You own a business? You need to develop a Corporate Philosophy
Corporate Philosophy?
what is that?
That is an excellent question, Corporate Philosophy basically refers to the central blueprint upon which the management of the company relies to operate and how it wants to orient itself in the market in the long term, it derives the corporate culture and is comprised of the following:
Mission Statement
Vision Statement
Value Statement
Studies show that in the past 20 years, companies with clearly defined Corporate Philosophy have performed better than those that have no defined Philosophy, it serves as a gospel so to speak.
Let’s explore what each of the elements of Corporate Philosophy contributes to a company.
Mission Statement
It’s an explanation of why a company exists, and how it plans to serve its stakeholders (customers, employees & investors), let’s take a look at Amazon’s mission statement:
“To be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavor to offer its customers the lowest possible prices”
Amazon’s mission statement is effective, let’s break down what it covers:
What do we provide? (Online Shopping)
Who are our customers? (Online Shoppers)
What is the benefit? (Find everything online at the lowest possible price)
What is important to us? (most customer-centric company on Earth)
To be effective, mission statements should be circulated within the company, so that employees internalize them and understand the company’s purpose.
Vision Statement
Is an announcement of the company’s aspiration, it answers the question, “What do we plan to become”
Google’s vision statement is “To provide access to the world’s information in one click”
Vision is the bridge between mission and strategy, vision statement provides a big picture of where the company wants to go.
A vision statement should be:
Ambitious
Brief
Expressive
Unique
Value Statement
Is a set of declared beliefs that the company adopts.
A value statement can be divided into 4 categories:
Permission-to-play values: Convey the bare minimum of behavioral standards for employees.
Core values: Serves as a company’s cultural backbone, they often mirror the founder’s values and cannot be compromised.
Accidental values: Arise spontaneously from current employees’ personalities and interests, they are not cultivated by leadership, Accidental values can be beneficial, but detrimental ones can also arise, like exclusivity and cliquishness.
Aspirational values: Values essential to a company’s future success that it currently lacks.
The process of choosing a company’s values is complicated and includes a lot of brainstorming by C-Suite executives to embed the values into the company’s culture via integration into processes for interviewing, managing and even dismissing employees.
Author: Salam Alsanawi
