The Importance of Vision for Small Growth Firms

During the early stages of a start-up, sometimes the only thing growth companies have is a vision of future possibilities. Resources may be sparse, operations bumpy, and competition stiff, but if the young growth firm has a clear and compelling vision these obstacles can be surmounted. Fortunately, the vision setting process is generally one that entrepreneurs gravitate toward naturally. Entrepreneurs operate under what leadership experts Jim Kouzes and Barry Posner (authors of the book The Leadership Challenge) call possibility thinking as opposed to probability thinking. The primary difference between the two is that possibility thinking is expansive while probability thinking is limiting. As Kouzes and Posner elaborate: “All new ventures begin with possibility thinking, not probability thinking. After all, the probability is that most new businesses will fail.” Thus, the visioning process is generally not something entrepreneurs struggle with.

So, what defines an organization’s vision and why is it important? Kouzes and Posner aptly describe vision as such: “Visions are about hopes, dreams, and aspirations. They’re about our strong desire to achieve something great. They’re ambitious. They’re expressions of optimism… Visions necessarily stretch us to imagine exciting possibilities, breakthrough technologies, or revolutionary social change.” Jim Collins and Jerry Porras advocate that what separates winning companies from also-rans is not whether they have visions, but rather the scale to which those visions aspire. In their acclaimed book Built to Last, Collins and Porras note that winning companies have 10 to 30 year visions that stretch the bounds of possibility. They refer to these goals as “Big Hairy Audacious Goals” or BHAGs for short. They describe BHAGs accordingly: “A true BHAG is clear and compelling, serves as a unifying focal point of effort, and acts as a catalyst for team spirit. It has a clear finish line, so the organization can know when it has achieved the goal; people like to shoot for Vision 20 reviews finish lines. A BHAG engages people– it reaches out and grabs them. It is tangible, energizing, highly focused. People get it right away; it takes little or no explanation.”

Clear and compelling visions play several important roles for a growth firm. First, vision gives organization members a defined target to shoot for. This is especially important in the early years because young growth firms are rife with ambiguity, both internal and external. Vision helps provide stability during otherwise turbulent times. Eventually, this stability will be derived from mature managerial systems, but early on the entrepreneur’s vision may be all that keeps the organization from spinning out of control. (It’s important to note that the entrepreneur’s vision can also cause the organization to spin out of control if it’s not tempered with disciple.) Second, a compelling vision creates a high octane environment that galvanizes collective efforts. Without something to rally around, it is highly likely that the efforts of folks in young growth firms will grow increasingly scattered and counterproductive and their collective energy will dissipate. A compelling vision keeps efforts aligned, which is especially important as the young growth firm adds new employees. Third, a compelling vision guards against going after the “small wins” that might otherwise turn out to be blind alleys. During the start-up phase it is not uncommon for entrepreneurs to make decisions that are beneficial in the “here-and-now” but that might prove to be bad decisions downstream (e.g., bringing in the wrong investors, partnering with the wrong customers/suppliers, bringing on MBAs who lack the entrepreneur’s passion, etc.) Finally, a compelling vision serves as the focal point of the growth firm’s strategic process. As the growth firm matures and begins adopting a formal strategic planning process, the importance of vision becomes even more profound. In fact vision, coupled with the firm’s core purpose and values form the umbrella under which goals are set, strategies are crafted, resources are allocated, and outcomes are assessed.

A final point regarding vision in young growth firms is warranted. The onus for bringing the vision to life rests squarely on the CEO/founder. If they do not live and breath the vision, constantly expound and reinforce it, the benefits of a compelling vision will go unrealized. Kouzes and Posner discuss the importance of the CEO living the vision as such: “If you don’t care deeply for and about something or someone, then how can you expect others to feel any sense of conviction? How can you expect others to get jazzed, if you’re not energized and excited?” Lastly, the CEO/founder needs to create what Collins and Porras call a vivid description of what attaining the vision will look like. As they explain: “Think of it as translating the vision from words into pictures, of creating an image that people can carry around in their heads. It is a question of painting a picture with your words. Picture painting is essential for making the 10-to-30- year BHAG tangible in people’s minds.”

Setting and living the organization’s vision should not be taken lightly. It’s not enough to have a vision statement, as a neat and tidy statement framed and posted on the corridor walls will get the organization little if anything. Instead, the vision must seep into the very consciousness of all involved in the organization. It must permeate the fabric of the organization. And none of this happens without constant effort and reinforcement from the CEO/founder.

Leave a Reply

Your email address will not be published. Required fields are marked *