Big Hairy Audacious Goal (BHAG) is the term coined by James C Collins and Jerry I Porras in their well known book “Built To Last”. Visionary Companies set Big Hairy Audacious Goals (BHAGs) that raise the bar and inspire people across all levels.
According to Collins and Porras: “A true BHAG is clear and compelling, serves as a unifying focal point of effort…It has a clear finish line, so the organization can know when it has achieved the goal. It is tangible, energizing, highly focused. People get it right away; it takes little or no explanation.”
BHAG is a goal, not a statement and it has a clear finish line. It’s a highly focused, tangible, and energizing goal. They typically take a 10- to 30-year commitment, but they are exciting, tangible and something everyone just “gets” without any further explanation. BHAGs only help an organization as long as it has not yet been achieved. Once attained, BHAGs must be replaced. BHAGs need a high level of commitment of the organization. It never occurs to them that they can’t do what they plan to do.
Most businesses have goals, but there is a diﬀerence between merely having a goal and becoming committed to a huge, daunting challenge. Visionary companies formulate a core ideology / value that is based on two parts; to stimulate progress and preserve the core. BHAGs are developed to stimulate progress within the organization
Here are some good examples of BHAG vision statements from companies you might know:
- Boeing: “Become the dominant player in commercial aircraft and bring the world into the jet age. ”
- Walt Disney: “Build Disneyland – and build it to our image, not industry standards. To be the best company in the world for all ﬁelds of family entertainment.”
Rockwell: “Transform this company from a defense contractor into the best diversified high-technology company in the world.” (1995)
General Electric: “Become number one or two in every market we serve and revolutionize this company to have the strengths of a big company combined with the leanness and agility of a small company.” (1980s)
Giro Sport Design: “Become the Nike of the cycling industry.” (1986)
Watkins-Johnson: “Become as respected in 20 years as Hewlett-Packard is today.” (1996)
Phillip Morris: “Knock off R.J. Reynolds as the number one tobacco company in the world.” (1950s)
Nike: “Crush Adidas.” (1960s)
Ford: “Democratize the automobile.” (early 1900’s)
- Amazon: Every book, ever printed, in any language, all available in less than 60 seconds. Also: Earth’s most customer centric company.
- Google: Organize the world’s information and make it universally accessible and useful.
- Microsoft: “A computer on every desk and in every home.”
A BHAG should be consistent with the company’s core ideology. It should be so clear and compelling that it must require little or no explanation. It must get people excited and pumped up. A BHAG should fall well outside the comfort zone. While it is important for people in the organization to believe they can pull it off, it should require tremendous effort. A BHAG should be so bold and compelling in its own right that even if the organization’s leaders disappeared, it would continue to inspire progress.
Importance of BHAGs in business are:
- A Big Hairy Audacious Goal (BHAG) is one that really stretches you to think differently about how you do business.
- It’s the goal that is going to help you transform your business, rather than being satisfied with incremental change.
- It’s the goal that’s going to inspire you to do your best work and outshine your competition.
Qualities of Big Hairy Audacious Goals (BHAGs)
Set correctly, BHAGs work. But how do you do that? Taking clues from Collins and Porras, a good Big Hairy Audacious Goal (BHAG) has four qualities:
- Aligned. Properly set goals can be transformational if they’re tied closely to what is most important to the organization.
- Audacious. BHAGs are a breed apart. You’re probably on to something if the first reaction to a BHAG is “impossible!” BHAGs can’t be achieved easily or quickly. They demand diﬀerent thinking.
- Articulate. A good BHAG is a clear target. And it’s real. It’s not in any way a fanciful statement disconnected from the business. Kennedy’s 1961 mission to “land on the moon by the end of the decade” needs no further detail.
- Arduous. Easy goals don’t require innovation. A good BHAG does. It’s achievable, but only through diﬀerent thinking, real struggle, and a dash of luck. If it’s truly impossible—as opposed to perceived as impossible—people will disengage from the process entirely.
Types of Big Hairy Audacious Goals (BHAGs)
- Target BHAG: goal focused on a specific market segment. E.g.: Become a $125 billion company in sales in 5 years. Wal-Mart: (1990), To reach 23 billion in sales in five years. Goodyear Tire & Rubber Co.
- Common Enemy BHAG: goal focused on “crushing” the competition. E.g.: Crush Adidas. Nike (1960), We will destroy Yamaha. Honda (1970)
- Role-Model BHAG: goal that uses another respectable organization as a role-model. E.g.: Become the HARWARD of the west. Stanford University,1940
- Internal Transformation BHAG: goal to change or alter how the organization is perceived. E.g.: Become the company most known for changing the worldwide poor – quality image of Japanese products. Sony (1950)