What Is a Business Compass and Why Is It Important?

Back in 2011, I read an article in the Harvard Business Review magazine entitled “The Power of Collective Ambition” (by Douglas A. Ready and Emily Truelove) that introduced a concept called the Business Compass.

The business compass is a simple diagram that shows very clearly what your business does, why it does it and how it will get it done.

The diagram brings together into one integrated picture the organization’s Vision, Mission, Values, Strategic Goals and Operational Priorities, Brand Promise and Leadership Behavior. It provides extreme clarity for anyone who is wondering what the organization is all about.

After reading the article, I applied the concept to the business I was running and was impressed with the focus that it brought to the organization. A diagram of the model and the definition of its components are described below. You can download the Business Compass Visio template from the Business Tools page.