The Vision Statement Development Cycle: Lessons From CEOs

When I use the term “vision statement,” people often roll their eyes and respond with something like, “I think my company had one of those once. I can’t remember what it said. We pretty much ignored it.” 

The chances are that those same companies spend large amounts of time and money on various best practices and programs, such as six sigma, employee training, and reorganizations. The reality is that any performance improvement program will likely be ineffective if does not align with the company’s stated and implemented vision.

Decades of scientific research show that a vision statement—a formal description of a desired, long-term future state—positively impacts organizational performance, including profit and revenue growth. Perhaps more importantly, writing and implementing an impactful vision statement can be done without investing in expensive consultants, technologies, or systems.

Despite considerable research on a vision statement’s impact, we know little about how and when to create one. To begin to address this need, I interviewed 30 leaders, including CEOs, Presidents, and founders of successful companies, on the process they used to write their vision statement. From the interviews, I identified five stages that comprise a vision statement development cycle (see Build a Better Vision Statement, 2016, for complete details).

Stage 1: The Uncommunicated Vision

At Stage 1, the leader finds inspiration for forming a company and has an ideal future in mind without formally stating that future. Without an initial inspiration for forming a company, the leader would not have been able to formulate and communicate a formal vision statement.

One source of inspiration is problems experienced in daily life. Dwight Gibbs was a drummer in a rock band who was in charge of ordering all equipment and supplies, such as speaker cables, drumsticks, and t-shirts. Requesting and organizing quotes in spreadsheets was unnecessarily time consuming. Later in his career, he served as CTO for several companies, including co-founding The Motley Fool, and experienced the same frustrations.  Gibbs states:

In my role as CTO, I would get requests for laptops, servers, storage, software, and other equipment we needed to buy. The requests for the stuff people needed were constantly coming across my desk. I was dealing with RFQs [Requests for Quote] again! This time, when quotes came back, they could be 500 lines long or more. I had to put all this information into Excel to compare the quotes. All I could think was — it should not be this hard!

Gibbs founded Contraqer, a procurement software firm, for which he later (at Stage 3) created a brief, memorable formal vision statement, “Friction Free Procurement.”

Another common source of inspiration was finding unexpected initial success in business. Some leaders pursued their passion without initially giving much thought to turning it into a business. However, their friends and colleagues observed their success as well as passion, and prompted the leaders to re-assess their aspirations and see potential in their businesses.

Clate Mask, co-founder and CEO of software firm Infusionsoft, didn’t initially realize his company’s full potential. He stated,

When we started, we had no intention of building a big business that would need a vision statement. We thought it would be a small company that we would sell after a few years. We went through three years of brutal survival, and then some modest success for a few years. At that point, we started to see that we were onto something really big.

A consultant prompted Mask and his co-founders to change their thinking when the consultant asked why they weren’t “going for it” to grow the company. That challenge helped them decide that they wanted to build a company that was “big and impactful.”

Some leaders drew on their early career experiences and used their company to find better ways to do things. Celeste Ford worked in engineering firms before striking out on her own to found Stellar Solutions. For Ford, “the vision statement was a natural evolution of being in the industry for many years and seeing what worked and didn’t work.” Ford’s vision remains untouched 20 years later—“To satisfy our customers’ critical needs while realizing our dream jobs.” Clearly, one lesson that Ford applied to Stellar Solutions was a dual focus on customers as well as employees. Ford “wanted to build a built-to-last, not a built-to-flip or sell, company.” 

Stage 2: Unstated yet Implemented

At Stage 2, the leader implements an unstated vision. The leaders I interviewed and who experienced this stage did not formally state their vision for several reasons: they had not found the right words, were too busy running the company, or did not initially see the importance of stating a formal vision.

Andy Hunn, CEO and founder of Resonate Insights, held several positions at fast growing start-up companies in his career. Those companies grew so fast that, according to Hunn, they didn’t have time to create a formal vision statement. At Resonate Insights, he said, “We’ve never really been smart enough to come up with one. The best thing we can do is to make the vision a living thing with the company by continually reinforcing it verbally and through behavior.” 

Other leaders indicated that they felt they couldn’t initially live up to the idealism that would have been reflected in a vision statement. Scott McNealy, former Chairman, CEO, and founder of Sun Microsystems, explained why he felt that stating a vision in the company’s early days would be hypocritical: “Most leaders use the vision statement to sound and look good, but if it doesn’t reflect what’s going on in the company, then it’s worthless.”

McNealy wanted to evolve the culture to the point that it reflected his vision; only then did he think there was enough alignment for him to communicate a formal vision statement.  He developed a formal vision statement many years after founding the company, which was to “eliminate the digital divide while doing no harm to the planet.” 

Despite the lack of a formally stated vision, these leaders found ways to implement the vision in a variety of ways. They set goals aligned with the unstated vision and reinforced those goals through slogans, mantras, and symbols. The leaders felt their energy and focus were contagious and helped motivate their employees. They obtained a shared sense of clarity with them through continual discussion of the desired future. Andy Hunn explained how he ensured that employees were clear on his informal vision when he was at internet company Digex:

It worked because we spend a tremendous amount of time playing the role of connector. The role had nothing to do with our formal responsibilities in the company, but we spent time with employees who were executing on day-to-day work and were talking to them about strategic opportunities in the market. This kept everyone going in the same direction.

Another key to success at this stage was the leader and co-founders to share and agree on the vision. One way they were able to do this was through constant communication. Jody Glidden, founder and CEO of Introhive, stated that he and his co-founder had “pretty passionate discussions” about what the company should be. They had founded a previous company together and therefore felt that they were on the same page without having to formalize their vision.

Leaders with fewer than 30 employees indicated that it was possible to have frequent, one-on-one conversations with co-founders and employees to ensure common understanding and implementation of the vision. Leaders of companies that grew beyond the size of 30 employees and who waited to write a vision statement reported that they wished they had written a vision statement sooner. Kristin Sharpe of ACF Solutions stated:

We didn’t have it formally written down until a couple of years ago. That’s unfortunate, but that’s the truth. When we did the mission, vision, and core values, we were at a time of growth and change, which is not easy.

It is painful and hard at times to bring about change. It’s very personal. I wish that we had more formally written down the vision statement early on. We said that because we’re small, we don’t need to write it down. I didn’t realize how important it was until I sat down to do it. It was good that we did it then. It was good to get it down and was more challenging than I expected.

So, although it was possible to experience considerable success, imparting the vision using a one-on-one approach was a time consuming, labor intensive process for the leader. That process became nearly impossible as the company grew beyond 30 employees.

Stage 3: Formally Stated

Almost all of the leaders progressed to Stage 3 by developing a formal vision statement. Some leaders developed it alone, while others involved a combination of co-founders, top management team, employees, customers, and other stakeholders.

How the leader went about writing the statement depended on the size of the company. For small companies, some leaders felt that they bore sole responsibility for writing the statement. Ashley Harding, founder of Bubble Shack Hawaii, a manufacturer and wholesaler of natural bath and body products, stated: “The responsibility for writing the statement falls squarely on the entrepreneur’s shoulders.”

Other leaders involved all employees in reviewing the vision statement. John Abrams of South Mountain Company indicated: “We had a draft statement that we reviewed in a series of open meetings” with employees.

In contrast, larger companies included executives as well as employees representing specific groups and units. Larry Sternberg of Talent Plus described a facilitation process for a vision statement development workshop that he had used with several organizations. The process consisted of forming a planning group that represented executive and lower levels in a company, asking thought provoking questions to generate debate about the vision, and articulating draft vision statements that were then shared with others to obtain feedback before finalizing the statement.

Kathryn McCarthy of ThinkGeek recommended using an outside facilitator to guide a larger team through the vision statement development process. McCarthy explained, “Everyone in a company has their own strong, passionate views. Having some help to pull all those views together is helpful.”

Stage 4: Refined

At Stage 4, leaders sought feedback on the draft vision statement in an attempt to find the right words to express their vision. They used the feedback to create the final version of the vision statement.

Gabe Hamda, founder and president of ICATT Consulting, a small human performance consulting company in Jacksonville, Florida, had been trying to find the right way to express his vision for his company. He was meeting with a client when he said, “We improve your people.”

Hamda suddenly realized he might be insulting the client by implying that her employees were not up to par, so he asked her if that was the case. Before the client could answer, one of ICATT’s interns whom Hamda had brought to the meeting responded, “Let’s say that ‘your people are great and we make them better.’” That statement became ICATT Consulting’s formal vision statement.    

Similarly, Bill Karpovich, co-founder and former CEO of IT consulting firm Zenoss, described how the company’s original vision statement, “Changing the game in systems management” was refined to reflect terminology that more clearly conveyed his intent as well as wording that was commonly used in the technology industry. The final statement became “Transforming IT operations.”

Stage 5: Re-examined

At Stage 5, leaders periodically re-examine and, if needed, revise the formal vision statement. Leaders intentionally review the vision statement from time to time, such as quarterly or annually, to ensure that it continues to reflect the current state and is clear to employees. The vision statement is only revised if the company evolves, employees are unclear what the original statement means, or the market changes.

Jill Nelson, founder and CEO of Portland, Oregon’s Ruby Receptionists, explains: “The essence of our statements has never changed, but the wording has changed a few times.” To Nelson, perfecting the wording is a never-ending process. She revisits the company vision statement at an annual leadership retreat. Ruby Receptionists’ vision statement is “We want to be the business-hold name [similar to being a house-hold name] known for exceptional customer service and making personal connections.”

Founded in 1922, leadership and employees at Allen Edmonds had seen the market change many times.  CEO Paul Grangaard took over in 2008 when the company’s market share was declining and debt was increasing. Grangaard updated the company’s vision to clarify its new direction of expanding beyond men’s shoes to men’s apparel. He explained, “Our vision was to regain our position as a great American shoe company, and now it is to become an American lifestyle brand from head to toe.”

Kathryn McCarthy, now-former Chairman and CEO of Geek.net and ThinkGeek, also evolved the vision statement as the company’s offerings changed. Founded in 1999, ThinkGeek’s original business consisted of several websites as well as the ThinkGeek e-commerce site. The two lines of business had similar customers but were different enough that the decision was made to focus on the e-commerce side. The tag line “Stuff for Smart Masses” doubled as the initial vision statement in the early days. Once the decision was made to focus on the ThinkGeek site, a more formal vision was created, which was, “To create a world where everyone can embrace their inner geek, express their passions and connect with one another.”

The vision statement helped the company focus on a broader definition of what a geek is, according to McCarthy. It reinforced the idea that the client base included uber geeks that were the original client base as well as “moms who want to buy gifts for people in their lives,” she stated. This led to adding more products geared toward women and other demographics that were different from the company’s original focus.

Communicating and Implementing the Vision Statement 

All leaders agreed on the importance of communicating the vision statement repeatedly to employees as well as implementing it so that all aspects of the company were aligned with the vision.

Communicating the vision statement entailed much more than sending a single email or printing posters with the statement. The leaders communicated their vision in many different ways. Founder and CEO of recruiting firm Dahl-Morrow International, Andy Steinem, emphasized: “We have a lot of communication; we have weekly meetings where we talk about our goals for the week as well as our challenges and what we are doing in a changing market or landscape.”

Larry Sternberg, President of Talent Plus, suggests keeping the vision, along with mission and values, alive with a 10-minute daily stand-up meeting with employees, where each element of these statements are reviewed each day.

Communicating the vision went beyond simply repeating the statement word-for-word. Leaders tailored their explanations of the vision statement to get the message across. Ashley Harding, founder of Bubble Shack Hawaii stated, “We have to deliver the same message in a different way to different employees, whether they are putting labels on bottles or are sales executives.”

Perhaps the most important step in the cycle is implementing the vision statement. Regardless of which Stage of vision statement development cycle a company was at, the leaders emphasized the importance of putting the vision into practice by aligning strategy and goals, systems, culture, and with the vision statement.

In conclusion, although creating, communicating, and aligning a vision statement is not always easy to do, it does not require expensive investment. It does, however, require focus, effort, and energy. Leaders who are passionate about their companies should, no doubt, be able to harness their own inspiration and share it with the rest of the company.

 

The work discussed in this article is independent of Dr. Kirkpatrick’s MITRE role. The author’s affiliation with The MITRE Corporation is provided for identification purposes only, and is not intended to convey or imply MITRE’s concurrence with, or support for, the positions, opinions, or viewpoints expressed by the author.

© 2016, Shelley Kirkpatrick. All rights reserved.

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