HOW TO IMPROVE MANAGERIAL ABILITIES
 

 

 

 

 

 

 

 

 

 

 

 

 

As the Coca-Cola example illustrates, the problem with Levitt’s thesis is that it is too broad and does not provide a common thread: a relationship between a firm’s past and future that indicates where the firm is headed and that helps man- agement to institute directional perspectives. The common thread may be found in marketing, production technology, finance, or management. ITT took advan- tage of its managerial abilities when it ventured into such diverse businesses as hotels and bakeries. Merrill Lynch found a common thread via finance in enter- ing the real estate business. Bic Pen Company used its marketing strength to involve itself in the razor blade business. Thus, the mission cannot be defined by making abstract statements that one hopes will pave the way for entry into new fields. It would appear that the mission of a business is neither a statement of current business nor a random extension of current involvements. It signifies the scope and nature of business, not as it is today, but as it could be in the future.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The mission plays an important role in designating opportunities for diversification, either through research and development or through acquisitions. To be meaningful, the mission should be based on a comprehensive analysis of the business’s technology and customer mission. Examples of technology-based definitions are computer companies and aerospace companies. Customer mission refers to the fulfillment of a particular type of customer need, such as the need for basic nutrition, household maintenance, or entertainment. Whether the company has a written business mission statement or not is immaterial. What is important, however, is that due consideration is given to technological and marketing factors (as related to particular segments and their needs) in defining the mission. Ideally, business definitions should be based on a combination of technology and market mission variables, but some companies venture into new fields on the basis of one variable only. Instruments entered the digital watch market on the basis of its lead in integrated circuits technology. Procter & Gamble added over-the-counter remedies to its business out of its experience in fulfilling the ordinary daily needs of customers. To sum up, the mission deals with these questions: What type of business do we want to be in at some future time? What do we want to become? At any given point, most of the resources of a business are frozen or locked into current uses, and the outputs in services or products are for the most part defined by current operations. Over an interval of a few years, however, environmental changes place demands on the business for new types of resources.