What if your company’s vision hinders your ability to earn money?
Running a company can be challenging, and having a clear vision is one of the most important factors that can determine its success. I recently heard this advice from James E. Miller, II, the CEO of Vision Investment Group Inc., during his guest appearance on the business podcast “Between Data and Risk”. Miller is highly regarded for his expertise in helping companies and their leaders grow and scale. During the interview, he emphasized the critical role of having a vision in running a company, and this article explores some of his key insights. Additionally, it discusses what to do if your vision conflicts with the need to generate revenue.
Know where you are headed
A clear vision is essential for providing direction and clarity of goals for the company. It defines the company’s long-term aspirations and sets a path for where it sees itself in the future. This statement is critical in guiding the company’s decision-making process and serves as a roadmap for its growth.
Attract the right people
Having a clear vision is not only important for the management but also for the regular employees of a company. A clear vision helps define the company’s values and culture, which attracts like-minded individuals to work for the company. It also motivates employees to work towards a common goal. When employees understand the company’s vision, they can align their personal goals with the company’s vision. This increases their job satisfaction and sense of purpose, leading to increased productivity and better results. So, having a clear vision is a win-win for everyone involved!
Attracting employees is not the only benefit of having a clear vision. A well-defined vision statement can also help in attracting investors and customers. Investors are more likely to invest in companies that have a clear direction and a plan for growth. By communicating the company’s potential to investors, a clear vision statement can increase the chances of securing funding. Additionally, a clear vision can attract customers who share the same values and beliefs as the company.
Big ideas cost money
Running a company involves more than just having a vision; it also requires profitability. Although a company’s vision provides direction and motivation to stakeholders, the need to earn money is equally critical. Sooner or later, the company will face instances where its vision conflicts with its profitability goals. Should the company stick to its vision at any cost? How can a company balance its vision with the need to earn money?
Entrepreneurs can adopt various strategies to balance a company’s vision with the need to earn money. One approach is to keep your vision realistic. Avoid grandiose ideas, even if they sound cool — your budget may not be ready for them. It is better to stay modest and down-to-earth by setting goals and ideals that are at least attainable.
On the other hand, everyone needs a sense of great purpose. It might be a good idea to keep a multi-level vision that states both long-term and high-profile goals, as well as more achievable everyday principles.
Another strategy is to plan your budget more carefully. Consider setting up a special fund with the goal of keeping your company on the right course in line with your defined vision. For example, a company that values sustainability can invest in research and development to create eco-friendly products that are also cost-effective. It is crucial to recognize that sticking to your ideals can come at a cost! Cheap solutions are often dirty ones, either in terms of reduced service quality or poor working conditions for employees. If you want to maintain your work and moral standards while also competing with providers of “cheap solutions,” you need to secure some funding first.
The cake trade-off dilemma
In conclusion, having a clear vision is essential for running a successful company. It provides a sense of purpose and direction, inspires employees, and attracts investors and customers. A company’s vision serves as a guiding principle that significantly impacts its success.
However, while having a well-defined vision is vital, profitability is equally important. Balancing vision and profitability often leads to the classic “have your cake and eat it too” dilemma. Aligning a company’s vision with profitability goals can be challenging, especially with changing market conditions and plenty of competition that have long ago sold their “visions” for an extra penny.
Moreover, the challenges one faces when balancing the vision and profitability are typically financial ones, which often lead to a conflict of interest with investors. As a result, many company visions today serve as a fig leaf to cover up some of the dirty compromises.
To stay true to your ideals, take your company’s vision seriously and hope that your investors do the same. Don’t let short-term financial goals overshadow long-term objectives, as the pressure to demonstrate profitability can lead to decision-making that sacrifices the company’s vision.
To hear more about the importance of vision in your business, listen to the interview with James E. Miller II on “Between Data and Risk” or watch it on YouTube.
Also, make sure you check out the “Between Data and Risk” publication on Medium for a critical look at the latest ideas and technologies in business.
