Today’s companies are faced with an exponential amount of change. Mission statements, goal setting, and planning methods of the past are no longer producing acceptable results. Successful companies are now achieving breakthrough objectives through utilizing a technique of discovering their core ideology, stimulating progress through an envisioned future, and seeking support by the alignment of intellectual capital. Mission statements are becoming more than a series of manipulative words arranged to have a soothing tone. They have become statements of vision, and the companies who adopt this technique are becoming visionary companies.
Visionary companies depend on a core ideology, which consists of values and purpose. Values are internal beliefs that establish guidelines and provide endurance. They are everlasting, and never compromised despite external forces, such as management fads or economic conditions. They should create energy and motivation in employees, and come before company administration policies and procedures. Values cannot be copied from one company to another, because they are grown internally. A simple value such as “putting the customer first”, should not require justification, however, it should generate inspiration to all. Successful companies need only operate with a few core values. While goals and plans are constantly being developed to adapt to a changing world, values remain unchanged to provide the guiding principles of visionary companies.
Purpose on the other hand, is the organization’s reason for existence. It acts as a motivator towards progress and inspires the achievements of the goals and strategies it sets for the future. Unlike goals and strategies, which may be achieved over a passing of time, a companies purpose is to be constantly pursued, but never fully realized. As Bill Gates continually makes new advancements in creating more powerful software for computers, the world will always have a place for Microsoft, and it’s purpose. As a visionary company, Microsoft’s purpose, “creating software to improve peoples lives”, is what motivates them towards progress (1998). Organizations must clearly state their core purpose in order to invigorate employee commitment. Many employees feel that a company only exists to earn shareholder value. Employees must be motivated to participate and they must believe that their efforts will allow the company to make a contribution to society. Generating wealth for shareholders alone does little to motivate employees. According to Collins and Porras, “Today’s companies more than ever need to have a clear understanding of their purpose in order to make work meaningful, and thereby attract, motivate, and retain outstanding people” (1996, 71).
Visionary companies who have defined their core ideology must maintain it and stimulate progress through an envisioned future. Big Hairy Audacious Goals (BHAGs), are one way in which a visionary company can stimulate progress. BHAGs are nothing more than bold mission statements acting as a very powerful motivator. Unlike traditional mission statements, a BHAG does not require a strategic planning committee to spend tedious hours massaging words into sentences, which are difficult at best to understand by the average employee. BHAGs, by contrast, appear so daring that they seem almost unbelievable, however they are understood with little effort. Their understanding creates a high-energy feeling of compelling participation. Employees who can relate to core ideology through a BHAG will be more likely to behave in a supportive fashion towards the overall goal objectives of the company. BHAGs essentially motivate a company to “shoot for the moon”, although in reality they may only “land on a star”. Many visionary companies do indeed, “land on the moon”, because of their intrinsic belief in their BHAG. Visionary companies must create a brilliant image in the minds of their employees of what it will be like once the audacious goal has been achieved. Collins and Porras agree that, “The envisioned future should be so exciting in its own right that it would continue to keep the organization motivated even if the leaders who set the goal disappeared” (1996, 75). Audacious goals must also bring forth audacious commitment. Once a BHAG has been achieved, visionary companies should not stop, but should create a new BHAG in order to maintain the stimulation of progress toward the future.
Many organizations have powerful intentions but have a misaligned means of attaining their envisioned future. Companies who have strategic plans that are dated and no longer support the organizations future, will not create a clear and compelling vision to foster employee commitment to long term goals. Companies must develop conceptual vision to allow the sum of their parts to work together, in alignment, to the benefit of the whole organization. Alignment must be sought through strategic, tactical, and operational goals. However, most important, is the alignment of intellectual capital. Supporting a statement of vision through the alignment of intellectual capital is the process of motivating employees to commit to the core ideology over the long term. As Dave Ulrich explains, “Skilled employees who are committed to business goals are a companies most important asset” (1998, 15). Alignment of intellectual capital may be achieved a number of ways, including factors such as a developed corporate culture, employee participation, and motivational incentives.
A developed corporate culture includes the work environment, any norms, myths, ceremonies, stories, and styles of management. Culture defines how goals get accomplished within an organization, and enables employees to work toward a shared vision. Visionary companies usually maintain an open culture in which planning is decentralized, and employees are encouraged to be creative, experiment, and continuously improve. Culture shapes employees, and allows them to have a desire to work for an organization by displaying criteria that are compatible with their own. Employees are made to feel as if they are an integral part of an elite group that can accomplish the company’s statement of vision. Many companies such as Southwest Airlines, and Wal-Mart have created a culture enforced by having fun and celebrating accomplishments. According to David Ulrich, “Establishing, striving for, and accomplishing goals should be energizing, exciting, and worthy of celebration” (1998, 17). By contrast, many non-visionary companies have taken the fun out of their culture by imposing management styles that do not reinforce an acceptable work environment for employees. Employees generally work better under less supervision and when given more freedom. Many managers however, deprive employees of autonomy and make them feel undervalued. “90% of all managers treat subordinates as though they were members of an in-group while they assign others to an out-group” (Manzoni and Barsoux, 1998, 103). This type of relationship is often compounding and becomes worse over time. As a manager plays favorites with employees, they unknowingly increase supervision on those they perceive as being weak. The weaker employee views this as a lack of trust and feels that his performance cannot live up to the expectations of the manager. Managers usually do not realize what they are doing and often believe they are helping by providing more supervision to the weaker employee. The employee often seeks comfort among co-workers who are more sympathetic, which in turn, tends to bring down the whole team. The strength of teamwork is an important asset to a company pursuing a shared vision. Studies have shown that, “…teams can often leverage individual talents into collective achievements” (Ulrich, 1998, 22). As opposed to focusing on the goals at hand, the team wastes valuable time and energy on internal problems. Visionary companies strive to avoid such problems by creating a comfortable working environment and being cautions of treating employees as equal as possible. Those employees who do not fit in the tight-knit culture and work environment usually end up quitting on their own terms.
Alignment of intellectual capital through the practice of employee participation creates commitment. By involving employees in creating a shared vision through goal setting, motivation is increased because employees feel that they have value and their ideas are wanted. When employees participate, they create an environment in which they want to work. Through participation, employees assume a greater role of goal acceptance because the goal is perceived to be personal in relation to the task performed. Robert W. Renn confirmed that, “Employees who were allowed participation in setting performance goals reported greater acceptance of their goals than did employees who were only permitted minimal participation in the goal setting process. Furthermore, employees who reported greater acceptance of their performance goals outperformed their counterparts who experienced lower goal acceptance” (1998, 122)
Alignment of intellectual capital through various motivational incentives such as training programs, and pay programs, help visionary companies maintain employee commitment. Many visionary companies are aligning employees through motivation by offering training programs and educational assistance, which also challenges job boredom and frustration. “The more things people know how to do, the more things they will be motivated to do” (Wolfson, 1998, 5). Acting as an incentive to create motivation, training programs can be as detailed as offering computer training courses, or as broad as paying for college education towards a specific degree. These types of programs allow the employee to feel like an important asset to the company, and will in turn benefit the company by having a more skilled workforce. Some companies value training so much that they make it mandatory in order to receive a full years salary. At Saturn Corporation for example, “Everyone from the president on down receives 92 hours of training a year, …the company withholds 12 percent of each employee’s pay, which is earned back by meeting training requirements” (Dutton, 1998).
Another incentive used to create a shared vision by increasing employee commitment is through pay programs. Many companies have adopted a pay-for-performance environment, which bases merit increases on how employees achieve their planned goals. By creating such a system of appraisal, the integration of company and personal goals provide a desired objective. People feel good about themselves and their employer when they do things that stretch their abilities and when they get recognition for those achievements. Employees, who perceive salary increases as arbitrary awards, do not believe that their personal involvement in the company’s goals will result in any personal benefit. On the other hand, they can be highly motivated if their salaries are related to carefully judged and documented job performance. A modern approach to motivate employees using the merit pay system, awards higher percentage increases to employees in lower salary ranges. Lower percentage increases are then given to employees in higher salary ranges, along with the possibility for a cash bonus for high goal achievers. “The strategy behind this method is to enable the company to meet its business goals and be successful” (Sunoo, 1996). Many employees become frustrated in their belief that no matter how hard they work toward accomplishing their goals, they will always receive the standard percentage of merit increase, with little variance from year to year. The cash bonus award based strictly on goal accomplishment creates motivation for such employees and therefore encourages participation. Employee stock ownership programs, are also very effective motivators, which share the wealth while sharing the vision.
Because not every good manager has the power and influence to change an organization’s mission statement, they may look at creating a statement of vision within their own department. The principles will work the same, only on a smaller scale. It is important to realize that while visionary companies may be able to secure and maintain values and purpose, there is not one set method of stimulating progress. A BHAG is only one dynamic example of how companies arrive at their long tem goals. Companies are constantly developing their own methods that may prove just as unique and effective. In seeking support through the alignment of intellectual capital, companies must also discover any other mis-alignments that may be present and attempt to organize them. Creating culture, participation, and motivation of employees is by far the most difficult and most important task when creating a statement of vision. With the support of the company’s most important asset, the vision will be shared, and the company will ultimately achieve breakthrough objectives.
References and Bibliography
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