Are you confused about vision and mission statements? Is there is difference between vision, mission, purpose, and credo? How do you create these statements and how do they really help the company? Do you really need them, or are they just statements that hang on the wall of your office?

If you've read the usual bunch of business books, you probably know that companies need statements of vision and purpose to guide them to success. But if you're not sure of the difference between vision, purpose, mission, credo, and goals, where do you start? Good question. Here are some quick definitions of the Vision, Purpose, and Values (VPVs) to get you started. Based on our interviews and research, every great organization has a set of inspiring, larger-than-life VPVs that guide it on a daily basis.

Vision: The vision is the ultimate goal or destination of the organization. In truly great organizations, the vision is so far into the future as to not be achievable in a single lifetime, yet so inspiring that everyone in the organization never stops trying. A truly great vision also seeks to improve the world in some way, or free the world from some limitation. For instance, Grameen Bank in Bangladesh aims to create a poverty-free society. In other words, the vision answers the question of, "What is our organization here to achieve?"

Purpose: The purpose answers the question of, "How will our organization achieve its vision?" We're not talking about nitty-gritty business tactics here, but the major method or path the organization will walk to achieve its vision. Grameen Bank insists that financial credit is a human right, and works to create a poverty-free society by offering micro-loans to anyone, regardless of their current financial situation. Grameen Bank answers the question of "how" by offering credit as a human right. It's their primary path for achieving their aim, and all other objectives, goals, and plans are centered around this chosen path.

Values: Values are the boundaries and ethics that keep the organization on the path. Values define the organization's character, and help the organization make decisions. In today's business climate, characterized by companies like Enron and Worldcom, ethical behavior is more important than ever. Grameen Bank has four values: courage, discipline, unity, and hard work. These four values define everything the bank chooses and does, and bank workers and borrowers (alike follow these values or they lose the privilege of being associated with the bank.

For instance, to receive loans borrowers, mostly women, must have the courage to start their own businesses with the micro-loans from Grameen Bank, often in the face of outraged husbands and religious leaders. Borrowers must also have the discipline to follow the Sixteen Decisions, borrower-created rules that raise living standards, and the unity to meet with four other borrowers and their banker weekly to discuss business plans and progress. Finally, everyone must work hard. Conditions are tough in Bangladesh, and both borrowers and bank officers often work more than 12 hours a day under harsh conditions. Despite the apparent difficulty of following these values, the bank has seen the positive effects of such ethics. Furthermore, Grameen Bank's influence is worldwide including branches even in the advanced countries like the United States. Today Grameen Bank has 2.4 million borrowers and loaned out more than $3.5 billion dollars, and 98% of borrowers have paid their loans back in full!

In short, to create a truly effective foundation for success, you need a strong set of VPVs. These VPVs tell you what your organization is here to achieve, how you will achieve it, and how you know you're behaving ethically. Great organizations achieve their vision, but they never cut corners or stray from the straight and narrow. They achieve their greatness by being ethical.