How Your Mission Statement Can Get You Into Trouble
Mission statements tend to be loaded with lofty language. After all, with work taking up a huge part of our lives, we want the time we spend doing it to count for something more than a paycheck. And we want our company to serve a higher purpose in the world.
But sometimes it can lead us into a business we shouldn’t be in.
Consider the case of Starbucks. Here’s their mission statement:
“to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.”
Human spirit? What about the coffee?
“Most people are surprised to find out that the Starbucks mission statement has nothing to do with coffee. But it’s because Starbucks sees its mission as bigger than its beverages that the chain continues to expand and thrive and create uniquely branded Starbucks customer experiences all over the world.” Farfan, Barbara “Starbucks Mission Statement.” the Balance (2017)
Uniquely branded customer experiences? Huh?
With considerable fanfare, Starbucks acquired Teavana in 2012. Here’s what the company website had to say at that time about the purpose and goals of that marriage:
“Together, Starbucks and Teavana will jumpstart the next wave of growth in this dynamic category, leveraging Starbucks core competencies of real estate, design and store operations and integrating these with Teavana’s world-class tea authority, global sourcing capabilities, merchandising and best-in-class retail store unit economics. Powered by Starbucks existing infrastructure, Starbucks plans to continue to grow and extend Teavana’s already-successful 300 mall-based stores as well as add a high-profile neighborhood store concept that will accelerate Teavana’s domestic and global footprint.” Starbucks Newsroom (November 14, 2012)
Did they miss any clichés? Nope. I think they hit most of ’em.
Now, 5 years later, Starbucks wants to close all 379 Teavana stores because they’re “underperforming.”*
So, regardless of “mission fit” it all comes down to performance. Of course it does.
This tea business never took off for Starbucks, partly because of too many strange, exotic choices and ridiculously high prices. But the real problem was much more fundamental: Starbucks thought it seemed natural to acquire a company that sold bulk tea in malls because it was already in the “human spirit” business and tea leaves seemed a good fit. What could be more in keeping with nourishing the human spirit than the makings for a nice, hot cup of tea. That’s where they made their mistake. And their mission statement didn’t help them at all.
It doesn’t really matter what business Starbucks thinks its in. What counts is what customers think, and how they behave.
Starbucks customers tend to align themselves in one of 3 “customer experience” groups:
- High-caffeine fix-on-my-way-to-work.
- High-sugar fix with my friends on-my-way-home-from-school.
- Camp-out-with-my-laptop-so-I don’t-have-to-rent-a-desk-at-WeWork.
No, they doesn’t sound particularly lofty or meaningful, but that’s what customers think and how they behave. Now, where would a store where they put little scoops of flowery smelling tea leaves in a bag and smilingly quote you a jaw-dropping price fit into all that? Right. Nowhere. Starbucks just isn’t in the bulk-sale-of-makings-in-malls business.
It’s absolutely critical for decision making — what products to offer or discontinue, what kinds of acquisitions to make — that every company regularly go through the process of identifying what business they’re really in.
Put your mission statement aside for the time being, and ask yourself these questions (shown below with examples as they might apply to Starbucks):
What customer need causes people to think about your product or service?
- Need something in the morning to kick-start their day.
- Need a boost to afternoon slump.
- Need a place to work that won’t charge rent.
How do customers behave when they decide to access your product or service?
- Workers making a quick stop on their way to the job.
- Kids meet after school.
- Telecommuters camp out with their laptops.
What do they value when they do business with you?
- Hot coffee, lots of caffeine, easy to pick up, expensive-but-worth-it for the taste and aroma.
- Something that tastes like candy; friends are there.
- Pleasant atmosphere to work; buy a cup and make it last.
Who’s the competition and where do you stand with respect to their offerings?
- Dunkin’ is cheaper but we’ve got more caffeine and stronger, more distinctive flavor.
- Dunkin’s food choices are shrinking, but they still have more and cheaper sweet treats.
- Dunkin’s atmosphere not conducive to working there.
Don’t start by changing your mission statement or even taking down the posters or deleting it from senior executive PowerPoints for progress-toward-goals presentations. Just set it aside for a moment, and go through this exercise. See what you come up with.
Then go back to your mission statement and ask: Would it help us make important decisions about what businesses to get into or out of? If not, maybe it’s time to tune up the language to bring it more in line with the realities of how customers see the business you’re in.
*They want to close the stores, but a judge in Indianapolis won’t let them do it. Why? Because the landlord successfully argued the vacant store would hurt business more generally in their mall. This is not a law blog, but I’ll go out on a limb here and say the court overstepped its role in the universe, and the decision will be overturned on appeal. But meanwhile, Starbucks will have to continue to pay rent, stock inventory, pay staff and keep the lights on.