Episode 25: Startup Pain: Mastering the Vision and Mission for Startup Success

Discover the strategic secrets that could be the game-changer for your startup's journey to success. Join me, Shawn, on Full Circle, as we navigate the essential yet often overlooked foundational elements of vision and mission statements. These guiding lights do more than just chart a course; they fuel motivation, sculpt brand identity, and are a beacon for top-notch talent and investors. With a clear vision, your startup won't just wander in the wilderness of the market but march towards a future of realized aspirations. We discuss why differentiating between your far-reaching vision and the actionable mission is key to making decisions that resonate with your company's core objectives and long-term goals.

Beware the siren call of excessive pivoting—it can steer you off course and into uncharted waters fraught with scalability storms and market misalignments. In this episode, we dissect the pitfalls that startups should sidestep to preserve their core vision while maintaining the agility to adapt when necessary. I'll share a wealth of resources, like "The Lean Startup" and mentorship programs, which serve as your compass for refining your strategy and staying aligned with your startup's true north. Plus, get a sneak preview of our next conversation on emotional intelligence, an indispensable skill in the entrepreneur's toolkit. Whether you're a seasoned entrepreneur or fresh on the startup scene, this episode is your map to navigating the strategic seas with confidence.

Transcript

Speaker 1: 0:00

Hello and welcome to Full Circuit with Sean. I'm your host, sean, and today we are back in our little startup pain series and we're talking about direction. So direction in startups, defining a clear vision and mission for startups and making strategic decisions. And just keep in the back of your mind that during this conversation, there are times that you have to take things outside the box, and that's when you're in survival mode, and we'll talk about those in some future episodes. But today is all about direction. So we start by defining what's our vision and what's our mission. Right, because a clear vision and a clear mission provides your startup with a definitive sense of purpose and, obviously, a sense of direction, and this makes it easier to guide your decision making, your strategy, and it helps align all actions and initiatives with the overall goals of your company and when I say your company, you might be somebody that works in a startup. So it's really good to understand some of these aspects Now. Proper direction can serve as inspiration and it will motivate the team and foster a sense of engagement and commitment. Employees who resonate with the vision and the mission are going to have a lot more energy. They're going to be a lot more enthusiastic and more productive. And then you have you know your brand identity and positioning. So if you have a good vision, then you can create a strong brand identity because you know what you're trying to achieve. You know what your goals are and that can be differentiating from competitors. So it helps to clarify your communication and your value proposition to both your customers and your investors, and even your partners. If you have partners, it'll help to align your resources. You can obviously more efficiently allocate and utilize your resources because you'll be prioritizing projects and even investments because they align with your core objectives projects and even investments because they align with your core objectives. And then, when you want to attract talent and again investments, startups with a compelling vision or a compelling mission are more likely to attract top talent and secure investments. So let's talk, let's dive a little bit into our vision and our mission.

Speaker 1: 2:21

So what is a vision? What is a vision statement? Okay, so a vision statement is a forward-looking declaration that sets the startup's long-term goals or the business's long-term goals, and it describes what the company aspires to become or aspires to achieve. So it serves as inspiration and as a point of convergence for all strategic efforts. And now, what's a mission statement. So the mission statement is the detail of the company's current objectives and approach to reach those long-term aspirations. So it more focuses on what the company does, who it serves and how it's different from its competitors, which can provide that blueprint for the daily operation and the decision making.

Speaker 1: 3:08

And if we look at some of the vision statements from some companies, we can look at Tesla right, tesla. Their vision to create the most compelling car company of the 21st century by driving the world's transition to electric vehicles Okay. But then if we look at their mission statements, it's to accelerate the advent of sustainable transport by bringing compelling, mass-market electric cars to market as soon as possible. And there you can see their forward-looking declaration of their long-term goals is to be the most compelling car company of the 21st century. And then if you look at their details company objective so what's their approach? It's to accelerate sustainable transport and then mass market electrical cars. So you can break these down. So let's look at another example. Let's look at Airbnb. So Airbnb's vision and I will talk on Airbnb when we get into marketing, because Airbnb was very, very intelligent with how they decided to launch and we'll go through that but Airbnb's vision is to live in a world where, one day, you can feel like you're home anywhere, and not in a home, but truly home, where you belong. Okay, and their mission is to make people around the world feel like they can belong anywhere. And we take those vision and those mission statements and we grow our company with keeping those as the core objectives of our company.

Speaker 1: 4:36

Now, if we look at the role in strategic planning, our vision and our mission statements play very pivotal roles in strategic planning. So they, as I said, they serve as the foundational elements that influence every strategic decision. And then they help to ensure that our strategies developed are aligned with our core purpose and the identity that we've come up with. And then we use these. We use these to help prioritize areas or guide resource allocation or even shape the policies or our operational guidelines. They can provide the framework for evaluating new opportunities so, as new opportunities arrive, and then we can decide which avenues are worth pursuing because, as you'll find out, in a startup or as a small business, you might get pulled every which way. But what should you be doing? And that really leads to our strategic decisions.

Speaker 1: 5:29

Okay, so there are. You know there are a lot of different aspects to your strategic decision. So what are the long-term impacts? You know what's the complexity, what's the resource commitment and if we tear these down, so the long-term impacts, what is that about? So those are strategic decisions distinguished by long-term implications on the organization's direction. So they typically influence a company's trajectory for years rather than right now, rather than immediate outcomes. And then we look at complexity and say scope. Now these decisions often involve high levels of complexity, uncertainty. They require an understanding of a wide range of factors including, say, market trends, competitive dynamics and even your internal capabilities. So strategic decisions usually entail substantial allocation of resources, and that could be financial, human or even technological. And the commitment is significant because it can shape the organization's capability and its position in the market. And you're saying, ok, sean, that's fine, I understand that.

Speaker 1: 6:38

But what about ordinary business decision? And why is it different? So if we look at, say, operational versus strategic, ordinary business decision and why is it different? So if we look at, say, operational versus strategic, ordinary business decisions are usually operational in nature, they're aimed at managing the day-to-day and often have, say, short-term focus, while strategic decisions are about setting the course for the future and even defining the operational ethos and you have reversibility so operational decisions are easier to reverse or easier to modify, whereas strategic decisions that happen over a long period of time and have a much higher impact are harder to reverse without very significant consequences. And then involvement level. So strategic decisions require the involvement of consensus of, say, top management and key stakeholders and, it needs to say, reflect their broad impact of the organization, where ordinary decisions can be made by mid-level or even department managers, with very limited implications beyond the specific areas that the decisions are made in. So now we understand decision making. We understand the difference in, say, operational versus strategic.

Speaker 1: 7:51

Now let's look at aligning these decisions with our vision and our mission. So the first thing we need to do is consistency checks right. So we need to regularly evaluate decisions to ensure they're constant with our vision and mission. Regularly evaluate decisions to ensure they're constant with our vision and mission. This involves assessing whether the outcome of these decisions will move the company closer to its long-term aspirations or not. Right, we need to make sure that we're fitting within our strategic framework. So by utilizing strategic frameworks and different tools that we'll talk about later, like SWOT, to analyze how different choices align with the company's values and missions, we can help identify the opportunities and the threats in relation to the company's strategic goals. And then we should have decision-making criteria. So establish clear criteria for decision-making and they should reflect your core values and your company's core values and the strategic objectives, and this criteria should guide the selection of options in a way that prioritizes alignment with your values and missions.

Speaker 1: 8:55

You also need to make sure that you have stakeholder engagement right. So you need to involve the stakeholders in the decision-making process. And I know you're going to say, well, that's just going to lead to a blow-up and everybody's not going to agree and that's good. Agreement does not foster innovation. Agreement does not foster growth. You need that collaboration. You need people to be open. You do not want yes, people, and we'll talk about that later on as well in this part of the series. So, as I said, you need these discussions and you need them with employees, you need them with customers, you need them with investors. You need everybody that's a stakeholder to have some of these conversations. And then you need regular reviews. So you should implement a regular review process where past decisions are revisited and they are assessed to determine their impact on the company's strategic direction, because it's no good in just making a decision or a strategic decision, and then not looking back and saying did we get it right? Did we get it wrong? Did we pivot later from that? How did we do? Because that'll really help your growth, but it'll also help your company growth and even redefining some of your strategic goals.

Speaker 1: 10:06

Now let's look at some frameworks. So let's look at SWOT. So, for everybody that doesn't know, swot is Strengths, weaknesses, opportunities and Threats. So it's a tool used to evaluate these trades involved in a project or in a business and it helps identify both the internal and the external factor that can impact success. So digging down a little bit more strengths so strengths are internal attributes and resources that support successful outcomes. So some of the examples could be, say, your workforce, your intellectual property, your brand reputation or even your financial resources. Weakness so those are internal factors that might hinder your company's success, and they could include gaps in expertise or limited resources or even inefficient processes. And then you have opportunities. So these are external conditions that the business could exploit to take advantage of it. So say, market trends or regulatory changes or even technological advancements that the company can capitalize on. And then you have threats, right? So external challenges that cause trouble for the business and threats could be economic downturns, say, increased competition, changes in consumer preferences or even environmental factors.

Speaker 1: 11:33

And then if we look at RACI, so the RACI matrix is responsible, accountable, consulted and informed Okay, responsible Individuals or teams tasked with performing the actual work to complete the task, and they are the ones doing the legwork. Accountable, the single person accountable for the correct and thorough completion of the task. This is usually a project manager or, say, a team leader, and then consultant, those whose opinions that you need. You're looking for, it's typically your subject matter experts, and it's crucial to get their input because they can influence the outcome of the tasks. And then informed, the people who need to be kept up to date on the progress or the decisions, and these people don't need to be directly engaged in a lot of discussions or even the execution of the task, but they need to be kept in the loop. And I'll give you some resources to really get up to speed on some of these frameworks and other frameworks and what other people have done, because it's always good to look into what other people have done to increase both your understanding and help you grow in these things.

Speaker 1: 12:40

So now let's look at pivoting. Okay. So we're talking about direction, we've talked about our mission and our values and our decision making, but when is the right time to pivot? So the first thing we need to do is understand pivoting. So what is pivoting?

Speaker 1: 12:57

Pivoting is, say, a strategic shift, and it could be a shift in the business model. It could be a shift in your product or service offering, and it's normally in the response to market feedback, changing conditions or even unmet customer needs, and it involves altering the aspects of the company's direction. Now the significance is adaptability, right? So pivoting demonstrates your ability to adapt to its environment, and that could be crucial to the survival or the growth in, say, a fast-paced or unpredictable market, and that's what a lot of startups face. You're looking at opportunity maximization, so by pivoting, startups can capitalize on new opportunity. And then you got learning and innovation. So pivoting encourages continuous learning and continuous innovation, and it requires the startup to constantly evaluate the performance of market fit while they continue to adjust.

Speaker 1: 13:54

So when are the right times to pivot? So, as we said, market changes, right. So significant shifts in market trends, customer preferences or emerging technologies. I mean, just because you're a disruptor does not mean you can't be disrupted, right? Constant failures to meet objectives. So if you're constantly missing key performance indicators or sales targets or even other strategic goals, it could show you that your current approach is not working. Then you have your feedback loop, and if you're continuously getting negative feedback from customers or users about your product features or usability or just generally the overall satisfaction, then, yeah, it could be time to pivot.

Speaker 1: 14:35

And then you have financial pressures, and that's what a lot of startups will understand is running into financial difficulties, so declining revenue, unsustainable burn rates or even the challenges in raising new funds. And then you have competitive pressure, right, so you're losing market share to competitors or you're facing increased competition. That could prompt a pivot. But you do have to be very cautious of excessive pivoting. So a lot of things that we run into are, say, client-driven pivots. So, oh, it's really great, but I would like this feature, I need this thing for my work. And you have to be cautious because narrow focus is a high risk.

Speaker 1: 15:19

So pivoting based solely on the feedback or demand of a few clients can lead to a product or service that is too narrowly focused. You can also dilute your vision. So adapting the business strategy to suit individual clients can dilute the startup's original vision and the original mission. Resource misallocation, and that's a big one, right? Your client A wants this, and out of 50 clients there's one client that wants this, and it just has to happen. Or you're not going to get that one sale or you get beat up to. You know you get beat up, you know how it goes, and. But what happens is it takes resources to do that and that can take away opportunity as well. And then you have scalable issues. So customizing offerings extensively for individual clients can create solutions that are not scalable or even universally applicable anymore, right. So then that can hinder your growth and even your expansion opportunities. And then you have to be cautious of market misalignment. So the risk of missing the larger market trends and needs because you're again, you're narrowly focused.

Speaker 1: 16:30

Another pitfall of excessive pivoting is, say, losing sight of core vision. So you get mission drift, and mission drift is basically frequent and unstrategic changes that can lead to a drift in what your original mission was. So the startup gradually strays from its foundational purpose, from the original goals, and then you have erosion of stakeholders' trust. So stakeholders and investors and employees and customers these people rely on consistent and a clear vision, and frequent shifts can undermine their trust and it can undermine their confidence in the company's direction. And then you have brand confusion, right? So constantly changing focus or messaging can confuse the operations, it can lower the morale of your team, employees can feel uncertain about their roles and even the future of the company, which could really affect job satisfaction and your culture, and then lost opportunities. So if you keep pivoting, without a steady vision, a startup might miss out on the opportunities that align well with its core capabilities and its market potential, and it will really spread the resources too thin.

Speaker 1: 18:03

And finally, we look at balancing flexibility and focus, so strategic adaptability. So we want to encourage a culture of flexibility and this allows the startups to respond to market changes we talked about before, without completely deviating from the core business model. We want clear core objectives. So we want to maintain clear and constant core objectives that serve as the foundation of the business and we need to ensure that all adaptations or changes in our strategy still aim to advance those central goals. We want regular strategic reviews and I know I hound down about it all the time, about reflection, right, right. So we want to conduct regular reviews of business strategies and of market conditions to ensure that there's a balance between adaptability and and our focus is maintained. We want to make sure we align with our stakeholders, so we want to keep all stakeholders informed and aligned when shifts in strategy occur. And then we want to measure our risk-taking. So we want to make sure that we're taking a measured approach to any of our risk-taking by validating new ideas through, say, pilots, controlled tests, before we do some crazy full-scale implementation Because somebody said if you do this they will come right.

Speaker 1: 19:26

And I'll tell you if I had a dollar for every time that somebody says if you just build this, you'll get lots of customers, if you just build this, you'll be a billion dollar company and it's yeah, it's their view and it's 99.9% inaccurate. But that doesn't mean that they don't need it, because this is why they're talking to you or they don't want it. So there's always a difference between a need and a want. Right, and depending on where you are in your startup will really depend on if you should be pivoting or if you should be overstretching your resources a bit, because, again, survival mode sometimes, but you can't live in survival mode forever and we will talk about that in another episode. And finally, as I promised, some resources to hone your skills.

Speaker 1: 20:18

So there's a book called the Lean Startup. It's by Eric Ries and it offers more methodologies for creating more efficient, effective approaches to developing and managing startups. You can go to any of the online courses places. They have things like how to Start your Own Startup by Corsera Mentorship programs. So SCORE. Score provides free business mentoring, or the Founder Institute Networking groups and I talk a bit about networking groups on another podcast but there are LinkedIn groups, there are meetup groups. There's all sorts of things that you can do there. There's conferences so you can go to Startup Grind or TechCrunch Disrupt.

Speaker 1: 21:00

And then there's other podcasts like how Did I Build this, which is really great.

Speaker 1: 21:05

Masters of Scale, which is really great.

Speaker 1: 21:08

And then there's toolkits and templates so you can create your own business models in Canvas or use Lean Canvas to really help you with your direction and your mission, and that'll actually move on to lots of other things as well. And as we move through the series, some of these resources will be good for that as well. And as we move through the series, some of these resources will be good for that as well. And then we all have our friend Google, who can help us, as long as we understand what's good and what's not so good. So, as I say, with everything, try to inform yourself enough so you can call out what isn't right for you, and then also with everything else it's not going to be a one-size-fits-all. And then also with everything else it's not gonna be a one size fits all. Take the pieces that you need, based on your situation, and put them together. The next podcast will be about emotional intelligence. So thanks again for joining me on Full Circle with Sean, and I look forward to catching up next time.