Every organisation benefits from a commonly understood, organisation-wide long-term goal. By formulating a BHAG (or ‘big hairy audacious goal’), a statement can be given that helps an organisation to focus on a single common goal. The BHAG was first introduced by James Collins and Jerry Porras in their book Built to Last. To formulate a BHAG you need to answer three questions: what are you deeply passionate about; what can you be the best in the world at; and what drives your economic engine? Your answer to all three questions at once will be your BHAG: an inspiring direction for the organisation’s future (Figure 4.1).
Many organisations set out ambitious goals they hope to accomplish over the coming years. These goals are also intended to align the activities of the organisation, to guide decision-making and motivate employees to work together more effectively. A BHAG addresses just that: what will be the next great and inspiring leap forward for the company? The intended effect of this common long-term goal is to give purpose and a positive outlook on the future to the organisation.
Figure 4.1 BHAG
Source: after Collins and Porras (1994)
The BHAG model invites you to answer three questions:
By first answering each of the questions and then comparing and combining those answers, the BHAG is shaped. Ultimately there will be a shared understanding of what the BHAG is for the organisation. It is not necessary to formulate it as a catchy one-liner, although often this is the final outcome of such an exercise.
Not only does a BHAG help to state a common long-term focus for the organisation, but the process of formulating the BHAG also allows you to think explicitly about the raison d’être of the organisation. This can be useful to fundamentally reconsider the strategy and business model of your organisation. As the process of formulating a BHAG can be very inspiring, it can help to set a fertile ground for ‘reinventing’ your organisation.
The downside to the BHAG is that it requires both a lot of creativity and flexibility during the formulation stage and a lot of discipline from those involved. The process could easily turn into people trying to impress each other with soundbites, instead of discussing the fundamentals of the organisation among themselves.
Collins, J. and Porras, J. (1994) Built to Last: Successful Habits of Visionary Companies. HarperBusiness.
Collins, J. and Porras, J. (1996) ‘Building your company’s vision’. Harvard Business Review 74(5), 65–77.