JS&W identifies 3 (National Museum)
Q1. Strategy as design is a logical process in which economic forces and constraints on organizations are measured through
analytical techniques to establish a clear strategic direction and in turn carefully planning its implementation. The design lens is
associated with objective setting and a plan for moving the org towards these objectives.

Objective setting is related to the gov’s funding which put economic forces and constraints on the org. i.e.

Strategic direction is a top-down way approach, not souggh advice from employees. i.e.
Q2. Strategy as experience is developed by adapting past strategies influenced by the experience of managers and others in the
organisatons and the way of doing things is embedded in the culture of the organization. When strategies develop they tend to build
on and be a continuation of what has gone before.

Adapting past strategies is the major barriers to develop innovative strategies. These strategies only work well when a
small incremental change is required within a stable environement. i.e developing a strategy as experience is rejected.
Q3. Strategies as ideas means organization has a large degree of diversity and variety within the organsation and this has the
potential to create ideas. The strategy is not planed from the top, but it emerges within and around the organization.

The strategy is dominated from the top, so no conflciting ideas
Q4. Corporate strategy is concerned with overall purpose and scope of the org and how it will add value to the org
Business level strategy is about how to compete successfully in particular markets
Operational level stategy is concerned with how the component parts of an org deliver effectively the corporate and business level
strategies in terms of resources, processes and people
Q7: to develop corporate strategy : use rational model
Q8: identify 5 benefits of rational model = “to justify the establishment of a formalized (rational) approach to strategic planning in
the org
1. Strategy’s decisions taken after careful analysis
2. The strategy is chosen based on company’s strength
3. A clear strategic direction
4. All managers focus on strategy
5. Carefully planning strategic direction implementation and increase the chance of success
Q9.5 Problems of the rational model
1. Is not widely used in real life
2. Is very costly
3. time consuming
4. the real life managers make decisions with incomplete information
Q10. Alternative approach to rational/planned model:
Minberg emergent strategy stated that the strategy is not planned in advanced but emerges from a ‘pattern of decisions’ in the
organisation
Emegent strategy consists of entrepreneurial mode (idea lens) and adaptive mode (experience lens).

Entrepreneurial mode emereges from the mind of the strategic thinkers who constantly monitor the environment, look for
opportiunity anf threat

Adaptive mode come about as the org reacts to changes in the environment
Q12. 5 benefits
1. Is widely used in real life
2. Is very cheap
3. Less time consuming
Q13. 5 problem
1. Relying on strategic thinkers is difficult to replace
2. Decisions made without detailed analysis
3. The business is reactive, not proactive
4. Focus on short-term
5. Focus on business strategy, but not implement
Q15. Factors influence the development of strategy

Culture; driven by value and culture of org

political = stakeholders: through interaction aand negotiation with key stakeholders

Learning = continuous process of learning and adapting to change
Q17-18. Identify objectives or performance measure in the business: use Balance Scorecard (Kaplan)
Financial (key ratio: liquidity, GPM, PBT%, ROCE=PBIT/CE, gearing, interest/interest expense)
Internal perspecitve: quality and efficiency of people and machine i.e return, productivity in the market
Customer perspective: measure focus on customer service and customer satisfaction
Innovation and learning perspective: new product, service, ideas
Q19 -
1. Strategy (or strategic decision)
JS&W suggest that strategy is the direction and scope of an organization over the long-term, which achieves advantage in a changing
environment through its configuration of resources and competences with the aim of fulfilling stakeholder expectations. Strategic
decisions are made under conditions of complexity and uncertainty; they have wide impact on the organization and often lead to
major change.
JS&W describes the characteristic strategy which involves (i) complex issues, (ii) uncertainty, (iii) operational decision-making, (iv)
integrated approach and (v) changes in organizational culture.
The Ashridge College model of mission links business strategy to culture and ethics by including (i) purpose, (ii) values, (iii)
strategy, (iv) policies and standards of behaviour.
Mission statements
Mission statements have been used by many organizations to provide a sense of direction to the stakeholders. They should provide
substance and clarity to a vision showing why the firm exists, what it aims to achieve its purpose and who it is in business for, can act
as a powerful motivating force for the firm.
Features and characteristics of a good mission statements
Campbell and Devine and Young have proposed four components of a good mission. Although each of these four
elements need to be linked with each other, two are oriented on the commercial rationale of a business strategy
(purpose and strategy) whilst the other two (policies and standards of behaviour, and values) focus on philosophy
and ethics.
Purpose states why the company exists (for the benefits of stakeholders?) whereas the strategy component identifies the
company’s competitive position and its distinctive competence. Policies and standards of behaviour relates to what the
outside world should expect from the company and what is expected of the employees in terms of dealing with external
stakeholders and their activities within the organisation. The value part states what the company believes in (beliefs and
moral principles).
Contribution of mission statements to the strategic management purpose
In strategic terms it may clarify the markets that the firm intends to serve, the products and services provided those markets and the
way they will be reached. In doing so it may define the boundaries and limitations of the organization chosen by the top management.
Application:
It may also specify the technologies to be used (perhaps important for NMS) and the competencies it will use to compete in its
chosen markets. It is therefore a combination of ‘hard’ tangible drivers of the business and the ‘softer’ values and behaviours, which
will enable the mission of the business to be achieved.
Mission statements is used to communicate with stakeholders
Mission statement should have relevance and resonance with all types and levels of employees. It expresses values and beliefs and in
so doing will shape and influence the policies and standards adopted by the firm. They can profoundly influence the attitudes
and behaviour of key stakeholder groups both inside and outside the firm and achieve a consistency of purpose for the
stakeholders.
Mission statement should reflect changing conditions
As the organisation grows and develops so its need for a formal mission statement may increase, enabling the direction of
the company to be understood and for more detailed goal setting and planning to be done against a consistent framework.
Its ability to communicate what the firm stands for both to stakeholders inside and outside the firm should not be
underestimated. As such, development of an effective mission statement will take time and reflect changing conditions faced
by the firm.
Effective mission statement vs ineffective mission statement
Effective statements should be brief, adaptable to changing circumstances and clearly show the distinctiveness of the firm and its
mission. Ineffective statements will convince nobody, have little or no impact on, or relevance to, what the firm does. They may be
merely statements of good aspirations and intentions, and used for public relations purposes to justify actions already taken. Once
created, good statements should be re-visited at regular intervals to ensure they are relevant to the environment the firm is operating
in.
Mission statement can contribute to the integration of organisaiton (disagree among actor and actress) – para 5
The relationship of these four components will help to achieve a cohesive and logical sense of mission. For example
what sort of behaviour might help to achieve the chosen strategy. This could help determine the management style and
the type of people to recruit.
Application
Knowledge of this could help Salchester Theatre to become a more integrated type of organisation. Consequently it is
obvious that the values of the organisation and the chosen strategy should help determine the appropriate behaviour of
the members of the organisation.
Mission statement can resolve the conflict between artistic and commercial goals
The mission statement should provide a unifying basis of communication for those people working within the organisation
and those outside it.
Application
- Bernard Mason is responsible for commercial strategy but has little influence on artistic strategy. This is as if a
managing director of a manufacturing company had no control over the product range or the quality of the products, his
only responsibility being to sell them. The difficulty has arisen because the stakeholders within such enterprises are very
powerful. Some exert considerable authority – those who sanction subsidies – but they rarely have responsibility for
managing the enterprise
The conflict arises as there is no common culture to build around. The actors/actresses appear to have very selfish ideas
as to what should be done. They believe that others – the audiences, the volunteers and the management – should all
‘be educated’ into the tastes and views that they have. There is no concern for commercial realities – the generation of
income. That is someone else’s responsibility – the local council’s or the Arts Council. This conflict between artistic and
commercial goals has bred a confused culture which will not easily be reconciled.
Mission statement can bring a common ground for the survival of business
The mission statement should include a general statement on the organisational culture. It should state the main purpose
or aim of the organisation and the areas in which it intends to operate. The mission statement should be reasonably brief,
be open-ended and should have no time constraints.
Application
- Many of the stakeholders have divergent goals. Mason has to attempt to bring together these groups and focus their
attention on a single goal – survival.
- Mason must get the stakeholders to identify areas of commonality or agreement between them and recognise that
compromise is essential
Misstion statement can contribute to general understanding of purpose
Mission statement should be clear, concise, open-ended and noncontroversial to facilitate an agreed and coordinated
strategy.
Application:
Both the Arts Council and the actors would emphasise education, the encouragement of new plays and the development
of cultural activities. However many of the volunteers appear to have more prosaic and unimaginative ambitions. They
are looking for a repeat of old established material which appears to be also popular with the audiences. The local
council, on the other hand, seems to be more interested in attracting wellknown and well-established outside companies
to the theatre, with the intention of raising the profile of Salchester town.
Each group of stakeholders could interpret this in a way acceptable to them. However if the purpose of Mason
introducing a mission statement is to facilitate an agreed and co-ordinated strategy then much more preliminary work
needs to be done. The stakeholders must recognise that a single-minded and uncompromising approach to strategy
formulation will help no-one.
Hierarchy of objectives
Peter Drucker, who outlined management by objectives, suggested that objectives should be SMART (Specific, Measurable,
achievable, realistic, time-related)





Specific: action, behaviour, or achievement described is always linked to a rate, number, percentage, or frequency
Measurable: a system, method, or procedure exists that allows the tracking and recording of the behaviour or action on
which the CFS objective is focused.
Achievable: objective that is relevant and necessary
Realistic: objectives set are capable of being achieved
Time-related: the objective set should be linked to a date by which it is to be achieved
The nature of business strategy includes three inter-connected layers:

overall strategic perspective, from strategic position through strategic choice to strategic action

basic idea of strategic implementation which emerge from within day-to-day activities

importance of the human resource
2. Levels of strategy in an organization
There are 3 levels of strategy in an organization
1. Corporate strategy:
o is concerned with the overall purpose and scope of the organsation to meet the expectations of owners and major
stakeholders. This may also incorporate the strategic vision or strategic intent of the business
o The general direction of the whole organization (profit growth, entering new market)
i.e Barlettt and Prahalad – strategic intent. These organisations begin with a goal that exceeds their present grasp
and existing resource. Then rally the organization to close the gap by setting challenges that focus on employees’
effort in the near to medium term.
Business unit strategy
o is how a company competes successfully in a particular market so as to gain a competitive advantage.
o This strategy will not relate to the organization as a whole but to a particular SBU. An SBU is a part of the
organisation for which there is a distinct external market for goods and services.
Operational/functional:
o This is concerned with implementation i.e. organisations’ resource to achieve the chosen strategy.
o i.e. HRM strategy, IT strategy, Marketing strategy.
o
2.
3.
3. Elements of strategic management
JS defines: Strategic management includes understanding the strategic position of the organsiation, strategic choice and turning
strategy into action.
JS analyse strategic management into

Strategic position concerned with the impact of strategy on (1) external environment (opportunities, threats), (2) internal
resource and competence (strength, weaknesses); and (3) the expectation and influences of key stakeholders (purpose,
interest)

Strategic choices involves understanding the bases of corporate (overall product/business porfolio) and business level
strategy (customers, markets) and options for developing strategy (direction, method)

Strategy into action (implementation): is ensuring the strategies are working in pratice.
1. Structuring – processes, relationship, organization structure and how these elements work together,
2. Enabling – organisation’s resource are managed to support and to create strategies and
3. Change – management change is the most important feature of strategic implementation.
There are two main approaches to strategic management identified by the examiner that could be asked about in the exam:
1. The ‘rational model’ of strategic management = strategic planning approach
i. The approach is largely prescriptive, rather than descriptive.
ii. This model is most strongly associated with design approach to managing strategy. This approach focuses on
developing strategy using systematic, logical rational procedures.
Explanation of the rational model of strategic management.
It is the responsibility of top management to plan the destiny of the organization that make important decision, and lower level of
management who carry out these decisions.
Justify the establishement of a formalized or rational approach
1. Decisions are only taken after careful analysis, including risk
2. This provide a clear vision and a sense of direction
3. all managers will be more focuses on strategy
4. implementation is actively planned therefore, increase changes of strategic success
5. the chosen strategy based on company strength so we can focus an it actively
2. The ‘emergent strategy’ model of strategic management – Mintzberg
Mintzberg in the ‘emergent strategy’ model criticizes the rational model as
- The rational model is not widely used in real life
- Rational model is very costly and time consuming
- The ‘real life’ managers lack implementation they make decisions with incomple information.
Mintzberg emergent strategy
This is a strategy which is not planned in advance but emerges from a pattern of decisions
Emergent strategy can be classified into entrepreneurial mode and adapitive mode. Entrepreneurial mode: the strategy is developed in
the mind of strategic thinker i.e. a person who always looks for opportunities to make money. Adaptive mode: the strategy comes
about as company reacts to change: i.e. in the wave of H1N1 “chicken flu’, KFC has changed KFF.
Case study
Honda developed an emergent strategy when they entered the US motorcycle market. Their original aim and intended strategy was to
focus on selling 250cc and 350cc machines rather the 50cc Honda Cubs. sales of the 250cc and 350cc bike were sluggish and the
bike themselves were plagued with mechanical failure. At the same time, Japanese executives were using the Honda 50cc to run
errands around Los Angeles and were attracting a lot of attention. One day, they got a call from a Sears Roebuck buyer who wanted
to sell them to a brad market of America and proved to be successful.
From the case Honda, successful strategies can emerge in the organization without prior planning which is in constrast with the
traditional view (strategies are planned)
Problems with emergent approach
1) Relying too much on 1 person and difficult to replace
2) High risk as decisions are taken without detailed analysis
3)
4)
5)
The business is reactive and not proactive
This approach may focus too much on the short-term
The focus is on the business strategy and not implementation
Experience – ideas lenses
Logical incrementalism:

managers have a view of where they want the organization to be in years to come but they move towards this position
incrementally. This is achived partly by maintaining a strong secure and flexible core business.

Managers know they cannot do away with uncertainty in their environment by trying to know how it will change. Rather
they try to test changes in strategy in small-scale steps. Continual testing and gradual strategic implementation improves
the quality of information for decision making. Since change is gradual, the possibility of developing commitment to
change is increased.
Cultural view:

Culture is a set of basic beliefs shared by members of an organization. The organization culture will play a key role in how
strategies are developed and managers may rely on the sttitudes that have brought them success in the past rather than
being innovative (experience lens)
Learning process – uncertainty and complexity of the world of organizations cannot readily be understood purely analytically. The
world to which organizations have to adapt appears to be turbulent and unpredictable that traditional approaches to strategic
approaches to strategic management are not appropriate; there is little to be gained from formalized planning.
4. The importance of context (small businesses, multinational, the public sector, not-for-profit organsiations) – not important
Q1c-dec08
(c) Johnson, Scholes and Whittington identify three strategy lenses; design, experience and ideas.
Examine the different insights each of these lenses gives to understanding the process of strategy
development at the National Museum.
Note: requirement (c) includes 2 professional marks. (10 marks)
5. The strategy lenses
The highly rational corporate planning approach based on practical experience and common sense was challenged by Simon and
Lindblom, the model is unrealistic. However, the planning model was popular and corporate planning departments were commons in
large organizations.
JS&W suggest that strategy lenses can be summerised into 3 lenses
Strategy as design = Planning analysis and systematic approach

Strategy as design means the deliberate positioning of an organisation as the result of some ‘rational, analytical, structured
and directive process’. Through the design lens it is the responsibility of top management to plan the destiny of the
organisation. Lower levels of management carry out the operational actions required by the strategy. The design lens is
associated with objective setting and a plan for moving the organisation towards these objectives.

In the context of the scenario, the government is now significantly involved in objective setting and tying funding to those
objectives. The Director General has responsibility for defining and delivering a strategy within these objectives. There is
evidence that he has gone about this in a ‘top-down’ way and not sought advice from current employees. On the television
programme, employees were particularly critical of a lack of consultation; ‘these proposals have been produced with no
input from museum staff. They have been handed down from on-high’. In many ways, the approach taken at the National
Museum under the new Director General represents the design lens view of strategy. Such an approach is not unusual in
public sector organisations, where elements of strategy are dictated by government manifestos. (bản tuyên ngôn)
Strategy as experience

Strategy as experience provides a more adaptive approach to strategy, building on and changing the existing strategy.
Changes are incremental as the organisation adapts to new opportunities and threats in the environment. The experience
lens views strategy development as the combination of individual and collective experience together with the taken-forgranted assumptions of cultural influences. However, it has to be recognised that the assumptions and practices of the
organisation may become so ingrained that it is difficult for people to question or change them.

This certainly appears to be true for the heads of collection sections at the National Museum. The museum is now facing a
fundamental change in the way it will be funded and the increased influence of the government suggests a change in the
paradigm of the organisation. It seems unlikely that people with a vested interest in the current arrangement and
perpetuating that current arrangement will come up with the change in strategy that is now required. The ‘taken-forgranted’ behaviour of people in organisations is one of the major barriers to developing innovative strategies. Strategy as
experience seems innately conservative. It could work well when a small incremental change is required within a stable
environment. However, this does not appear to be the situation at the National Museum and so developing strategy as
experience may not seem a possible way forward and perhaps this is why the Director General explicitly rejected this
approach.
Strategy as ideas

Strategy as ideas has a central role for innovation and new ideas. It sees strategy as emerging from the variety and
diversity in an organisation. It is as likely to come from the bottom of the organisation as from the top. Consequently, the
organization should foster conditions that allow ideas to emerge and to be considered for inclusion in a ‘mainstream
strategy’. Certain conditions, such as a changing and unpredictable environment foster ideas and innovation.

It could be argued that the macro environmental conditions for adopting this lens are present at the National Museum.
Political, social and environmental influences might lead to new ideas – for example, the relocation of the museum and the
exploitation of on-line access to resources creating a virtual museum. (get from a central role for innovation and new ideas)

The museum is undergoing a fundamental change in priorities and funding and the consequences of these changes is
unpredictable. On the other hand, the museum is a long-established conservative organisation with many symbols of
hierarchy and deference. There is no evidence in the scenario of a group of people generating conflicting ideas and
encouraged to compete with each other in an open and supportive environment(It is as likely to come from the bottom of
the organisation as from the top). The National Museum seems to be dominated by powerful individuals protecting their
own interests (the organization should foster conditions that allow ideas to emerge and to be considered for inclusion in a
‘mainstream strategy’). Finally, a key factor in the selection of ideas is the marketplace. The National Museum is currently
operating in a protected economic environment, although this is set to change.
Conclusion

There is plenty of evidence to suggest that it is difficult to change strategies in a hierarchical or deferential structure. At the
National Museum the Director General decided to pursue a designed strategy. In many ways this appeared to be the natural
lens to adopt given the objectives set by the newly elected government that was beginning to exert its power.

This strategy may have worked if he had been more sensitive to the cultural web and, also, if he had not asked for the
backing of the Board of Trustees. This was always unlikely to be forthcoming given its composition. The paradigm change
means that it is unlikely that the experience lens would have proved fruitful. However, it may have been possible to exploit
strategy as ideas if the Director General had carefully selected heads of collection sections who were relative losers under
the current system.
Q1 Exam bank – Bartok Fuel
a. Describe the approach to strategy that Bartok Fuel appears to have had in the past?

No real evidence of strategic decision in the past (1a)

No mention of corporate mission or objectives for the company (1b)

The development might have emerged from pattern of behaviour rather than any planning process. (1c)

There is an element of logical instrumentalism as the business has not gone far from its origins

It has taken small steps into new areas where it already has some knowledge and expertise

The approach based on practical experience and common sense rather than a strategic planning and was challenged by
Simon as it is unrealistic
b. What factors should the Board to consider before making any decisions on the proposal to dispose of the Working site for
development and to enter the Far East fuel distribution market?
If the Working site is sold for its development potential, this will clearly be a boost to the company’s cash flow. However, as we have
no information about the company’s current financial position, we cannot comment as to whether this is an element of the decision to
sell.
The Board must consider the source of funds received and the sale of working site should be conducted if the sale will generate a
higher return than the garage business currently achieved.
If the Working site is to be shut down there are also considerable human resource issues to be addressed. The division employs 50
people who must either be made redundant or be re-employed in other areas of the business.

The cost of redundancy payments or of retaining must be taken into account

The car dealership appears to be fairly stand-alone element of the business but it must also be considered whether its
closure will have any knock-on effects on the other parts of the economy.
The proposed expansion into the Far East has potential problems. Bartok Fuel has always been a UK based business and therefore
expansion abroad is a major issue. The company has no experience of doing business in any county in the Far East. It knows nothing
of local business condition or regulations. Language and culture are likely to present major difficulties.
All this
In fact, they would be wholly dependent on the probity, efficiency and goodwill of their partners. Real contribution will be to provide
risk capital and brothers must ask themselves if they really see that as their area of expertise – they are not running a bank, after all
Q1-Jun2004
(a) Ray has recently attended a course on strategic planning in hi-tech businesses. He is particularly
interested in the contribution of mission statements to the strategic management process. Explain
the purpose of a mission statement and evaluate the contribution which a mission statement could
make to a company such as NMS. (10 marks)
1 (a) mission statements up to 2 marks each
Identification of purpose, strategy, values and standards of behaviour
contribution to the strategic management purpose
communication to stakeholders
should reflect changing conditions
evaluation of contribution to NMS up to 4 marks
maximum 10 marks
1 (a) Ray Edwards’ recent exposure to mission statements as part of the strategic management process provides a useful
opportunity to evaluate their relevance and value to a small company such as NMS. In some ways, Ray is a ‘walking mission
statement’. He epitomises the values, behaviour, strategy and purpose of why NMS exists.
Mission statements in defining the reasons why the firm exists, what it aims to achieve, how it aims to achieve its purpose and who it
is in business for, can act as a powerful motivating force for the company.
In strategic terms it may clarify the markets that the firm intends to serve, the products and services provided for those markets and
the way they will be reached. In so doing it may define the boundaries of the organisation chosen by the top management. It may also
specify the technologies to be used (perhaps important for NMS) and the competencies it will use to compete in its chosen markets. It
is therefore a combination of ‘hard’ tangible drivers of the business and the ‘softer’ values and behaviours, which will enable the
mission of the business to be achieved.
Ideally, it should have relevance and resonance with all types and levels of employees. It expresses values and beliefs and in
so doing will shape and influence the policies and standards adopted by the firm. They can profoundly influence the attitudes
and behaviour of key stakeholder groups both inside and outside the firm and achieve a consistency of purpose for the
stakeholders.
By their very nature mission statements typically come at the beginning of the rational planning process and thereby facilitate
consistent strategic decisions. However some commentators have argued that you discover rather than invent your mission.
Ray may now be in a position to develop a much more meaningful mission statement reflecting the origins of the company,
his preferences, and the environmental conditions influencing the company together with its resources and associated
competencies and capabilities.
As the organisation grows and develops so its need for a formal mission statement may increase, enabling the direction of
the company to be understood and for more detailed goal setting and planning to be done against a consistent framework.
Its ability to communicate what the firm stands for both to stakeholders inside and outside the firm should not be
underestimated. As such, development of an effective mission statement will take time and reflect changing conditions faced
by the firm.
Mission statements by their very nature are broad in their scope and intended to positively influence the many stakeholders
linked to the company. Effective statements should be brief, adaptable to changing circumstances and clearly show the
distinctiveness of the firm and its mission. Ineffective statements will convince nobody, have little or no impact on, or
relevance to, what the firm does. They may be merely statements of good aspirations and intentions, and used for public
relations purposes to justify actions already taken. Once created, good statements should be re-visited at regular intervals to
ensure they are relevant to the environment the firm is operating in.
Q3.5-Dec-1999
(a) It appears that the stakeholders in the theatre cannot agree on a strategic direction to solve the
financial problems. Mason believes that a mission statement for the theatre could draw the
conflicting parties closer together. With reference to the problems of Salchester Theatre, identify the
major characteristics of a good mission statement, and comment on the problems which Mason may
experience in drawing up such a statement.
1 (a) Mason is likely to have experienced mission statements in his previous employment in manufacturing and in the
university and, having seen them successfully applied in such different areas, thought that one could be appropriate for
Salchester Theatre. Mission statements have been used by many organisations to provide a sense of direction to the
stakeholders. They should provide substance and clarity to a vision showing where the company is and where it is
aiming for. It should enable participants in an enterprise to know how they can help to achieve the corporate goals. He
identified the characteristics of a good mission statement which could guide him in writing one for the theatre.
Campbell and Devine and Young have proposed four components of a good mission. Although each of these four
elements need to be linked with each other, two are oriented on the commercial rationale of a business strategy
(purpose and strategy) whilst the other two (values and behaviour standards) focus more on the less commercial
issues of philosophy and ethics.
Purpose states why the company exists (for the benefits of stakeholders?) whereas the strategy component identifies the
company’s competitive position and its distinctive competence. The value part states what the company believes in
(beliefs and moral principles) and the behaviour standards provides the policies and behaviour patterns which underpin
the corporate distinctive competence and the value system.
The relationship of these four components will help to achieve a cohesive and logical sense of mission. For example
what sort of behaviour might help to achieve the chosen strategy. This could help determine the management style and
the type of people to recruit. Knowledge of this could help Salchester Theatre to become a more integrated type of
organisation. Consequently it is obvious that the values of the organisation and the chosen strategy should help
determine the appropriate behaviour of the members of the organisation.
It is apparent that Salchester Theatre has a major problem. It is not generating enough revenue to cover its costs, either
through earned income or through subsidies. Usually when a commercial organisation is in difficulties the senior
management, after sufficient analysis and thought, will formulate and then implement a strategy for survival. Depending
upon the culture of the company there may be some consultation, but the responsibility and authority for decision-making
rests entirely with the senior management.
In Salchester Theatre there is no such strategic apex. Bernard Mason is responsible for commercial strategy but has little
influence on artistic strategy. This is as if a managing director of a manufacturing company had no control over the
product range or the quality of the products, his only responsibility being to sell them. The difficulty has arisen because
the stakeholders within such enterprises are very powerful. Some exert considerable authority – those who sanction
subsidies – but they rarely have responsibility for managing the enterprise.
There is no unifying culture. Many of the stakeholders have divergent goals. Mason has to attempt to bring together
these groups and focus their attention on a single goal – survival. However even that goal seems to be interpreted
differently by the various stakeholders. The mission statement should include a general statement on the organisational
culture. It should state the main purpose or aim of the organisation and the areas in which it intends to operate. The
mission statement should be reasonably brief, be open-ended and should have no time constraints. The statement
should be a basis for the organisation to formulate goal statements, objectives and short-term targets, and should
provide a unifying basis of communication for those people working within the organisation and those outside it.
The problem with this, however is that it does not directly address the main cause of concern – the stakeholders all
appear to want the theatre to survive, but cannot agree on a strategy to achieve it. A statement which focuses on survival
is hardly inspirational.
Mason must get the stakeholders to identify areas of commonality or agreement between them and recognise that
compromise is essential. Another problem that arises is that there is no common culture to build around. The
actors/actresses appear to have very selfish ideas as to what should be done. They believe that others – the audiences,
the volunteers and the management – should all ‘be educated’ into the tastes and views that they have. There is no
concern for commercial realities – the generation of income. That is someone else’s responsibility – the local council’s or
the Arts Council. This conflict between artistic and commercial goals has bred a confused culture which will not easily be
reconciled.
Similarly when one attempts to define the ‘purpose’ of the theatre there are a variety of interpretations. Both the Arts
Council and the actors would emphasise education, the encouragement of new plays and the development of cultural
activities. However many of the volunteers appear to have more prosaic and unimaginative ambitions. They are looking
for a repeat of old established material which appears to be also popular with the audiences. The local council, on the
other hand, seems to be more interested in attracting wellknown and well-established outside companies to the theatre,
with the intention of raising the profile of Salchester town. Given this potential for disagreement a mission statement is
unlikely to be able to define purpose and areas to operate in, in a way which will satisfy all the stakeholders. It is true that
a short, open-ended and non time-constrained statement could be written so as to be noncontroversial. It could commit
no-one to anything. The statement could be a vague wish list, with no issues which could be construed as being divisive.
Each group of stakeholders could interpret this in a way acceptable to them. However if the purpose of Mason
introducing a mission statement is to facilitate an agreed and co-ordinated strategy then much more preliminary work
needs to be done. The stakeholders must recognise that a single-minded and uncompromising approach to strategy
formulation will help no-one.
The Arts Council, as a major provider of funds, has a duty to ensure that artistic standards are maintained. It does allow
some latitude in the range of presentations which are considered suitable. However it does still have a choice of
withdrawing funding from Salchester Theatre and donating the funds elsewhere. There is no shortage of theatres
seeking help. The group of actor-stakeholders needs to realise that if the theatre does not survive commercially then they
will not be able to present modern productions. They may have to compromise in their ambitions. The volunteers need
also to realise that a continued provision of popular material will alienate the Arts Council, and although income from boxoffice receipts may initially rise this would not compensate for the loss of the Arts Council subsidy. The local town council
could increase their subsidy but this might require an increase in local taxation which could be politically sensitive,
considering that few of the local community attend the theatre. It might be better if they made a marginal increase
in their grant but recognised that the desire to bring high-profile performers to Salchester was creating financial hardship
for the theatre. It would be better to have fewer visiting and high cost performers than to have no theatre at all.
There is room for agreement, and strong arguments are available to persuade stakeholders to compromise in their
wishes. Each group can be partly satisfied but if no group is willing to shift its position then the theatre’s future appears to
be gloomy. A mission statement alone might only gloss over the situation. Initially a compromise position must be
identified and accepted by all. Once this has been done then a mission statement may be introduced and agreed upon.
Only then will it be meaningful.