BHAG or Bust: The Power of Big Goals

12-March-2013 21:23
in Mission, Vision and Goals
by Admin

There is currently some debate as to the value of goals.  For the record, I am a big believer in the power of goals to drive behaviour and boost the performance of both individuals and organisations.  I do understand, however, the arguments against goal setting that have gained some prominence in recent years.  Adam Galinsky for example, a professor at Northwestern University's Kellogg School of Management, intelligently argues that "goal setting has been treated like an over-the-counter medication when it should really be treated with more care, as a prescription-strength medication." He argues that goal setting can focus attention too much or on the wrong things and can lead people to participate in extreme behaviors to achieve the goals.   

Having sounded that note of caution, I strongly recommend to almost anyone that will listen to set and strive towards a BHAG.  For the uninitiated, the term BHAG (pronounced Bee-hag), was coined by Jim Collins and Jerry Porras in their classic book "Built to Last".  It is an acronym that stands for Big Hairy Audacious Goal and refers to a  clear, compelling and ambitious goal that will change the very nature of a business's existence.  Collins and Porras described a BHAG as nearly impossible to achieve without consistently working outside of your comfort zone and displaying consistent commitment, confidence and even a touch of arrogance.  BHAGs are bigger, bolder and more powerful than regular long and short term goals. They typically take a 10-year commitment or more to actually achieve, but they are exciting, tangible and something everyone just “gets” without any further explanation.

Jay Arthur, the author of "Lean Six Sigma Demystified",  provides a great example of a successful BHAG.

”During the second world war, when cargo ships were at a premium, Liberty ships required almost 250 days to build.  As the demand increased, the builders were asked to create ships much faster.  Eventually they innovated the design and building of the ship and got the average to 40 days, about 20% of the time it took when they started.  This wasn't because of learning gains; it was because the U.S. had a BHAG to build ships much faster.  Setting the BHAG demanded that the shipbuilders think differently, organize differently and work differently.  It also created a sense of urgency to know that their work was driving the war effort.  If it can be done in shipbuilding, it can be done anywhere.”

For those of you that want some inspiration from existing businesses with which you are familiar, here are some examples:

  • Amazon: Every book, ever printed, in any language, all available in less than 60 seconds.
  • Google: Organize the world's information and make it universally accessible and useful.
  • Microsoft: A computer on every desk and in every home.

So, how can we develop a BHAG for our small businesses?  I recommend that using the following three-stage process to tap into the power of the BHAG.  

1. Conceptualise It

The first step is to take the time to set a goal that meets the criteria of a BHAG.  A BHAG is different from a more conventional goal in the following ways:

  • It is ambitious to the point of seeming almost unbelievable.
  • It is a goal that will take a minimum of ten years to achieve.
  • It is a goal that demands and inspires action, especially attempts at innovation.
  • It generates excitement and energy amongst those who will commit to it and is sufficiently compelling to sustain high levels of excitement and energy over time.

This part of the process is invariably the most difficult.  It can take weeks or even months for you and your team to settle upon a goal that is important enough to you and the business to qualify as a BHAG.

2. Test It

Once you have settled on a BHAG, it's time to do some "Back from the Future" thinking.  You need to break the BHAG down into smaller, more manageable chunks of time and set interim goals that collectively add up to the BHAG that you have chosen.  So, if you have created, as has a friend and associate of mine, a BHAG of creating a billion-dollar per year globe-straddling company within the next ten years, you will need to know where the business will need to be at the end of the ten year period in order to achieve that and then outline a plan including annual goals that will, if achieved, take you from where you are now to where you aspire to be with your BHAG.

This part of the process will help you determine several important things:

  • Is the goal measurable and can you define, however vaguely right now, a path to it?
  • Will this BHAG require you to develop new competencies and to operate consistently outside of your current comfort zone?
  • Does your BHAG create momentum within yourself and your team once it is understood what is involved in achieving it?
  • Do you still feel excited as you start work on achieving your BHAG and does it create energy as you begin to move towards the accomplishment of your interim goals?

After you have gone through this process, you will have a good idea of whether this goal really is a BHAG and is something that you can dedicate the next ten years of your life to achieving.

3. Commit To It

For me, the acid test of whether an individual or organisation are truly committed to a BHAG is whether or not they regularly review their progress against their plan.  I would recommend that progress against plan is reviewed at least monthly and that the BHAG is discussed at all important meetings.  The BHAG needs to become a part of the business culture, with the entire organisation aware of it and the role that they as an individual have to play in making it happen.  Business systems and day to day processes need to be adjusted or even completely redesigned in order that consistent action will be taken towards achieving the BHAG.  The reality is that big goals will likely remain elusive unless the business builds a system capable of delivering them.  However, once the wheels of cause and effect start turning in your business, your BHAG becomes something more than wishful thinking.

I believe that the era of the "me-too" business is coming to an end.  As Seth Godin famously observed, the businesses that will thrive in the modern era “stand out like a purple cow in a field of brown cows”.  As small business owners with a desire to succeed, we must stop doing business as usual—like every other company—and “dare to be great.”  In order to do that, we need to develop extraordinary goals that we then support with extraordinary business systems and processes.  Feel free to contact us here at Continuous Business Planning to see how we can help start your business out on the road to extraordinary success.  As Henry David Thoreau puts it:

"If you have built castles in the sky, let not your dreams go to waste; Just build the foundations under them."

Make the commitment to achieve the extraordinary today and tap into the power of big goals.  Once you decide it's BHAG or bust, your business and life will never be the same again.