11. Establishing Missions and Strategic Planning

Establishing Missions and Strategic Planning

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ESTABLISHING MISSIONS AND STRATEGIC PLANNING

John A. Miller and Tammy Bunn Hiller

In the Storming Phase, you will contend with each other to decide your company’s mission and to develop a strategy through which you can effectively and efficiently complete that mission. Your company’s mission should provide a clear sense of direction and focus for the entire organization, and your strategy should provide a broad outline of how you plan to accomplish that mission. Your company should emerge from the storming phase with a mission and strategy statement in hand, prepared to begin organizing yourselves to achieve that mission.

MISSION AND STRATEGY STATEMENTS

Your mission and strategy statement should make clear how your MGMT 101 company is distinguished from all other organizations that have the same general purpose. The mission part of the statement should define the overall purpose of your organization – the difference your company hopes to make in the world. It should describe the nature of the service you will provide, specifically identifying your service project clients and the commitments you have made to them. It should also describe your business project, identifying intended customers, the industry you intend to compete in, and the particular niche you intend to occupy in that industry. The strategy part of your statement should explain the distinctive methods you will employ to fulfill your organization’s mission.

Two organizations with the same mission may have very different strategies for accomplishing that mission. For example, the missions of the National Resources Defense Council and Greenpeace, shown below, are essentially identical, but the strategies they employ to achieve that mission are quite disparate.

National Resources Defense Council’ s Mission: “Safeguarding the Earth: its people, its plants and animals and the natural systems on which all life depends.” National Resources Defense Council’ s Strategy: “NRDC uses law, science, and the support of more than 500,000 members nationwide to protect the planet's wildlife and wild places and to ensure a safe and healthy environment for all living things.” Greenpeace’s Mission: “To ensure the ability of the Earth to nurture life in all its diversity.” Greenpeace’s Strategy: “Greenpeace is an independent, campaigning organisation that uses non-violent, creative confrontation to expose global environmental problems, and force solutions for a green and peaceful future.”

The fundamental premise is that you are playing in a world of alternatives for people’s time and money. The strategic choices you make will determine how your company’s service and business projects are positioned relative to alternatives — i.e. your competition. If you want to attract clients and/or volunteers to engage in your service project and customers to buy your product, you need to be different from and better than the competition. This is what your strategy is all about: How are you going to be better by being different?


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A good mission statement will clearly specify service and business niches in which your organization can operate successfully. A niche is a specific market position that is based on a clearly identified client or customer need or desire. Choosing market niches involves making marketing segmentation and targeting decisions, which will be explained later in this article.

Your strategy statement should identify the basis of competition you will use in your business project; in other words, how you will create value for the customer in your product offering in a way that distinguishes it from the competition. For an undifferentiated product, such as a snack food, you can offer some feature that adds value to the product in the eye of the customer, such as providing a late-night delivery service. For other business projects, price may be the key competitive factor. Some products are very price sensitive, such that small increases in price greatly reduce demand for the product. Usually this is the case when there are many readily available substitutes for the product. For other products, like a T-shirt or poster, design may be the critical basis of competition. For still others, product quality may be the decisive feature that distinguishes your product from its competitors and adds value for the customer. One of the key differences between 101 and ongoing companies is that you are in performing mode for only about one month. So you don’t have to develop a strategy that ensures longevity – just one that works for a month!

EXAMPLE MISSION & STRATEGY STATEMENTS Below are three examples of MGMT 101 mission and strategy statements. (Note that we edited Check Out My Glass!’ statement to make it more concise.):

• The mission of Campus McPretzels is to provide a Thanksgiving dinner for

residents of the Ronald McDonald House [family members of children who are patients in the cancer unit of Geisinger Hospital] and to contribute services and funding for the Ronald McDonald House, using profits realized by the production and sale of a convenient and inexpensive snack food – hot pretzels – to Bucknell students residing on campus. We will deliver to campus residence halls a popular snack food that is priced comparably with its alternatives, and is offered during the late evening hours when the students’ propensity to munch is high.

• The mission of Barenaked Bison is to create a memorable and enjoyable

experience for children ages five through ten in the Lewisburg community by providing an opportunity for the children to express themselves athletically, artistically, and theatrically. This mission will be accomplished by putting together a holiday event at the Donald L. Heiter Community Center using funding from the profit made by selling affordable, authentic Co-Ed Naked Bucknell T-shirts.

• The mission of Check Out My Glass! is to work with the Union County Historical

Society and the Audubon Society to help restore the property surrounding the Dale/Walker farmhouse – an important historical landmark in Union County. We will also take children from the Donald L. Heiter Community Center to the restored farmhouse, and educate them about its historical importance. We will fund our service project through the sale of high quality, affordable custom glassware, distributed with alcohol awareness pamphlets and marketed to


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Bucknell students, faculty and staff. Our glasses will give Bucknellians a valuable yet useful memento of Bucknell school pride to display and use for years to come.

Note that Campus McPretzels’ statement specifies target markets for both their service (residents of the Ronald McDonald House) and their business (Bucknell students residing on campus). In contrast, Barenaked Bison’s statement specifies a service target market (5-10 year old Lewisburg children), but does not specify the customers whom the company will target. This is an important omission. The more precisely you define your target market, the more effectively you can plan your advertising, sales, and distribution efforts. If you haven’t targeted specific market segments of customers in your mission and strategy statement, you are more likely to use a scatter-shot approach in your advertising and sales efforts. You might eventually reach customers who want your product, but with the expense of wasted resources in doing so.

Note also that the purpose of the service project is much clearer in Barenaked Bison’s mission statement – to give young Lewisburg children an opportunity to express themselves athletically, artistically, and theatrically – than is the purpose of Campus McPretzels' service project. Why provide a Thanksgiving Dinner and what are the undefined “services” they say they will also contribute?

In contrast, the nature of the business has been well defined in Campus McPretzels' mission and strategy statement. They recognize that they are in the “inexpensive snack food” business, not the pretzel business, which shows that they understand their competitive framework. They will be competing against a variety of inexpensive snack foods, not just pretzels. The use of the word “popular” in describing the kind of snack food they will sell implies a conclusion that the decision to sell pretzels was demand driven, where that conclusion was presumably based on solid market research data about what snack foods students prefer.

Because there are many substitute goods in the snack food market, Campus McPretzels chose a value-added strategy. Delivering pretzels to the customer during a timeframe when s/he is most vulnerable to the whims of impulse buying adds value to the product and makes it stand out among the competition. Barenaked Bison, in contrast appears to be implementing a price and quality strategy by offering “affordable, authentic Co-Ed Naked Bucknell T-shirts.” The term “affordable” implies that the shirts will be reasonably priced relative to the competition, and the fact that the shirts are “authentic Co-Ed Naked” ones implies high quality and appealing design.

Check Out My Glass!’ mission statement differs from the other two in the scope of its service mission. This company committed itself to making a difference in the local community by meeting the needs of three very different stakeholder groups in an integrated way. The most meaningful and rewarding missions are those that are challenging and make a real difference in the world. However, your company does have limits; be aware of them. You don’t want to commit yourself to a mission that is so immense and time consuming that it overburdens and demotivates company members. Be careful about setting really ambitious goals for all three projects – Service, Business, and Report. If you choose an innovative, challenging Service project, you’ll probably be


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better off with a “standard” Business project where you can use models from past companies to help balance your load.

HOW TO DEVELOP YOUR COMPANY’S MISSION & STRATEGY Now that you know what missions and strategies are, how do you go about developing ones for your company? Your management companies differ from most ongoing organizations in that you will first form your company and then decide its mission. Most organizations form because of a mission; it’s the mission – the shared sense of a purpose that can’t be accomplished alone – that draws the people together, after which they decide the strategy to accomplish their mission. In your case, you will be doing both at once – contemplating possible missions and possible strategies to achieve them simultaneously. Therefore, choosing your mission should be based in part on the quality of the strategy that you develop for each possible mission under consideration.

The work of developing your company’s mission and strategy begins in coalitions. For each idea that your company is seriously considering as its service and business projects, the coalition associated with that idea will need to make market segmentation and targeting decisions, conduct market research, sketch out a means-ends chain for the project idea, and conduct a WUT-SOP? analysis of the potential project. Conscientiously performing this work for each of your coalitions’ ideas will give you the information needed to draft preliminary mission and strategy statements for each project idea under consideration, which then serve as the starting points for your final debates and project decisions. After your project decisions are made, the company will need to combine the preliminary mission and strategy statement drafts from the winning service and business coalitions into one company mission and strategy statement. As you work through the early stages of the norming phase, you should thoughtfully wordsmith your mission and strategy statement to ensure that it provides clear direction and focus for the company.

The work of making marketing segmentation and targeting decisions, conducting market research, thinking through means-ends chains, and conducting WUT-SOP? analyses is usually a rather messy iterative process. All four may be worked on simultaneously, or you may work on one, then another, then go back to the first to reconsider it in light of the second, and so on. For ease of understanding each of the four techniques; however, we will present each topic separately in the following sections, beginning with market segmentation and targeting.

IDENTIFYING KEY STAKEHOLDERS

THROUGH MARKET SEGMENTATION AND TARGETING

Critical to the effectiveness of your MGMT 101 company is your ability to "walk in the shoes" of your key external stakeholders – to understand their needs and desires and how they behave. But who are they? And how do you "walk in their shoes?" For purposes of your mission decisions and strategic planning, there are three groups of external stakeholders you need to think carefully about: your service project clients, your business project customers, and the MGMT 101 Board – the main clients of your company’s reports.


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The Board is easy to identify; it is your MGMT 101 instructors and TAs. Often other faculty members and/or business professionals sit on the Board during Operating Plans Presentations and provide feedback to the companies. However, when it comes to evaluating your final reports and determining company grades, the Board consists solely of MGMT 101 instructors and TAs. Identifying your clients and customers is more difficult; you have to decide who they are. The process of identifying and selecting target customers and clients is called market segmentation and targeting.

In market segmentation, you divide a large heterogeneous market into smaller, more homogeneous groups based on common needs and response behaviors. For example, you could divide your market of potential service project clients geographically by segmenting the market into clients within walking distance and those who aren’t, demographically by segmenting the market into children versus adult clients, or behaviorally by segmenting the market into clients who are able to care for themselves versus those who are not. Similarly, you could segment your market of potential business project customers geographically by differentiating between campus residents and town residents, demographically by differentiating between sophomores, seniors, alumni, and faculty, and behaviorally by differentiating junk food eaters from nutrition-conscious people. Presumably, each of these market segments reflects differences with respect to needs, desires, and responsiveness to the particular product or service you have to offer.

The next step, targeting, involves evaluating the various market segments you identified and deciding which segment (or segments) to serve. Evaluation can be done on the basis of depth of unfulfilled needs or desires of the client/customer segment, cost of meeting the segment’s needs (including money, time, and emotional demands), best fit with company members’ skills and talents, potential profitability (considering both size and price sensitivity of the market segment), social responsibility, and/or other criteria that make sense for your company.

In many cases you may decide to target more than one market segment, choosing one group as your primary target market, and a second or even third group as secondary (or tertiary) target markets. Presumably, each of these market segments will have different needs, desires, and/or behavior patterns; otherwise, why bother to group them into different market segments! These differences mean that you will need to treat your primary and secondary target markets differently. For example, you may provide different services to your primary and secondary client target markets and utilize different advertising media and campaigns to appeal to your primary versus secondary customer target markets.

Identifying whose needs and desires your company is capable of fulfilling, and making sound targeting decisions about which market segments of clients and customers you will serve is an essential prerequisite of effective business and service projects. The better you understand your potential customers/clients, the better your chances of effectively, efficiently, and enjoyably implementing your projects. Clearly, to make good targeting choices you must understand the differing needs, desires, and behavior patterns of the market segments you could potentially serve. But how do you learn that? The answer is deceptively simple. You ask them and you listen to what they say, which means conducting thoughtful market research.


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CONDUCTING MARKET RESEARCH

“Shut up and listen.” – Dale Carnegie, How To Win Friends and Influence People.

Market research is a process of gathering and interpreting information about potential market segments that you are considering targeting. The results of your market research should help you to make reasoned decisions not only about which segments to target, but also about how to design and promote your service project so as to meet the needs of your selected client market segments, and how to design, price, distribute, and promote your business product so as to appeal to your selected customer market segments.

To make these decisions, you’ll need to gather a range of market research data, including, but not limited to, the following types of information:

• Demographic, geographic, & behavioristic information (Collecting this information allows you to divide your total sample into market segments and see how those segments differ on the other information you collect.)

• Level of need or desire for your service or product • Level of awareness of / knowledge about your service or product • Attitudes toward your service or product • Behavioral Intentions (e.g. Will they attend your event? Will they buy your product?

How many will they buy? At what price? In what location?) • Design preferences of service events or product and any associated timing or price

sensitivity.

Market research in MGMT 101 usually consists of a combination of three major methods: action research, focus groups, and survey questionnaires

In action research, company members actively participate in generating and interpreting the data, using themselves as data sources. Action research is not likely to be very useful in guiding service project decisions because your clients will almost certainly be too different from you for you to be able to accurately imagine their needs, desires, etc. On the other hand, this type of research works reasonably well for basic business decisions about distribution, promotion, and some product design decisions, because company members are clearly close to their usual primary target market – Bucknell students or some subset thereof (e.g., female students, sophomores, etc.) The central problem with action research, however, is that it can be very difficult to keep enough distance between the organization’s preferences and those of outside groups; i.e., not to let member enthusiasm color the interpretation of data. Using action research alone is a very risky market research strategy.

Focus groups (also called panel interviews) are particularly useful and efficient market research techniques in MGMT 101 companies. Focus groups involve bringing together a few representative members of potential service clients, business customers, and administrators who can react to your proposals in depth. Because you can ask detailed questions, and follow up on initial answers with more targeted questions, focus groups can be especially useful ways to learn about the needs, limitations, potential liabilities, and potential rewards of working with different service client segments. Focus groups


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also allow you to learn about potential service clients indirectly, by talking to community representatives of their causes, so as not to infringe on the privacy of potential clients or raise unrealistic hopes for help that may turn out not to be forthcoming. Focus groups can also help you to create more effective marketing strategies for your business products. Product design, price, and promotion strategies especially benefit from interview techniques. Focus group research should be done both before deciding on a mission, and in greater depth early in the Norming Phase, so as to inform critical decisions about service project details and business marketing strategies. And don’t forget about focus group research for your reports projects. If you’re not sure that your reports will effectively meet the MGMT 101 Board’s needs and desires, don’t hesitate to ask us.

The final method of conducting market research in MGMT 101, survey questionnaires, is probably familiar to you from having been surveyed by past MGMT 101 companies yourself. Typically, companies use surveys during the Storming Phase to provide useful data for business mission and strategy decisions. Then early in the Norming Phase they use additional surveys to inform pricing, design, and order quantity decisions. Surveys can be a good source of market information, but they can also be quite misleading. It is common, for example, for MGMT 101 companies to get upward of 80% of the returned surveys indicating intention to purchase their product. But without adequate technical checks on the representativeness of samples or the reliability of questionnaire items (something we simply don’t have time for in MGMT 101), it would be foolish (and has proven foolish in the past) for managers to stake major decisions – e.g., ordering large quantities of nonreturnable supplies or subcontracted products – based on such surveys. It regularly happens that people say whatever will satisfy the questionnaire administrators, but will behave very differently when the actual moment to fork over the cash arrives. It’s much better to depend on common sense and past experience to supplement the questionnaire data – getting even 30% of a very short-term market is a major accomplishment for any organization.

You can avoid some problems with survey research by using careful sampling procedures. In recent years, most MGMT 101 companies have tried to generate a representative sample by using a full population sample – sending the survey to everybody in a given market segment via email. At first blush, it would seem that sending everyone the email would ensure a representative sample. If everyone responded to the survey, the sample would indeed represent the population’s views. However, the return rates on MGMT 101 surveys are nowhere near 100%. There may be (and probably is) something systematically different about the people who take the time to complete and return the survey and those who simply delete it. For example, we almost always find that a greater percentage of female than male students reply to MGMT 101 surveys. We also suspect that people who really like or really dislike a product idea are more likely to respond than those who are indifferent toward it. You will certainly want to take these possible biases into account when interpreting your market research data. An alternative to full population sampling is to use a statistical sampling technique like the random sampling one described in the box on the next page. Do not confuse this technique with intercepting people in high traffic areas, like the LC mall, and attempting to interview them. Stopping people “at random” does not result in a random sample.


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Ensuring a representative sample is a significant challenge in conducting market research. Other challenges include knowing what questions to ask, phrasing those questions in ways that elicit the real differences among market segments, having the discipline to truly listen during focus interviews and ignoring your preconceived ideas about potential client and customer groups. There is no more common — or painful — source of ineffectiveness than to realize by the end of the Performing Phase that you didn’t understand the needs and expectations of your key stakeholders.

Table 1: Avoiding Market Research Bias – Statistical Random Sampling

Good sampling procedure provides every person in the population an equal chance to be

selected in the sample, which makes us reasonably confident that the sample data represents the population from which it was drawn, without bias. If your potential target market is an identifiable group for which there is a complete alphabetical listing of names, you can use the following systematic random sampling procedure to select the sample:

The formula is i = NPC/n, where: i = sampling interval; the number of names you skip before selecting the next name on the list N = the population; the number of people in a potential target market; i.e. in the directory you will use, or in a section of the directory (e.g. faculty, sophomores, etc.) P = percent eligible; the percent of those names on your list which are valid – they haven’t moved, died, etc. (In a current campus directory, you can assume P=100% = 1) C = anticipated response rate; % of students who will complete and return the survey. n = sample size; the number of completed surveys you need to make predictions of the population from which the sample was drawn. (A minimum number for you would be 50.) To select the first name and begin sampling, take a random number from a table of six-digit

random numbers, which you should be able to find in any introductory statistics text. Use the first two numbers to select the page to start on. For example, if the directory has 23 pages and the first two digits are 73, add the 7 and 3 to get 10; start on page 10. Use the second two digits to select the column on the page. Use the convention, odd number equals far left and even number equals far right. If your random number is 26, you would add the two and get 8; 8 is even so start in the far right-hand column. Finally, use the last two digits to pick a name in that column. For example, if your number is 95, add them and start with the 14th name in the far right-hand column on the 10th page of the directory. Proceed with every “ith” name after that until you come back to the name you started with. You can then mail or email surveys to everyone in your sample, or conduct a telephone survey. Telephone surveys usually yield higher response rates than the other two methods of surveying, which cuts down on bias due to potentially systematic differences between responders and non-responders.

We encourage you to push each other in your Storming Phase debates to learn not only what market research data each coalition has collected, but also how that data was collected. How was the survey administered? What questions were asked? What were the response options? Who was surveyed or included in your focus groups? (Don’t question students only if you might want to target other segments like faculty, alumni or Lewisburg residents.) How many people responded? Although no market


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research will accurately mirror the reality of your potential market segments, some coalitions will conduct research much better than others. Don’t assume the quality of the research is the same. However, when data were collected about equally well from about the same number of people surveyed, comparative data across coalitions can be meaningful. In such a case, if 90% of survey respondents say they will buy your tongue sweeper, while only 40% say they will buy your t-shirt, that probably means something.

Be aware that when approving your operating plans proposals and grading your effectiveness at semester’s end, the MGMT 101 Board will carefully consider how you gathered and interpreted your market research data and used that data in your decision making. Also be aware that your market research will be the first public contact between your company and your potential clients and customers; it's part of your marketing strategy.

The Board structures opportunities for coalitions to conduct their first market research in the middle of the Storming Phase. This occurs for business coalitions through preliminary survey research during a discussion session, and for all coalitions through “stakeholder panel” focus group research during the following company session. Helpful hints for how you can gather information from your fellow students and stakeholder panel participants to help you make sound targeting decisions follow.

Table 2: Business Projects — Preliminary Survey Market Research Your company will have about ten minutes during a scheduled discussion session to

gather data from the students in the other project companies (and in your own company, if you so choose) using any methods you devise. (Warning: Current MGMT 101 students may not be entirely representative of market segments you anticipate targeting for your ultimate business project.) Typically, companies find it efficient to either hand out preprinted surveys or read questions — slowly and clearly — and ask respondents to use their own paper to answer. In any event, effective market research requires careful planning and preparation; “winging it” assures not only ineffective data, but it is inefficient, and embarrassing.

1. The session is for gathering information about a proposed business project’s strengths,

weaknesses, opportunities or threats, not ‘selling’ or advocating. Don't spend time trying to convince members of other companies or your peers of the merits of your proposals. Whether or not members of MGMT 101 companies will ultimately be customers, there will be many future opportunities to sell to them.

2. Provide enough information about the proposed project so that people can respond meaningfully to your questions.

3. Think carefully about what kinds of questions will provide data that will be most helpful in making your eventual mission decisions. Don't waste time asking questions you can answer better using other sources (e.g., past project reports, site visits to competitors).

4. Think carefully about the format of your questions and the desired responses, so there will be no doubt, when you read responses, about what the data mean.

5. Make sure to ask for potentially useful segmenting data — geographic, demographic, and behavioral.

6. Carefully control the agenda for your company's 10 minutes. Allot each coalition sufficient time to gather information about its project proposal, and use all of your time to learn all that you can about your proposed products.


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Table 3: Service & Business Projects — Stakeholder Panel Focus Groups Your company will have 1 hour during a scheduled company session to gather data and

reactions from a focus group of volunteers, consisting of people active in various community services, campus administrators, past MGMT 101 students, and others concerned about relations between ‘town and gown.’ (Warning: Stakeholder panelists care; they are not unbiased, representing some disinterested point of view. You should listen to, and weigh, stakeholder opinions carefully. You can expect them to tell you about particular client groups, their needs, and how to effectively address them, and to identify business product issues but the decisions you make about which clients to serve and which products to sell are yours, not theirs. Do not rely on the stakeholder panel to do your "homework" for you.)

1. The first 45 minutes of the session with the stakeholder panel should be used for gathering

information about your proposed service projects. The last 15 minutes should be used for gathering information about your proposed business projects.

2. The session is for information gathering about possible service and business project strengths, weaknesses, opportunities or threats, not ‘selling’ or advocating. It is not for trying to convince stakeholders or peers of the merits of your ideas. The panelists don't have to consent to your projects, but they might help you avoid some disasters. You will have plenty of other opportunities to convince your peers of the merits of your proposals.

3. You should therefore be prepared to briefly and concisely provide stakeholder panelists with the information they need to provide helpful feedback, while not providing them with a lot of information they don't need.

4. You should plan some open-ended questions (those that cannot be answered with a simple "yes" or "no") to which you would like the stakeholder panelists to respond.

5. Carefully control the agenda. Allot each coalition sufficient time to gather information about its project proposal. Appoint a company timekeeper to ensure that one coalition doesn’t eat into another’s allotted time. Take good advantage of the hour that the stakeholder panelists have volunteered to give to your company, but don’t abuse their kindness by going over the time limit.

Note that the Stakeholder Panel and the MGMT 101 Board are not the same thing.

Historically students have sometimes confused the two. Don’t make the same mistake. The stakeholder panel is a focus group of volunteers who care about service to the community & Bucknell’s reputation. They volunteer their time to help you conduct market research about your service and business ideas. They play no role in evaluating your company’s eventual performance. That role is reserved for the MGMT 101 Board (your professors and TAs).

DETERMINING ENDS, CONSIDERING MEANS

Analyzing the means-ends chain for each of your business and service project proposals means thinking systematically and realistically about all the steps that your company would have to take to accomplish a specific proposed mission without mishap. It does so by simultaneously attending to the realistic present and the desired future to assure that there are tight links between the real beginning and the hoped for end of your proposed project.

Organizations pursue a wide variety of goals and objectives, typically arranged in logical hierarchies, ranging from the mission (at the most general level), down to specific


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individual tasks. Each level in the hierarchy simultaneously represents the end, or purpose, or result of the activities at the next lower level and a means to the accomplishment of ends at the next higher level. Figure 1 graphically depicts this hierarchy of objectives or means-ends chain.

Figure 1: Hierarchy of Objectives = Means-Ends Chain

You can, and should, think about the logical relationships among means and ends in both directions simultaneously – “top-down” and “bottom-up;” as explained below:


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TOP–DOWN PERSPECTIVE (Comprehensive Rationality)

BOTTOM-UP PERSPECTIVE (Incremental Rationality)

If we want to achieve this mission later, these objectives must be accomplished before that, which in turn means that we have to meet these specific goals, which in turn requires doing these tasks now.

If we are doing these tasks now, these results will (hopefully) occur next; after which we would need to do these tasks, then these tasks, and so on until we have completed our mission.

In the Storming Phase, you need to consider broad outlines of the means-ends chains that flow logically from each of your project proposals. An understanding of what you would really have to do to accomplish each potential project is essential in making a well-informed mission decision. Choosing a mission – the "ends" – without also considering the requirements for carrying out that mission – the "means" – is a recipe for disaster. Later, in the Norming Phase, you will flesh out in great detail the means-end chain for the mission your company decides on. At that time, how you define specific objectives, goals, and tasks will significantly influence the efficiency of your company’s operations.

Earlier in this article we explained that an organization’s mission provides general direction and focus for the entire organization. As such, it tops the hierarchy of objectives. In the management literature, there is no uniform agreement on names for the middle levels of the hierarchy of objectives; some authors regard objectives as more general than goals, and others, the reverse. The choice of names for levels of means and ends is thus largely arbitrary, a matter of convenience in communicating with others in a particular organization. In MGMT 101, we adopt the convention of regarding “objectives” as more general than “goals.” In the following sections, we explain more fully what is meant by each of the remaining levels of the hierarchy of objectives – objectives, goals, and tasks.

OBJECTIVES

Objectives are formal statements of measurable results for each key component of an organization’s mission. Together, an organization’s objectives represent operational definitions of the mission; they define what must actually have been accomplished to justify the claim that the mission has been achieved. From this perspective, an objective answers questions about an organization’s mission such as, “When and how much of what must be achieved in order to accomplish our mission?” Examples of objectives are as follows:

• To clean, renovate, and organize the attic of the Donald L. Heiter Community

Center by November 18. • To generate revenues of $6000 through the sales of 400 long sleeved t-shirts by

April 9. • To present a well-rehearsed final oral report at 9:30 a.m. on November 26 that

receives praise and positive feedback from the MGMT 101 Board.


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GOALS

Goals are specific statements of intent that are more limited in operational scope than are objectives. Like objectives, they indicate specific results to be achieved and are anchored to discrete outcomes that are measurable and timed, but they are more focused on intermediate steps along the way to achieving objectives, and they more directly define tasks for which specific groups of people, reporting to one manager, can be held accountable. Examples of specific goals are as follows:

• To have all company members receive training about how to work with the

children at Northumberland Housing Authority before March 26. • To ensure that every company member puts in 6 hours of work at T& D’s Cats of

the World. • To receive 350 BU Swiss Army Knives from the supplier (Viktor Knox) by

November 11. • To obtain a customer satisfaction rate of at least 90% of our customers saying

they are happy with their purchase of our mugs. • To obtain a mean job satisfaction (QWL) score for all employees of 80% or

better. • To produce all visual aids for the Final Oral Report by November 22.

TASKS

Like objectives and goals, tasks specify measurable results, but apply to activities to be assigned to specific individuals. Grouped together, sets of tasks define jobs, which are specified in job descriptions. Examples of tasks are as follows:

• The service scheduler must schedule each company member for three two-hour

shifts of work at the service project. • The sales manager must conduct sales training during a company session prior

to the first day of sales. • The treasurer must deposit all cash received from sales within one working day

of sales. • The incentives and rewards manager must contact local merchants to request

donations to be used as Worker of the Week awards. • Executive committee members must announce any proposed policy change and

consult with all people affected before adopting the change.

CONSTRAINTS ON THE HIERARCHY OF OBJECTIVES

Constraints – limitations imposed on methods used to accomplish results – apply to all levels of the hierarchy of objectives. Constraints imply questions such as, “How much is feasible?” or, “At what cost?” or, “Within what time period?” For example, it might be possible to achieve the objectives of earning $30,000 by selling 3000 posters, or of building a new recreation room for the Northumberland Housing Authority, but those results could probably only be accomplished by longer-lived organizations than a MGMT 101 company. Similarly, meeting the goals of 100% on-time delivery, or “zero defects,” or less than 1% budget variances may simply be infeasible, given skill and


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resource constraints. Likewise, legal, ethical, social, political or economic constraints may preclude undertaking certain tasks.

Some constraints are internal to organizations (e.g., the particular mix of members skills, interests, and schedule obligations) and some are imposed from the outside (e.g., rules and regulations, funding limits, available markets). Given the virtually random assignment of company members to MGMT 101 companies, we expect that constraints will apply about equally to all companies.

Every task, goal, objective, and mission is subject to constraints: certain tasks are financially or administratively infeasible; certain goals and objectives are socially unacceptable; and certain missions, however feasible, are unacceptable to key constituencies. As you think through the means-end chain for your proposed projects, it is critical that you recognize and explore potential constraints on your ability to fulfill your mission. There is no point in continuing on with project proposals that would require activities that exceed constraints. Conducting thorough strategic analyses simultaneously with analyzing the means-ends chains for your project proposal will help ensure that you recognize the constraints on your project ideas.

SITUATION ANALYSIS – WUT-SOP?

Situation analysis, also called strategic auditing, will help you to combine political, administrative and social considerations as you develop your project ideas, and is a useful technique to prepare you for productive final mission and strategy debates. Although the Storming Phase emphasizes political effectiveness, involving coalition building and culminating in parliamentary debates, you need to make sure that your choices will also be administratively feasible and socially acceptable. Situation analysis helps to assure productive conflict, both among organization members and between the organization and its various constituencies, by incorporating all three themes into the process.

In MGMT 101 companies, situation analysis can be an especially useful tool for structuring policy and strategy debates in the Storming Phase, where it's essential for coalitions to prepare plans for overcoming potential threats and weaknesses. It should push you to look squarely at potential problems, rather than ignoring them, self-censoring, or mind-guarding. Your projects simply can't succeed if they don't include plans to manage around potential threats and weaknesses. However tempting it might be to cover up problems in order to win Storming Phase debates, there's no greater peril for a project than to be unprepared for the most likely challenges of managing it. You simply can't afford to make project commitments without knowing what you're in for.

To conduct situation analyses in MGMT 101 companies, we’ve developed a technique called WUT-SOP? analysis that modifies and extends a familiar strategic management tool – SWOT Analysis – to help company members select projects that meet critical Community, Effectiveness, and Efficiency success criteria. WUT-SOP? analysis borrows many of SWOT's methods and ideas, but helps to cope with some problems and ambiguities inherent in SWOT.


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The basic idea of SWOT analysis, diagramed in Figure 2, is straightforward. In selecting strategies, an organization will obviously be better off if it can capitalize on strengths and opportunities and avoid weaknesses and threats. SWOT helps to give specific detail to the general systems principle of good fit between an organization and its environment. It pushes decision-makers to identify and assess favorable internal factors (Strengths) – access to special skills or resources, or especially good managers or technologies, for example – and unfavorable internal ones (Weaknesses) – such as lack of financial, raw material or labor resources, or obsolete equipment – and then attempt to match those internal factors to external ones, both favorable (Opportunities) – such as a market niche arising from new demand or weak competition – and unfavorable (Threats) – like an evaporating market from economic downturns or new regulations. In principle, such a match would give an organization a competitive advantage – perhaps even a distinctive competence – or help it identify needs for investment or development to overcome challenges.

Figure 2: SWOT Analysis Matrix

+ —

Internal

S Strengths

W Weaknesses

External

O Opportunities

T Threats

You should conduct a situation analysis for each of the project ideas your company is seriously considering. Begin by using the very simple, original SWOT framework (Strengths, Weaknesses, Opportunities, Threats) as a preliminary checklist to analyze your project proposals and help structure decisions about strategy and policy. Think first about specific circumstances in your company's environment that would be clear opportunities that your proposed project could take advantage of — seasonal or other special events scheduled during your Performing Phase, for example, or current critical needs that you could address — or other circumstances that would present threats to your proposed project that you would need to overcome. Then think especially carefully about conditions in your company —skills, for example — that your proposal clearly capitalizes on, as strengths, or that would be especially difficult problems to overcome, as weaknesses – limited funding, for example.


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This preliminary SWOT analysis might well be enough to allow you to eliminate clearly problematic proposals, or encourage you to move ahead, but you shouldn't stop there. A careful WUT-SOP? analysis of your project proposals should force you to deal with a couple of problems inherent in using the traditional SWOT framework alone. The WUT-SOP analysis framework, shown in Figure 3, adds a third column (?) and a third row (P & U) to the traditional SWOT matrix, which addresses problems with SWOT by focusing additional, specific attention on social issues associated with strategic choices and forcing users to be specific about the managerial implications of their proposals.

The familiar SWOT framework invites decision-makers into empty debates about whether a particular circumstance – a well-organized social service agency, for example – represents an opportunity (to make significant service contributions without much managerial effort, say) or a threat (to have little opportunity to develop organizational and managerial skill, or to have to yield self-control or flexibility); it obviously can be either, depending on how you decide to commit and to manage your time and energy. WUT-SOP? analysis allows you to use the "?" column to identify circumstances that you could manage to create either a “+” or a “-.”

Figure 3: WUT-SOP? Analysis Matrix

+ ? —

Efficiency

S Strengths

W Weaknesses

Effectiveness

O Opportunities

T Threats

Community

P Passion, Pride

U Uncommitted

The "internal-external" distinction in the SWOT matrix turns out to be very hard to make in practice. Whether a particular "internal reality" is a strength or a weakness will depend on external conditions, and whether an external change represents an opportunity or a threat will depend on internal factors. Moreover, dependencies are often so tight that it's impossible to separate "internal" from "external" circumstances. There's an obvious chicken-and-egg problem around the internal-external boundary because, by definition, an organization's niche (or distinctive competence) represents an overlap between its resource strengths and the environmental opportunities it is most likely to identify precisely because of its strengths. Some authors argue convincingly that "environments" aren't simply "out there," but can better be understood as "put there" – or "enacted" – by organization members whose interests and experiences (their


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internal worlds) shape the ways they pay attention to what's "out there." As a result, you could get needlessly hung up in debates about whether a particular circumstance is an internal strength or an external opportunity, when the more important question is about whether that condition could, with proactive management, be both.

Rather than making the external-internal distinction, it's more useful to think of opportunities and threats as Effectiveness issues, and strengths and weaknesses as Efficiency issues. While it's true that opportunities and threats almost always have to do with external stakeholders (customers, competitors, and sources of capital, for example) and with environmental circumstances (distance, season, fashion) that directly and obviously shape strategy and policy decisions, it's usually also pretty clear that the support or opposition of internal stakeholder groups can also represent very significant opportunities or threats to effectiveness. Likewise, the presence or absence of resources or skills that render certain strategies more or less feasible makes it easy to translate strengths and weaknesses into efficiency issues. But focusing only on "internals" may lead you to overlook external strength or weakness determinants, like easy (or difficult) access to skilled consultants, labor pools, technologies or supplies.

Perhaps the biggest advantage of WUT-SOP? analysis, as compared with SWOT, is that the bottom row explicitly highlights issues of Community that are often critical to strategy and policy decisions. The ultimate success of an organization often rests on whether or not people really care about being involved in it, totally apart from whether that sense of identification with the community is instrumental to effectiveness and efficiency. Your analysis should pay especially careful attention to assessing your colleagues' potential sense of commitment and motivation. Do the proposed activities – the "real work" – of your proposed project have the potential for community building, or for divisiveness and alienation? How "passionate" are partisans, for and against? How polarizing will it be to win? Will selecting your project proposal make it more or less likely that "losers" can be integrated into the community? How difficult will it be to get everybody "on board"? Will the work of the project place undue (and unfair) stresses on certain people? Is your proposal likely to be the source of company members' pride? What's the risk that it could end up being a source of embarrassment or shame?

Your WUT-SOP? analysis represents both a starting point for strategic decision-making and a vital ongoing management tool for tracking strategic success even after you make your project decisions. It starts as a simple checklist and a useful framework for organizing your debate positions, but you should expect your entries into the cells of the matrix to change as debates proceed. The lines separating categories may well blur, new circumstances will need to be added and evaluated, and interactions among those circumstances will need to be managed. Beginning in the Storming Phase and continuing through the Informing Phase, it will pay you to think carefully, completely, and continuously about WUT-SOP with your projects. To get a more concrete understanding of WUT-SOP? analysis, carefully review the preliminary WUT-SOP? analysis example contained in Figure 4.


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Figure 4: Example of a Preliminary WUT-SOP? Analysis Conducted by the winning service coalition in Dude, Where’s My Hood, Fall 2001

+ ? —

Efficiency Co. members have skills

for jobs required. Past model. Low cost.

One-day event.

Staff wants event date to be one

week after Operating Plans.

Effectiveness Staff wants it.

Center needs $. Second Annual event. 1st one raised $2500.

Allows creativity.

DLHCC staff disorganized.

Don’t know if kids want to participate.

Depends on others to collect pledges/shoot.

1st one had low attendance.

Community Coalition excited about

the idea.

All company work together

on the same day.

Most company members indifferent

toward idea.

Conducting WUT-SOP? analyses, analyzing means ends-chains, conducting market research, and investigating market segmentation and targeting alternatives for each of your project proposals is the administrative work you must do to prepare yourselves for the political work of making your mission decisions.

11. Establishing Missions and Strategic Planning

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