Do mission statements matter to employees?

Companies typically expect a mission statement to address the questions: Why do we exist? What is our purpose? What are we trying to accomplish? They are popular in use and often considered important for organizational success. This research considers whether there actually is a link between mission statements and financial performance.

What you need to know:

Mission statements matter. Creating an employee ‘connection’ to the mission statement will focus company resources and harness enthusiasm, driving the firm to financial success. Management must ensure that staff are aligned with, satisfied with and committed to the mission for their behaviour to positively impact the bottom line.

More Details:

What did the researchers do?

Chris Bart, Nick Bontis and Simon Taggar asked: What relationship does a mission statement have to firm performance? To answer this, they drew on previous studies to understand:

  1. the variables that impact the mission;
  2. how they interact; and
  3. how they relate to firm success.

The variables studied in this research were mission content, mission-organization alignment, commitment, satisfaction, employee behaviour and firm performance. A model was tested with data from 83 large North American firms.

What did the researchers find?

The team found that mission statements do affect business performance primarily because of employee behaviour. However, only when employees feel connected to the mission can they conduct themselves with the passion and resolve needed to fulfill it. Other factors affecting success of the firm include employee alignment to, satisfaction with and commitment to the mission. Failure on any one of these factors decreases firm performance.

How can you use this research?

Management teams can use this research to build an inclusive, employee-focused process of mission statement development and execution.

Want to know more?

Contact Simon Taggar

Article citation: Bart, C., Bontis, N., & Taggar, S. (2001). A model of the impact of mission statements on firm performance. Management Decision, 39, 19-36.

Megan Hall

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Megan Hall