Why you need a Vision Statement

By: Mike Ferguson

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In “Business Plans For Dummies”, the authors state a company’s Vision Statement is “a precise set of words that announces to the world what your company hopes to make of itself.” The definition goes on but that sentence is the essence of it. 

In the “One Page Business Plan” the author, Jim Horan, says “a well written vision statement answers the question: What is being built?... in three sentences or less.”

In “Write Your Business Plan”, a lengthy and fairly detailed book put together by the folks at Entrepreneur Magazine asks whether or not you should even have a vision statement.  They answer their own question by saying that if you have a good one, there is no reason not to share it.  Wow, that’s helpful.

Another popular book on an Amazon search, and in my personal library of business plan books, doesn’t even mention a Vision Statement. Hmmm, that’s weird.

Here’s my take: a vision statement is essential. Or to put it another way, having a vision is essential!  What do you want your company to be when it grows up?  As entrepreneurs, whether you are here for the very first time to fulfill a long time goal or because your old company thought they were better off without you, we are all dreamers.  We have something wired into our DNA that brings us to a place in our minds where we see ourselves leading successful, growing companies and successful lives.  Its like that old very basic interview question – where do you see yourself in 5 years?  If you don’t have an idea of what you want your company to become how will you know if you are succeeding?  How will you even make decisions for the future of your new enterprise?

So how do you write a great vision statement?  What should be in it? That’s a loaded question because it needs to contain a lot of information while at the same time be a fairly short statement.  It should address these areas:

• Where will you be in 2 -5 years?

• What will your gross sales be?

• How many people will you employ?

• What geographic areas will you serve and will it expand?

• What is your product(s) and will you expand the line? (Keep in mind that your service is also your product. More on this later.)

• Who is in your target market and will it expand?

Here is the reason I love a great Vision Statement; when I ask what is your vision for your new company and I get an answer that tells me they are thinking smart and big and long term, I get very excited.  You know who else gets very excited? Investors.  Yes, the money guys will look at the books before anything but if the owner doesn’t articulate what their company is capable of then it is a pretty hard sell to get them to want to make an investment.  Don’t be outrageous or ridiculous. Don’t say you plan to put American Airlines out of business in 5 years with your 2 floatplanes taking fly fisherman on day trips to great little spots in the Bahamas.  Don’t be shy about it either. If your plan for your startup is to grow sales by a whopping 5% over the next 3 years you will have an equally hard time finding outside investors.

What did I mean by “your service is also your product”?  It’s simple; a product is easier to sell than a service.  A product has more clarity than a service. My business is a consulting business, which naturally makes you think of a service, but my product is great business plans that help a new entrepreneurs build successful businesses.

My Vision Statement for my company:

Grow Top Dog Consulting into a $500,000 firm in the next 3 years that serves new entrepreneurs wherever they may live with one-on-one consulting to create great business plans and the action steps necessary to get started.  Continue to provide ongoing support to all our clients until they are completely satisfied and on a path that leads to success.  To create an online community of entrepreneurs who offer tips and contacts and other insight to the struggling newbies.