Project Management Accounting: Budgeting, Tracking, and Reporting Costs and Profitability, Second Edition

Mission, Objectives, Strategy

In order to have a clearer understanding of what Mission, Objectives, and Strategy mean, we need to look at some definitions and examples. Mission, first of all, is a statement of the purpose for the company's existence. An example of a simple mission statement could be General Electric's: “We bring good things to life.” It is simple and easy to understand. Honeywell's mission statement is quite eloquent in its simplicity: “We are building a world that's safer and more secure, more comfortable and energy efficient, more innovative and productive.”

In each case, the company's reason for existence is stated clearly and simply, giving direction to all that the company does. The reality is, however, that carrying out that mission is usually much more complex than a simple statement. Problems arise when management is not able to turn a mission statement into action and employees do not understand how their work carries that statement forward. That situation is where mission is often confused with strategy.

Strategy consists of a series of concrete actions that a company performs in order to carry out the mission. Each concrete action is an Objective. The actions must support the mission of the company but must also adhere to good business principles. One of the fundamental responsibilities of a company is to create a return for its owners, whether they are a small group of investors or a large group of stockholders. There is always the responsibility to ...