Vision Statement free essay sample

Core values are those that would remain unchanged regardless of time, current industry environment and any management trends. Core values are the building blocks of a company and are consisted of those values which strongly hold by the company. Core purpose is the reason that the company exists and it is also unchanging. Core purpose provides a clear direction of where the organisation is headed and distinguishes one organisation from another. On the other hand, visionary goals are objectives that a company decided to attain in the future. We will write a custom essay sample on Vision Statement or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Once the goals have been reached, it is ultimately essential for the company to come up with a new goal/s to replace the old ones so as to ensure that the company would be successful in the long run. It is believed that both core values and core purpose of the company are discovered whereas visionary goals are selected. Therefore, a good vision statement is one that would not only reflect the management’s objectives for the company but would also point the company in a particular direction and plan for the road that lay ahead of it in the future. The company that I am assigned to is called Andrew and it is an electronic sensor manufacturing company. A sensor is a device that senses the environment and it is used for security purpose. It is placed in things such as car to measure temperature, heat and speed. The electronic sensor market is continuously changing. Customer’s expectation is also changing. Customers want a smaller sensor with a high performance. Some would also want a cheaper product while others would not mind paying higher price. Previously, there has been an industry shake-up and a case where the old management team has failed to meet expectation of the shareholder. As a result, the old management team was dismissed and new management teams are assigned to do the job. Currently, there are six smaller, identical companies all vying to capture the biggest market share in the sensor industry. All of the six teams are without any specific vision statement. Thus, being a new management team that is in charged of the new company, Andrew, it is necessary to create a new vision statement. Andrew’s vision is to be world’s leading manufacturer of electronic sensor, with the biggest market share in the industry. In terms of our core values, we wish to be the top supplier of the most innovative and technologically advanced sensor to the customers. Andrew also strongly believed that our company’s success would be very much depended on meeting customers’ expectation and satisfaction. Thus, it is extremely important for Andrew to manufacture a product (sensor) that would meet the constant changing demand and need of customers. A good customer service and a good quality product are crucial for developing a strong long-term relationship with the customers. Besides providing excellent customer service and pioneering technology, Andrew’s last two core values involve being honest and open to suppliers, shareholder and employees and having a good social responsibility where Andrew is committed to protecting the environment, giving back to the local communities through various charities and sponsorship and caring for our employees’ rights and interests at all times. In terms of core purpose, Andrew seeks to help customers to build a more advanced and smaller sensor which is also affordable at the same time. Finally, Andrew’s visionary goals are ones that consist of being the number one market leader in electronic sensor industry in eight years time, gaining a 60-70% total market share; with 65% in the high-tech segment and 25% in the low-tech segment and developing a beneficial long-term relationship with customers. Andrew would adopt a differentiator approach. A differentiator is one that seeks to create maximum awareness and brand equity. A differentiator also wants to be a well-known makers of high-quality and highly desirable products. By using this strategy, Andrew would have a high RD spending so as to keep the products fresh and to sustain a presence in both market segments. Andrew would therefore have to spend heavily on advertising and sales promotion to create a maximum awareness and accessibility to its products. As a result of this, products tend to be priced higher. Andrew would focus on market share, profits and stock price. In the marketing section, Andrew being a differentiator would want to concentrate in manufacturing a technologically advanced product with a slightly higher focus in the high-tech niche market. It is also essential for Andrew to have an accurate sales forecast. This is because manufacturing too many sensor units results in extra time and material costs being incurred. On the other hand, manufacturing too few or little sensor units would lead to stock outs and loss sales which can be even more costly. Prepare for the sales forecast by looking at industry demand for the next round, the number of products in the particular segment, comparing with other company’s products based on their accessibility and awareness and whether the products (sensor) produced would meet the demand. The fact that there is going be a substantial spending on promotion and RD, would affect the price of Andrew’s product, causing it to be relatively expensive as well. To keep the price affordable to customers, Andrew would have to introduce the discount strategy. Under this scheme, customers’ total buying price would be cut off when they buy sensors in certain number. The discount would vary depending on the total number of products the customer decided to buy (e. g. a 5% discount for purchase of 10-20 sensors and a 10% discount for purchase of 30-40). This would directly encourage the customers to increase their purchases and buy in bulks. Being a differentiator would also require Andrew to carry out big promotion to market its products to the customers. Promotion also plays a big role in customer demand for a given product. You can design a great product, but if nobody knows about it your sales will suffer (manager’s guide). A high promotional cost would decrease the amount of money left for RD and would subsequently affect the quality of the manufactured products. Thus, it is necessary for Andrew to seek alternatives means for promotion, other than advertising the products through promotional tools such television, magazines, radio and etc (which are costly). The solution to this problem is to promote the products by word-of-mouth and recommendations by the customers. This is definitely a more cost-effective way for creating awareness among customer groups. In the production section, Andrew will manufacture two products; Ace and Adage. Ace will be first to be introduced into the market. Ace will be a high-tech product which are highly demanded and desired by the customers. Ace will be produced in large number, approximately 2000 and sold so as to generate sufficient profit and income that would ultimately be needed to produce Adage later in the production line. Adage would take two years to mature. Approximately two to three years later when there is a shift in customers’ preferences and wants and Ace is no longer regarded as being the most desirable and advance products, Adage would be launched into the market. Ace would then move into the low-tech segment. At this time, production of low-tech segment would stop to make way for Ace in that segment. Since the low-tech products are no longer the targeted segment, any resources used to produce them can be sold or disposed. The cash generated from that can be used to fund RD or to carry out promotional activities that are required when Ace is in the low-tech segment so as to create high sales. In terms of Research and Development (RD), investment in that section can be increased through by cutting down on spending on promotional costs and by selling off assets used to support the low-tech production. Investment in this particular area should only be increased through means of emergency loans, such as the issue of common stock and a long term debt, when Andrew’s cash position is in red (indicating a shortage of cash surplus as a result of sales revenue not exceeding expenses). Due to the fact that there is going to be large amount of money being spent to finance the RD and promotional activities for Andrew, under the differentiator approach, it is therefore best for Andrew to keep the profits instead of paying them out as dividends. The profits would serve as useful cash-on hand should there be any shortage in capital to support any of the activities mentioned above and to pay off any debt or interest on our loan. It is also crucial for Andrew to pay off any debts immediately to avoid any high-rates interest on those loans. This is because the longer Andre waits to pay the supplier, the longer and more materials they withhold form your production. This is would in turn directly affect your sales activities and profits. By the last round, Andrew is expected to have invested to have at least generated $40 million in sales that it has initially invested in the first round, so as not incur any losses or debts. It is also clear that under the differentiator approach that Andrew is biased towards differentiator product as compared to cost leadership. Andrew aims to be the producer of the state-of-the-art sensor technology where price is secondary to the product’s quality rather than one where price is the primary key and quality is not regarded as equally important in determining the purchase of sensor. In conclusion, a company’s vision statement is of utmost vital for the survival and growth of any type of business. A company’s vision statement provide an insight into the company’s core ideology- its deeply held values and the reason that it had existed and map the road and future business directions and plans that it should follow in order to achieve its long-term objectives goals. To achieve its objectives and goals, the company needs to implement workable and good tactics to carry out its basic company activities- research development, marketing, production, finance, human resources and total quality management.