No Mission Statement? Why It’s Costing You Money, Happiness and Strategic Direction

You’re packing up the last of your holiday decor; swearing off sweets, fried foods and alcohol for the rest of the year (or at least the rest of the month); and you’re ready to open your laptop to get back to business. Which can only mean one thing—it’s a brand new year. And new years bring new goals. But before you sit down to write out your list, take the time to do the one thing experts say will help you work happier and make more money: write a mission statement for your business.

What is a mission statement?

Before we dig in, let’s quickly recap what makes a good mission statement. According to Jennell Evans of Psychology Today, a mission statement “defines the present state or purpose of an organization and answers three questions about why an organization exists.”

A good mission statement includes:

  • WHAT your business does
  • WHO your business does it for
  • HOW your business does what it does

Sounds simple, right? Coming up with a well-written mission statement doesn’t have to be hard. It does, however, require—and deserve—some thought. So how do you ensure you don’t end up with a dry mission statement? Think about what makes your business unique. And don’t be afraid to let your business personality shine.

Jørgen Knudstorp, the former LEGO CEO who turned LEGO’s struggling business around, offers the following advice:

You really need to think hard about some simple questions, and those are: Why do you exist as a company? What’s the really compelling reason why you exist? Of course, ultimately, you want to come up with something that’s hugely relevant, and at the same time, very unique and really value creating for other people.

Why are mission statements important?

Understanding why mission statements are important will help you craft, or refine, your own. Here are three very good reasons why every business, including yours, needs a mission statement.

A well-written mission statement can help you:

1. Find meaning and greater fulfillment

Whether you’ve been running your business for years or just getting started, it’s crucial to remember why you do what you do. It’s a source to pull from when the going gets tough or when you’re trying to strategize on how to expand.

That’s where a mission statement comes in. Taking the time to write your mission statement can help you uncover the deeper meaning behind your day-to-day operations. And finding meaning in your work, of course, leads to greater engagement and feelings of fulfillment.

“If people are sad or angry about their work, they won’t care about doing it well. If they are happy and excited about it, they will leap to the task and put great effort behind it. The same goes for perception. If people perceive the work, and themselves, as having high value, their motivation will be high,” write researchers Teresa Amabile and Steven J. Kramer.

So how do you find meaning and value in your work?

According to the Harvard Business Review, people find meaning from three sources, which spiral out from the:

  1. Self (providing for one’s family; making progress in challenging work)
  2. Community (having a positive impact on customers; contributing to one’s community or country)
  3. Society (serving society; helping people around the world).

Think about your business’ impact on all three areas. A good mission statement touches on all of them. To see how it’s done, let’s take a look at Starbucks’ mission statement:

To inspire and nurture the human spirit — one person, one cup and one neighborhood at a time.

The mission statement includes Starbucks’ impact on the lives of customers (one person, one cup), community (one neighborhood) and the world (inspire and nurture the human spirit).

Sitting down to craft a well-articulated mission statement can help you better understand the impact of your efforts, so you can do your best work.

2. Increase business performance and earnings

One study found that companies with employees who have a strong sense of purpose and clarity around their work exhibit higher future financial performance. No surprises there, right? People who feel like they’re working for a greater cause and understand the impact of their work work harder and smarter. And organizations filled with these types of people push business forward towards greater financial gain. To gain clarity for your own business, nothing’s better than sitting down and putting words to paper in the form of a mission statement.

3. Follow a North Star

To summarize what we’ve learned so far, mission statements can help us find meaning in our work so that we do a better job and get better results. Now, let’s get back to the idea of goal setting. How do mission statements and goals fit together? Your mission statement acts as a North Star to guide all aspects of your evolving strategic, operational and management priorities. It helps you focus your goals on what’s most important to you, your business and customers. And as a result, all of your goals should ladder up to your mission statement. It makes it easier to course correct when your business goals starts to veer off track.

Real-life example:

Following a mission statement helped Starbucks CEO Howard Schultz get “back to basics … upon his return to the troubled company in 2008. During his eight-year absence as CEO, Starbucks had embarked on an overly ambitious expansion effort, at the expense of maintaining the unique customer experience that had always distinguished the brand. Commenting on his most critical turnaround challenge, Schultz sought to address ‘how to preserve, and hopefully enhance, the integrity of the only asset we’ve ever had as a company, our values, our culture, and guiding principles, and a reservoir of trust with our people.’ Schultz engineered a remarkable turnaround through the teeth of a severe recession, by investing in restoring the confidence and capabilities of his workforce, improving the signature ambience of his stores and doubling down on Starbucks’ brand promise ‘to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.’”

By using its mission statement as its guiding principle, Starbucks set goals that brought the brand back to what it does best. One look at its climbing stock prices below and it’s easy to see Starbucks’ strategy paid off.

Mission Statements: Better than a New Year’s Resolution

Whether you want to get more bookings this year or streamline your business, a mission statement can help you figure out how you’re going to get there. It not only helps you find greater meaning in your work, but helps you do your job better and with more focus.

Get Your Own Mission Statement 

No mission statement? No problem. Try our free mission statement generator. It’s fast, free and easy. Just follow the prompts (fill-in-the-blank style) and our handy tool will create a unique mission statement just for you. 

mission statement generator

Sobrina Pies

I’m a HoneyBooker—writing about small businesses, the people who run them, and tips and tricks to help them grow—and a lifestyle blogger at Quiet Like Horses, sharing stories, not small talk. HoneyBook helps you manage your business all in one place, from sending proposals, invoices and contracts to managing your projects and getting paid. Want to give it a try? Start a free HoneyBook trial here.  

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