The MHC Blog

Powerful Business Insights for Succesful Leaders
MHC-InternalPagesBlog-1920-1080-c.jpg
bhag.png

Why do we need a BHAG?

In his book “Good to Great”, Jim Collins’ research found that all great companies had developed and pursued a goal through time that was so challenging they might not know how they would accomplish it when they first set out, it was likely to be thought as impossible by anyone outside the Company, but was internally regarded as completely possible.  Jim Collins called this goal a “Big Hairy Audacious Goal” or BHAG for short.

To have an exciting and achievable plan - either personal or business - you need to identify a BHAG. Something so inspirational that you (if this is a personal plan) or your Employees (for a Company plan) can get fired up over.  Something that gets the juices flowing, something challenging and yet fulfilling and totally possible if you put everything behind it.

 The power of the BHAG is that it gets you out of thinking too small. A great BHAG changes the time frame and simultaneously creates a sense of urgency. A really good BHAG tends to have a 10 to 30-year time window, a distance far enough away that you do not need to know today how you are going to do it, it should inspire enough to discount this and lead the Company strategy set for the coming decade(s).

You look at it and say, oh my goodness, if we’re going “become the #1 consumer brand on the planet (Starbucks)” or “put a computer on every desk and in every home (Microsoft)” or “become a $125 billion company by year 2000 (Wal-Mart), then we must get to work today with a level of intensity that is unrelenting. 

The only way you can achieve something that big is with an absolutely obsessed intensity and focus that starts today and goes tomorrow and the next day and the next day and the next day for 365 days and then for 3,650 days - that’s how you do it.

One of the roles of the BHAG is that if it’s good and big enough, you cannot achieve it unless you build a great company and a great organisation. If you think back to JFKs 1961 announcement to Congress to “send an American safely to the moon before the end of the decade”, to do this NASA had to really operate at a superb level to achieve it by 1969. A BHAG helps you build a great company, because if you don’t have a great company you can’t achieve the BHAG.

Your own Company BHAG need not be as dramatic as a walking on the moon, but it should have the same traits characterised by Kennedy's vision. Aside from audacity, a good BHAG should meet 3 criteria:

  1. A Company BHAG should have an extensive time frame, ranging from 10 to 30 years. "Doubling sales in five years” is too short a goal - 10 years is a nice time frame. A personal BHAG can be completed in a shorter time frame “I will have walked the 14 day trek from Kathmandu to Everest Base Camp by the time I have reached my 40th birthday”.  Remember that as the years go by, the BHAG date gets closer, when setting a BHAG, we recommend being more specific on the date i.e. by the year 2030, otherwise 10 years remains 10 years, your never making steps towards it.

  2. It should be clear, compelling and easily expressed in plain English. "If you need a wordsmith to read the statement, it isn't a BHAG" Collins says. A great example of a clear BHAG is GE’s corporate goal of being “first or second in every market it serves or get out”. To test your BHAG's clarity, Collins suggests you try saying it using different words but without changing the meaning.

  3. Jim Collins recommends using the 3 circle approach (hedgehog concept) when forming your BHAG - you consider the following:
    • What you are deeply passionate about – The BHAG should be consistent with your company's values and purpose, supporting them rather than going against them.
    • What you can be the best in the world at
    • What drives your economic engine

You can decide what your BHAG ought to be by talking the over the Company goals with your managers and employees.  Be patient, listen to all suggestions and wait for the right idea to surface. The way a good BHAG usually happens is when somebody in the room says it out loud and the room immediately become alive, excited and focused on how they can all help achieve it.

What if you don't have a BHAG now? Not to worry, says Collins, not every company, nor even every great company, has a BHAG. Big, hairy, audacious goals focus Companies on specific objectives. If a Company is doing what it takes to be better, it doesn't really matter why it's doing it. The key is to stimulate progress, he says. A BHAG helps you do that.

As we are heading towards 2018 planning, it’s now a great time to start thinking about how a BHAG can help focus the business planning process.

 

Share it:

Claire Donnelly

Written by Claire Donnelly

A Business Growth and HR Strategist helping medium size companies to Scale Up using proven systems. Claire is an MCIPD qualified Human Resource professional, with 25+ years’ experience working within various industries and 10 + years’ experience of HR practices throughout the Middle East. As a HR Generalist she has held a number of senior and Board level HR positions. She is experienced in working at both strategic and tactical levels.

We Would Love to Hear from You...

Recent Posts