Retail mission statements: top 100 global retailers.

Author:Anitsal, Ismet
 
FREE EXCERPT

INTRODUCTION

Organizational communication is vital for both internal and external publics (Leuthesser and Kohli 1997; King, Case and Premo 2010). Specifically, global retailers communicate with multiple stakeholders at multiple fronts. They use mission statements as an overall guide for their employees (associates) helping customers. In terms of customers (clients), they utilize mission statements as a way to build long lasting relationships. This is also true starting point for global retailers in terms of how they maximize shareholders' (investors) wealth and serve communities for their well being.

Many high-performing firms owe their performance to engraving their vision and mission statements in the hearts and minds of their people (Ahmad and Chopra 2004). A firm can try to influence its reputation positively and therefore position itself within its marketplace (Chun and Davies 2001; van Riel and Balmer 1997) by communicating its identity (Barnett, Jermier and Lafferty 2006) in its mission statement. Building corporate identity involves a management process of building corporate personality through corporate philosophy and values (Stuart 1999) and often included in the corporate web site of firms, accessible by all stakeholders (Chun 2004), to form their online brand personality. Therefore, mission and vision statements are important media for conveying these values and emphasizing uniqueness (Leuthesser and Kohli 1997; Yamauchi 2001).

Mission statements serve as an important strategic tool in forming an identity and guiding a direction for an organization (Falsey 1989; Campbell 1997; Leuthesser and Kohli 1997; Denton 2001; Mullane 2002; Williams 2008). In mission statements, organizations declare "the reason for being" (David 2009; King, Case and Premo 2010), define themselves as "who they are" and "what they do" (Falsey 1989), and broadly share their world views with multiple stakeholders as what they aspire to accomplish based on how they define their business (Drucker 1974; King, Case and Premo 2010). Sometimes organizations refer to such statements as mission statements; while other times, they title the same or similar statements under different names such as mission, corporate principles, company philosophy, core values, or credo (Williams 2008). Mission statements can be as short as a single sentence or as long as a page in the case of theme based statements. However, it should ideally be longer than a phrase and shorter than a two-page document (David and David 2003).

Green and Medlin (2003) find a significant positive relationship between the completeness and quality of organizations' mission statements and their financial performance. David and David (2003) indicate that according to a Business Week report, companies with well-crafted mission statements incurred thirty percent higher return on certain financial measures than companies that did not have well-crafted mission statements. They conclude that the overall lack of completeness in mission statements exists for companies in the computer, food and banking industries. In addition, Sattari, Pitt, and Caruana (2011) criticize that the mission statements of the one hundred Fortune 500 companies that they studied are not readable because they are written for an audience of a university graduate level.

Components of mission statements have been analyzed continuously from different perspectives in different contexts (Bart 1997; Bart and Baetz 1998; Bart and Hupfer 2004; Anitsal, Girard, and Anitsal 2012a). Pierce (1982) identifies eight components in mission statements: customers, products/services, markets, technology, concern for survival, growth and profitability, philosophy, self-concept, and concern for public image. Wheelen and Hunger (2000) develop nine criteria to ensure the quality of a mission statement: purpose, products/ services, competitive advantage, scope of operations, philosophy, vision, sense of shared expectations, public image, and emphasis on technology, creativity, and innovation. Williams (2008) analyzes the mission statements of the Fortune 1,000 firms and finds that high performing firms included in their mission statement eight of the nine recommended components more than did the lower performing firms. Three of the components--survival, public image, and employees--were included significantly more often by the high-performing firms. The recommended information components include customers, employees, products/services, markets, technology, distinctive competence, philosophy, desired public image, and concern for growth and survival (David and David 2003).

Because significant differences have been found between high and low performing firms (Williams 2008), across industries (David and David, 2003) and based on how well-developed companies' mission statements are, the present authors further investigate the mission statements of top 100 global retailers and conclude with several comparisons between the mission statements of the top 100 global retailers and the top 100 U.S. retailers. The authors believe that even if some of the top 100 global and the top U.S. retailers belong to both groups, there may still be prominent differences in their mission statement that make them stand out from the rest of the retailers that do not belong to both groups.

FRAMEWORK

The 4Ps of marketing; namely product, place, promotion, and price, appeared as a model to organize thought in marketing literature long time ago (Shostack 1977; Booms and Bitner 1981). Recognized differences of services compared to products encourage researches to add three more Ps (participants, physical evidence, and process) into this model.

Because products include both tangible goods and services, even ideas, any referral or description of services in mission statements of top global retailers will be categorized as product in this research. The second P includes, place or distribution element that involves making products/services available when and where customers want them. Information regarding accessibility will be classified under place. Promotion involves referral to all communication activities through traditional and non-traditional media. Price as an economic variable may be communicated as low, reasonable or competitive price. Price may also be referred as a psychological variable under "value." Both of these references will be categorized under the price element.

Participants/people are extremely important in services marketing. This variable includes not only employees but also customers, shareholders and general public (van Nimwegen, Bollen, Hassink, and Thijssens 2008; Anitsal, Girard and Anitsal 2012a). Physical evidence is the tangible elements of the service, and that global retailers provide to their stakeholders. Any referral to physical facilities, including stores or distribution centers and non-physical spaces, such as websites, Facebook or Twitter, will be categorized under physical evidence. Finally, processes are essential elements of service that customers need to understand to be able to function efficiently and effectively in the co-production of the service. These processes include activities such as actual procedures, work flows, guidelines, and social responsibility. Components of mission statements referring to operations will be categorized under processes.

To build long-term relationships with customers, employees, shareholders and the community, retailers can use the elements of the services mix in their mission statements to promote their corporate identity to firm's stakeholders. Therefore, this paper focuses on the examining the applications of the seven Ps of services mix to mission statements. The next section will describe the methodology of this study.

METHODOLOGY

The sample for this study is based on an annual list provided in "Global Powers of Retailing Top 250" prepared by Deloitte and STORES Media published by the Stores magazine in January 2011, sponsored by the National Retail Federation. This study covers the top 100 global retailers based on their total sales revenues around the globe. Top five global retailers include Wal-Mart Stores, Inc. (U.S.); Carrefour SA (France); Metro AG (Germany), Tesco plc (UK) and Schwarz Unternehmens Treuhand KG (Germany). Those global retailers made $405.0 billion, $119.9 billion, $90.9 billion, $90.4 billion and $77.2 billion in retail sales in 2009, respectively. The remaining global retailers come from a diverse background in terms of the store formats such as hypermarket, supercenter, superstore, cash & carry, warehouse club, discount store, home improvement, drug store/ pharmacy, electronics specialty, convenience store, and e-tailer. In terms of country of origin, El Corte Ingles, S.A. (Spain), for example, operated department stores in 84 countries, while 28 global retailers had operations in only one country.

The mission statements data were collected from the web sites of top 100 global retailers by a graduate student in the fall semester of 2011. Thirteen retailers were identified as privately held companies such as Schwarz Unternehmens Treuhand KG, Aldi Einkauf GmbH & Co. oHG, Edeka Zentrale AG & Co. KG, Groupe Auchan SA, Centres Distributeurs E. Leclerc and J Sainsbury plc. A total of seven mission statements could not be obtained because either the company website and/or contact information for clarification could not be located for two Japanese, two French, one German, one Italian and one Finnish global retailers. Researchers emailed 31 global retailers in English, French or German for their mission statement information, only 12 retailers responded as of the writing of this paper. Four retailers stated that they do not have a formal or declared mission statement. Instead they provided their company principles or philosophies that have been substituted as their mission statements in this study. As a result, 78 mission statements of global retailers...

To continue reading

FREE SIGN UP