs/ procedures/ priorities



etc etc U

-HR POLICIES

-HR PROCEDURES

-HR PRACTICES.

ETC.

HOPE THIS IS USEFUL TO YOU

REGARDS

LEO LINGHAM

Dear LEO LINGHAM Its very good posting :)Can you provide me the formats of budget of all departments of a manufacturing company. (pharma) Regards Manvinder
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