A strong vision boosts a company’s efficiency
A correctly set vision is essential for a company to perform well. A survey performed by JIC on over 100 companies from #brnoregion illustrates clearly that a company’s vision and its performance are very closely linked. Companies lacking a clear vision or goal have nothing to achieve and miss the “drive” to push them forward. The 102-company survey shows that it’s not enough for a company to have a vision – it needs to be correctly formulated and well-grounded within the company. And empty vision achieves the same level of performance as no vision at all, the survey showed. “A vision that the company does not actually follow and instead just uses to decorate their walls and email footers is just a false façade,” confirms Michal Hrabí from Phonexia, one of the companies that took the survey and placed very well.
Performance doesn’t equal turnover
And how do you measure performance of a company? In this case, JIC used the Balanced Scorecard concept based on four perspectives of the organization – financial, customer, process (innovation), and human resources. The survey didn’t focus solely on the financial aspects of a company, but instead viewed each company as a whole, assessing their priorities and the way their strategic management works. In other words, it assessed the vision, mission, and strategic goals of the companies and the way they monitor them for themselves.
Based on the collected data, companies were divided into three performance categories. High-performance companies rated as A (31 companies), medium-performance companies rated as B (46), and low-performance companies rated as C (25).
Nineteen participating companies had no or an unclear vision (for the next 5–10years), yet two of them managed to rank among the A-rated companies. The remaining 17, however, automatically received B or C ratings. A vision (and the drive to perform as well) can differ between companies. As many as ten A-rated companies claim technological advancement or company upgrading as the basis of their vision. Five companies are driven forward by a vision to become a leader in their discipline, and the same number of companies are motivated by a vision to become a leader in an existing production area. A desire to expand on the market is important for these companies as well.
The results of the survey prove that a vision is a fundamental component of company development, culture as well as strategic management and planning.
Vision as a by-product
Phonexia is a supplier speech processing technology; it created its vision more or less by accident during a rebranding about three years ago. The vision emerged during the revision process of the company strategy as a sort of by-product. The aim of the company was to become a preferred European supplier of speech technologies for partners all over the world. Within the three years since then, the company achieved its vision (which the company itself considers less than ideal) and is now preparing to push that vision even further. “We have three teams with a very strong product vision, which is currently being polished further. In the near future, a universal vision for the whole company will be created,” explains Michal Hrabí.
A strong vision most frequently contains upgradingDo strong visions have anything in common? Survey says: YES – upgrading. 18 companies mentioned it in their visions as an element that drives them forward.
Functional (or intersectoral) upgrading is in the plans of 8 of the companies surveyed. In a specific period, they plan to implement new activities, e.g. in addition to production, they will gradually focus on service provision as well or use their skills to produce brand new products. Through this process, a mere distributor can become a company that deals in the development of products in a related discipline.
Product upgrading was mentioned in the visions of seven companies, meaning that they aim to improve the quality of their products. During product upgrading, companies focus on developing more complex products that will offer increased added value to their customers.
Succession as a problem
Also, the survey showed an interesting tendency: small Czech companies often have no vision at all. In 19 companies with an unclear vision, a succession issue very often plays a negative role. Long-term planning is complicated, especially for small companies established in the 1990s after the Velvet Revolution when our country switched from a centrally-planned economy to a market economy. Today, after 30 years of doing business, their owners start to feel the need to pass their companies on to someone else, so their main vision is often “only” to do this smoothly or sell the company and stabilize further development.
Around 40% of companies use general statements in their visions, such as “increase turnover or volume of production”, “invest into the facilities”, “optimize the processes” or “stabilize the company on the market”. Here, the vision is not clear and makes desired success harder to achieve. According to the results of the survey, a clear vision is fundamental for the growth of a company, its culture as well as strategic management and planning.
A vision instead of a boss
The revision of its company strategy allowed Phonexia to attract new, skilful employees. According to Michal Hrabí, a correctly set-up vision not only brings skilful people but also allows employees to be more independent.
“Each employee, from a receptionist to a coder or a CEO, makes decisions every day. Even if these decisions are only minor, they are all affected by the vision in some way, making it easier for them to choose correctly without requiring input from a supervisor. If people know what their company’s vision is, they are better equipped to make decisions in harmony with it.” Michal Hrabí, Phonexia
If this is not the case, then the writings on the wall lose their meaning and become hollow, useless phrases. In these cases, Hrabí explains that employees are unable to imagine how to apply a unified meaning to their everyday work. Also, he’s aware of the need to regularly revisit the vision and verify that it is still applicable. “The same lies ahead of us in Phonexia. The most important part, however, is that you yourself, as a leader, have a clear vision. Without one, you don’t radiate anything and those around you will struggle to contribute to your mutual success,” concludes Michal Hrabí.