This was a hard chapter to write. It feels like a chapter that would work better in the final book. You have to have a mission and strategy and plan, right? So why does writing them feel like one of those make-work projects you have to do to keep investors happy? Come to think of it, you could outsource the production of your vision, mission, and strategy via Mechanical Turk?
Seriously though, when Lou Gerstner, one of the great business leaders of all time, took over the (at the time) highly troubled IBM, he proclaimed, "The last thing this company needs is a vision." He was right. IBM needed a cultural transformation, and he provided that, as memorably recounted in Who Says Elephants Can't Dance. Nothing is worse than those scripted vision and mission statements that sound like they came from a corporate-speak random buzzword generator.
Dig a bit deeper, though, and you'll find that vision, mission, and strategy are essential. They don't even have to be clearly articulated. They just have to be real and executable. Lou Gerstner probably did have a vision, mission, and strategy; he was just so focused on the urgency of the execution that he did not have time to articulate them.
Vision, Mission, and Strategy
Vision: "I see a world where..."
Mission: "In that world, we intend to..."
Strategy: "We will achieve this mission by..."
Finding a Real Vision Thing
There are four types of startup visions:
1. Fantasy. This is more like hallucination; it does not relate to reality. It may sound fun, but is not useful for starting a business.
2. An extrapolation of current trends. A vision is really about seeing into the future. This is not totally impossible. The trends are visible today, even if the timetable is uncertain. Moore's Law was a reasonable predictor of everyone having a PC.
Distinguishing between #1 and 2 is hard. The next chapter, "Finding the Right Wave to Ride (Secular Trends)," is designed to help you think this through. But in the end, you will have to trust your gut, which is sometimes right and sometimes wrong! Extrapolating trends can go totally wrong. So, agility is a prized trait among entrepreneurs. Startup success stories are full of entrepreneurs who start with one vision and mission and then change them when they discover the reality of the market and find that the real need is different.
3. Inspiration for your stakeholders (i.e. employees, investors, clients, partners, etc). This is really about the mission based on the vision. "Come on, folks. Charge! In this direction..." This is a polished version of the rather hazy vision and mission of the original founders.
4. Lipstick on a pig. A company stranded on the wrong side of a trend (e.g. buggy and whip manufacturers when the automobile came out; gas guzzlers and print magazines today) will often attempt to devise an inspirational vision and mission statement... because "Squeeze as much cash out while we still can" is not inspirational.
Most people can instinctively tell the difference between #3 and 4.
The idea has to be one that just won't leave you alone. Such ideas often seem totally out of sync with current reality and are dismissed as crazy. That is because in the current environment they are crazy. The idea that everybody would own a PC was crazy in the 1970s, when Microsoft was starting out. People who are driven by these ideas very often feel doubt. On all sensible levels, the idea is crazy.
Insanely Great Products
"Insanely great products" make your jaw drop and make you shout "Wow" and believe in magic.
Insanely great products create their own markets. They have to key into real needs, and the products are enabled by technology changes, but the creators sidestep the whole vision, mission, and strategy thing. They just create an insanely great product and launch it, and it catches fire. In hindsight, this is labeled "genius."
Great Companies Without an Articulated Vision or Mission
There was once a highly successful entrepreneur who met with investors. His business was already a big success, highly profitable and growing like a weed. He had done it without a dime of external financing, but had taken 10 years to do it. This was no overnight success story. One of the investors asked him to describe the vision and mission that drove him in the early days. The entrepreneur replied, "I wanted to buy lunch."
He was actually not trying to be funny. He had arrived in the US without any money or connections. He was simply doing the one thing he knew how to do so that he could earn enough to live. As it happened, that one thing he knew how to do was part of a huge trend, and so he was perfectly positioned. He was also super-smart, hard-working, and tough.
There was another great entrepreneur who built a business over the course of 20 years and sold it when his market turned out to be "hot." He would joke about how smart he was 20 years ago in seeing how hot his market would become.
These entrepreneurs did have a vision and mission that guided their actions. They simply did not articulate that vision and mission because (a) they were not that way inclined, and (b) articulating a vision and mission did not serve any useful purpose.
Mission Without Strategy Is Just Bombast
Strategy: "We will achieve this mission by..."
You could fill a library with books about strategy. In the startup game, the simplest way to think about strategy is as leverage. Not debt leverage (although that may be appropriate, even if currently out of fashion). Think rather of a lever.
"Give me a big enough lever and I can move the world." -- Archimedes
Startups need a lever to compete with big entrenched companies. That lever may come from software or people or something else. The other way of thinking about the lever is by looking at what VCs call "unfair advantage." You have to be able to clearly see your unfair advantage.
Some ventures start with a clear view of their lever, but without a clear view of how to use it. They have faith that if their vision of the future is right and the lever is real, they will figure it out. Google launched a better search engine (the lever) without a view of how to use it to make money, and it is now the poster child for this approach. As with most poster children, though, its massive success eclipses the countless others who have tried the same thing (i.e. started without a clear view of how to use their lever) and failed.
Strategy – Plan = Hot Air
Building a company is like building software: it is an iterative process. Once it is all complete, then the architecture and design are clearly visible. But it did not start out that way. Nor is the progression linear. The progression from vision to mission to strategy looks clear. In reality, it is a creative process and therefore messy, chaotic, and non-linear.
However, the "planning" bit is separate. The type of people who are good at creating a vision, mission, and strategy are often not good at planning and executing them. Which is why we're keeping that for a separate chapter.
Image credit: Michelle Ho.