Let's begin our exploration of the strategic management process with the end in mind. What do we aspire to become? Some owners and managers cringe at this idea of mission, vision and values, from its association with large bureaucracies that spew a bunch of meaningless words. But rest assured, when properly considered and fully integrated. These words can have a meaningful impact on strategic alignment, employee motivation and corporate culture. Few people undertake a business solely for the money.

Money is a important and wholly necessary outcome of any business endeavor. But what else is there? What else is special about your organization? What else do people like about your business? What are the aspirations to grow your business? These are all strategic questions that can be asked to tease out purpose aspirations and objectives for the organization.

The more you drill into the motivations of executive is an owners of the business, the more you're going to recognize mission, vision and values. And once determined, you'll tend to notice that these don't change very often. But their importance cannot be understated because our long term success and organizational greatness, if you will, will ultimately hinge upon whether these ideas, concepts and visions can be uniformly shared amongst our stakeholders both internally and beyond. Now, Simon Sinek shared his idea of golden circles during a TED talk presentation, which resonated with the way I was thinking about mission, vision and values. His golden circles are an attempt to explain why some organizations succeed and others fail. What he noticed is that the successful organizations are very good at reflecting and sharing the why of their existence.

Why is the first thing they communicate with employees, customers investors, the why explains and paints Very good picture of why the organization exists, why it's different, why it cares and so on and so forth. The next layer to communicate is the how of what they do. How do they develop their products? How do they deliver their services? How do they interact with each other, and their customers and so on and so forth. And the final layer is reserved for the what, what do they produce?

What are the features of the product? What is the price, the human brain evaluates information and each of these rings very differently. The what information, which describes our product or service is processed by our logical mind. That part of the brain is used to process facts, figures and interpret language. Aristotle refer to this as our logos, the how and the why information is evaluated by an entirely different part of our brain that is used to make decisions and establish trust and Aristotle refer to this part of our brain as a Athos and ethos, in other words, your emotional mind and your credibility. This part of the brain is far more influential on human behavior and decision making then logos.

Let's consider an example to illustrate the difference. A computer company that focuses on the what message will communicate to its customers. We make great computers that come with such and such wonderful features at this incredible price. You should buy one, I asked you, do you feel convinced? Instead, imagine another computer company that positions itself entirely different using the principles of the Golden Circle. This company shares this message that says in everything we do, we believe in challenging the status quo.

We do this by making products that are simple to use and beautifully designed. We happen to make computers do you want to buy one? So hopefully you can recognize that this message is appealing to another part of us. And interestingly, most people will be influenced more by the second messaged in the first, even though it's telling us actually less about that product. After the company makes a path post an ethos connection with its stakeholders, it can add on new products, new businesses new ideas without ever changing the inner golden circles. When we think about defining our future state, we should keep this idea in the back of our mind.

The goals we choose and the way we envision working together helps to attract like minded people, be they employees, owners, or customers. So let's take what we've learned about human cognitive psychology back to developing your mission, vision and value statements. Mission defines the purpose of your organization. This is an announcement to the world of why you exist. Vision isn't audacious statement of what you want the organization to become. This should be a sexy seductive statement designed to pull people together in new To send like a tractor beam.

And together these statements strike at the heart of why, when they're written in a way that taps into our ethos and pathos to create stronger motivation and alignment, carrying on values speak to our strongly held beliefs, values established desired behavior for our people. These beliefs and behaviors dictate the how of work performed, which is different than the what of work performed. And finally, we have strategies and objectives. Strategy is your game plan to maximize your positioning in the marketplace. Your objectives are statements of what you need to accomplish to fulfill the mission and vision. Notice how strategy and objectives have less emotional feel to them.

That's because they're speaking to the what are the golden circles, and it doesn't make them any less important but without the context of mission, vision and values. They lack excitement, they lack emotional connection. One last example to consider consider The infamous words of Martin Luther King Jr. When he said, I have a dream. If Martin Luther King Jr. had said instead, I have a plan, I asked you would the world be different today? This simple example, exemplifies the difference between a bunch of meaningless words and a call to action.

A few organizations do this extraordinarily well and have created competitive advantage around this emotional connection its people feel working with each other, and with customers. Consider Southwest Airlines, Toyota, Apple Starbucks, among a handful of others. In this lesson, we have talked about defining the future state. There is more of an art than a science to making this valuable step in the strategic management process, and it certainly helps having a visionary leader. More money is always the easy answer to defining our future objectives, but it's almost never the right answer. Our next lesson we're going to reverse our attention and assess our current state.

Until then,