Tag Archives: vision

CVS Lives up to its Mission by Banning Cigarette Sales

Tobacco

While nearly every large public corporation has a mission statement that explains its values and direction, not every corporation lives up to its mission. This can be particularly difficult when social responsibility conflicts with profitability.

Case in point: CVS Pharmacy, the second largest pharmacy chain in the U.S.

Last year CVS stopped selling tobacco products, and declined to enter the growing e-cigarette market. A year after the move, CVS released research that it claims shows how its decision encouraged Americans to buy few cigarettes. In states where CVS has a 15% market share, there was an overall market drop of 1% in sales of cigarettes. While 1% might seem very small, it represents an estimated 95 million packs of cigarettes, or five fewer packs per smoker and a substantial contribution to the diseases associated with tobacco. Corresponding to the drop in cigarette sales, sales of nicotine patch products increased 4%.

The move cost the company an estimated $2 billion in revenue. There may a cost to social responsibility, but the gain benefits the larger society and shows us that mission is important to strategy.

Group Activities and Discussion Questions:

  1. Discuss the importance of mission and vision in the strategic planning of a company.
  2. Bring up CVS’ Web site and social responsibility statement: http://www.cvshealth.com/social-responsibility
  3. The CVS press release can be viewed at: http://www.cvshealth.com/content/cvs-health-marks-first-anniversary-tobacco-removal-new-data-decision’s-impact-extends
  4. How does the company’s action to quit selling tobacco products match its mission?
  5. Discuss the difficulty of taking potentially profit-reducing action in order to meet mission.
  6. Divide students into teams. Have each team select a company that interests them and have them locate the company’s mission and values statements. Do these companies match the statements?

Source: Bloomberg, Brandchannel.com, other news sources

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The question: “Why?”

TED

What makes a company great? It isn’t just profitability or growth. There are many companies that achieve both of those, yet still remain mired in negativity or conflict. And, what makes a great leader? It isn’t just managerial skills, it’s something that goes beyond, something that inspires and resonates with people – especially customers.

In this TED Talk, Simon Sinek attempts to answer the question of ‘why’ and explain how great leaders inspire action. His concept: the golden circle. At the center of the golden circle is the answer to the ‘why’ question.

Every organization knows ‘what’ it does, but very few know ‘why’. Making a profit isn’t enough to answer ‘why’ – profit is a result, not a purpose. The ‘why’ needs to focus on the purpose, the cause, and the beliefs. It should be why we get out of bed in the morning and attempt to make a difference in the world. People don’t necessarily buy ‘what’ you do, they buy ‘why’ you do it.

Group Activities and Discussion Questions:

  1. Start by asking students to define what makes a company great. Ask students if there are companies that they will not shop at – and ask why. On the other side, ask if there are companies that they will shop at – and ask why. What makes these companies different?
  2. Discuss the importance of leadership in organizations and how having a clear mission, vision, and values impacts organizations.
  3. Show the video: http://www.ted.com/talks/simon_sinek_how_great_leaders_inspire_action
  4. Following the video, divide students into teams. Have each team review the mission/vision/values of an organization of their choosing. (Good companies for this are Tom’s Shoes, Warby Parker, and Quirky.)
  5. Next, have the teams write mission/vision/values for a new company.
  6. Write the statements on the board and discuss the implications to the organization and to its customers.

Source: Ted.com

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