CEOs and development of the meaningful mission statement

Abstract

Developing a mission statement has been considered a crucial factor in the formulation of business strategy in organisations. The mission statement promotes a sense of shared expectations in employees and, not surprisingly, it has recently been regarded as increasingly important in small‐ and medium‐sized enterprises (SMEs) in the electronic industry. One major reasons for this is the growing complexity and dynamic competitive environments in which these enterprises have operated and managed to find themselves. Mission statements have become a management tool most commonly used by chief executive officers (CEOs) over the last decade. One exercise that both academics and practitioners have deemed strategically critical to the success of an enterprise is the development of a meaningful mission statement. This article explores the perceptions of CEOs of their mission statement in SMEs. It is based on the findings of recent research in 508 firms in the electrical and electronic industry in the UK. The study, amongst other things, investigated the existence and content of the mission statements and, accordingly, it determines the relationships (if any) between a SME’s development of a meaningful mission statement and selected performance outcomes of the firm.