A Content Analysis of the Mission Statements of United States Firms in Four Industries

Abstract

This study analyzes the mission statements of 57 large U.S. firms for their inclusion of nine components identified in the strategic management literature. We propose that although mission statements provide motivation and direction and are an important way for firms to communicate their corporate identity to stakeholders, firms may be subject to institutional pressures that influence what mission statements contain. We found similar use of mission components across and within four industry environments suggesting that firms respond to stakeholders in similar ways, creating unique industry profiles of mission statements. Introduction Mission statement development is widely considered to be the first step in strategic planning and the basis or starting point for all activities in formulating strategies (Abell, 1980; David, 1989). Despite this importance, however, there is limited and inconsistent empirical research on mission statement content (Bart & Baetz, 1998; Pearce, 1982; Pearce & David, 1987). This study analyzes mission content to suggest that mission statements may be written to portray organizational objectives and values consistent with those of key stakeholders rather than to reveal organizational distinctiveness (Ashforth & Gibbs, 1990). Thus, we predict that mission statement content will be shared by firms. Our study helps to explain why some mission statements are perceived as failing to provide direction and lacking specificity (Bart, 1997; Leuthesser & Kohli, 1997), and why there have been few direct associations between mission content and performance (Bart, Bontis, & Taggar, 2001). Mission Statement Similarities By definition, when published in an annual report or other official document, the mission statement presents a company's unique character or organizational identity (Albert & Whetten, 1985). Both economics and strategic management theorists portray managers as aggressively seeking for their firms to be advantageously different from others (Daniels, Johnson, & de Chernatony, 2002). Nonetheless, successful firms must differentiate themselves from competitors in ways that provide competitive advantage without sacrificing legitimacy, the perception that firm actions are desirable and proper (Deephouse, 1999;Suchman, 1995). Firms must therefore be responsive to their multiple constituents in order to meet the dual demands of task and institutional environments. We suspect that there will be commonalities across mission statements as firms respond to their shared constituents in similar ways. It might not be premature to believe that elements of the mission statement have become institutionalized. Institutional forces lead firms to be similar to one another through coercive, normative, and mimetic pressures (DiMaggio & Powell, 1983). For example, in the twentieth century many organizations adopted the multidivisional organization structure. These adoptions were not because of strategic similarities, but because these firms watched one another, had CEOs from elite business schools, and had interlocking board relations (Scott, 2001). Similarly, we suspect that the mission statement has become institutionalized since it has become ingrained in management education. A Bain and Company survey of 500 firms report that nine out of ten firms use a mission statement, making it the most popular management tool in decades (Bart, 1997). Researchers have shown that large firms regularly include up to nine components in their mission statements (David, 1989). As a result, we suspect that the use of mission components will be used similarly to some degree across many firms. We also expect to find mission statement component usage to be related to a firm's industry because stakeholder recognition might be similar within industries. The norms of mission statement content might vary by industry because organizational fields place different demands in different industries. …

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