All companies have goals, but many of the most successful companies set Big Hairy Audacious Goals (”BHAGs”). There is a big difference between merely having a goal, and being fully committed to a huge, daunting challenge–like a mountain to climb.
Far better to dare mighty things, to win glorious triumphs, even though checkered by failure, than to take rank with those poor spirits who neither enjoy much nor suffer much, because they live in the gray twilight that knows not victory, nor defeat. - Theodore Roosevelt
President Kennedy set a BHAG for NASA when he said “this Nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to earth.” This was bold and outrageous, yet achievable.
Like the moon mission, a BHAG is clear, compelling and serves as a unifying focal point for the company, individual or organization. BHAGs engage people and often create immense team spirit. In setting a BHAG, the company should ask: Does it stimulate forward progress and momentum? Does it get people’s juices flowing? Do team members find the BHAG stimulating, exciting and adventurous? Are team members willing to throw their hearts, souls and creative energies into the BHAG?
In 1990 Sam Walton set a BHAG that Wal-Mart would reach $125 billion in sales. At the time, the largest retailer in the world had reached $30 billion. The only corporation which had attained a sales volume close to $125 million was General Motors.
Boeing gambled their entire company on a BHAG to build their first commercial jet airplane, the 707. Walt Disney gambled everything on Snow White as a full-length, animated feature film. IBM made an all-or nothing investment in the IBM 360 computer. Tom Watson Jr. wrote about the IBM 360 decision:
There wasn’t going to be much room for error. It was the biggest, riskiest decision I ever made, and I agonized about it for weeks, but deep down I believed there was nothing IBM couldn’t do.
The following are concluding key points from Built to Last about BHAGs:
- BHAGs have clear finish lines so everyone can know when they are achieved. However, it is very important for companies to set a new BHAG once the first is achieved to avoid a stagnation or paralysis of “we’ve arrived.” A BHAG only helps an organization as long as it has not yet been achieved.
- A BHAG should be so clear and compelling that it requires little or no explanation.
- Team members should clearly believe that they can and will reach their BHAG. Built to Last says that “It simply never occurred to them that they couldn’t do what they set out to do.”
- A BHAG should be exciting on its own. If a BHAG doesn’t get the team members’ juices flowing its not a BHAG. A good BHAG will survive the departure of a founder or CEO, as was the case with Wal-Mart.
- A BHAG should be completely outside the company’s comfort zone. It should require heroic effort to achieve.
- BHAGs should be consistent with the company’s core ideology and company needs to be careful to preserve its core while pursuing its BHAG.
Find Built to Last: Successful Habits of Visionary Companies
(Source: Built to Last)
Posted on April 15th, 2008 by admin
Filed under: Book Reviews, Business Management, Entrepreneurship, Leadership, e-Business
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