Entrepreneurial vision: 1. Introduction

2004-01-26 08:30:00 Allan Engelhardt wrote in CYBAEA Journal:

The last thing IBM needs now is a vision.

Lou Gerstner, CEO IBM, August 1993

When Lou Gerstner joined IBM as its new CEO, he famously quipped that the last thing IBM needs now is a vision. Four or five years later, the company announced a new vision symbolized by the letter “e” and backed by a huge advertising campaign. Four or five years after that we were told, again through a massive advertising campaign that is still with us, that the company's vision was expressed in the “On Demand” tag line.

This is clearly abusing the term “vision”. A vision doesn't change every few years. A company's strategy for achieving the vision may change every four or five years, and its portfolio of products and services and the markets in which it sells them may change more frequently. But the vision is, or should be, the guiding principles that steers the company through a changing marketplace without loosing its identity.

What Mr. Gerstner intended to say with his statement was that the problem IBM was facing was primarily in execution. IBM had the core capabilities to succeed in the market, at least in the short term, and management focus had to be squarely on realizing these immediate opportunities. Time spend sitting around the round table articulating and communicating a shared vision for the company was management time wasted.

The vision was Mr. Gerstner. It was his vision that eventually became articulated and communicated as executable strategy through the letter "e" and the “On Demand” messages.

This situation, where the company vision is embedded in a single person, is typical in start-up companies and turnarounds; what Mintzberg in the Strategy Safari [references in a later post] calls the entrepreneurial strategy school. Typically, these companies are characterized by being both deliberate and emergent: deliberate in the broad lines and in what the founder or leader want to achieve but emergent in the details of how this is implemented, allowing for flexibility and experimentation.

This manifests itself as a strong vision and a rapidly changing approach to how this vision is executed in the business environment, just like we saw with IBM.

The company vision is especially important for entrepreneurial companies both for the successful execution of this phase of the company and critically for the transition to the next stage of the company development. Entrepreneurial companies include start-up and turnaround companies, but also established organizations that face disruption in their markets through innovation or other events.

This role of the company vision is what we consider in this note.

Tomorrow: What is a vision?

[*] Bookmark on Delicious [*] Share on LinkedIn [*] Share on reddit

Subscribe to CYBAEA Journal

Jump to comments.

You may also like these posts:

  1. [0.67] Entrepreneurial vision: 2. What is a vision?

    At its simplest, a vision is a representation of the companys core values and purpose – its identity, if you like – combined with a visualization of the companys envisaged future. The vision serves both to provide inspiration and a sense of what needs to be done; a guiding principle. In entrepreneurial companies, the vision is often a mental representation created in the mind of the founder or leader. Our five points for a successful core ideology are that your vision should be: Lasting and unattainable (the 100+ year plan, no matter what happens) Unattainable and inspiring (the guiding star) Inspiring and limiting (what we do and what we don’t do) Limiting and motivational (why do we go to work?) Motivational and lasting (a reason, now and tomorrow) Warren…

  2. [0.56] Entrepreneurial vision: 6. Who needs a vision?

    At heart the purpose of discovering and articulating the vision for the organization is very simple: it is to achieve long-term commitment. Commitment from employees, investors, customers or other people associated with the organization. This leads us to a very simple set of situations in an organizations evolution where the articulated vision becomes not merely useful but essential , namely when A startup company grows beyond the immediate circle of the founders The company is seeking new or additional investment capital The company is in a turnaround situation

  3. [0.49] Entrepreneurial vision: 6.1. Growth of a startup company beyond the immediate circle of the founders

    The development of an articulated vision is in our experience an important milestone in an organizations development. It shows that the organization has evolved beyond the clique and has responded to the need to bring cohesion of purpose to a larger group.

  4. [0.47] Entrepreneurial vision: 6.2. Company is seeking new or additional investment capital

    In essence, every company that is seeking capital is a startup company. Much focus is placed on the business plans in the presentations to the investors, and rightly so. But in the final analysis, the business plan is only a gatekeeper and the investors are betting their money on the management team and their ability to execute. The vision, as defined in this series, is one way of communicating the focus and, yes, dreams of the management team.

  5. [0.46] Entrepreneurial vision: 3. How to discover your vision

    Typically, a company discovers its vision. It is not something you can create. It is certainly not something you can fake. The key question is “what is our vision” not “what should it be”. A vision, the core ideology for your organization has to be authentic or it is meaningless and will only be a source of cynicism as opposed to coherence.

  6. [0.46] Entrepreneurial Vision: 7. Summary

    The components of an effective vision are: Vision – the reason for the existence of the organization, its raison d’être . Core values – the fundamental beliefs to which an organization subscribe. Core purpose – the vision statement summarizing the organization’s fundamental reason for being. Envisioned future – the shared vision of how the world will be different because of the organization’s activities, typically looking 10–50 years ahead. Long-term goal – a bold objective for the organization. Vivid visualization – a powerful image of what the future will be like when the long-term goal is achieved. The situations when a vision is essential Whenever an organization is seeking long-term commitment, especially when: A startup company grows beyond the immedi…

  7. [0.41] Entrepreneurial vision: 5. The envisioned future

    A vision is good. It gives cohesion to the organization and provides shared values. But to really mobilize the organizations you need a strategic goal (or possibly a few goals). The vision is unachievable and permanent. Your goal achievable and temporal. …

  8. [0.34] Entrepreneurial vision: 4. Bringing it all together

Join the discussion

Do you agree or disagree? Have a question of want to make a point? Join the discussion:

There are no comments yet. Be the first to comment.