“You’ve got to think about big things while you’re doing small things, so that all the small things go in the right direction.” Alvin Toffler
The essence of strategic planning is taking the big picture and boiling it all the way down to what needs to be done today. If we don’t have a big picture to guide us, or if the big picture is so big that we can’t translate it into day to day actions, then we are responding to whatever comes our way. We are relying on luck.
Over the past decade the concept of the Big Hairy Audacious Goal (BHAG) has become popular in strategic planning circles. The phrase comes from a book published in 1994, Built to Last: Successful Habits of Visionary Companies by James Collins and Jerry Porras. In it they examined the practices of 18 successful companies including Marriott Hotels and Wal-Mart.
Once a devotee, I’ve dropped the BHAG as a planning device. My problem with using a BHAG is that it is so often misapplied. Yes, many very large, very successful companies have audacious goals but a BHAG is not something dreamed up at a weekend strategic planning retreat. A BHAG comes from the core of a company’s values and aspirations. It is something that appears over time as an entrepreneur or group of executives work toward achieving more modest goals like getting the business past the point of struggling to make payroll every two weeks.
J. W. Marriott started out with a root beer stand in 1927. He grew it into a chain of restaurants by 1932. While he likely dreamed of a local restaurant chain when he opened that root beer stand, a vision of owning a worldwide chain of hotels came much later.
Sam Walton started his retail career as an employee of J.C. Penny from 1940 till 1942. After serving in the US Army, Walton purchased a Ben Franklin variety store in 1945. He and his brother, Bud built a chain of sixteen stores in Arkansas, Missouri and Kansas. The first Wal-Mart opened in 1962. While it is known that he wanted to work in retail from an early age, Wal-Mart as we know it today wasn’t envisioned until much later.
A BHAG can still be part of our long term vision but if it is so big that it can’t be translated into a motivational and inspirational tool that drives our actions then it is not a useful planning device.
For most of us, a three year big picture vision is much more likely to be useful in our day to day activities. All of us, entrepreneurs, executives, managers and workers on the shop floor can imagine three years out. We can transpose what has already happened into what could happen.
Everyone in the organization can align themselves with a three year big picture. That makes for a useful planning device.
Doug,
This is a great post. So much of the published leadership thought can actually cause more harm than good. Nice post.
Mike…
Thank you, Mike. Your kind words are really appreciated.
Doug
Doug,
Your acronym captures well my memories of many management team directives for long-term ‘vision’ planning, reports and off-site retreats. While these initiatives can undeniably provide some value, too frequently, the result of these efforts is yet another ‘great plan in a binder on shelves filled with great plans in binders.’
I will now have some back-up support if I need to decline participation in any (i.e., Big Hairy Audacious Goal) initiatives.
Thank you for your helpful post today.
Joanne Maly
Joanne, thanks so much for your comment!
Doug
Excellent post Doug. I too have seen this concept misapplied as seems to happen with so many concepts that “catch on”. While the notion of a BHAG is about realizing extraordinary possibility, all too often when a BHAG is revealed by the executive team it is perceived to be a pipe dream by the very people who are called upon to execute. While the job of the executive team in casting the vision involves a great deal of enrollment in the vision as a real possibility, it seems to me the BHAG’s that emerge “from the core of a company’s values and aspirations” as you put it are the only ones that people can truly get behind with both their hearts and minds.
Great perspective on BHAG. I like to start with a vision of where we want to be in X years, then work backwards to determine what needs to be in place today, tomorrow, etc, to make that vision a reality. Makes it more real and actionable.
Beverley McClure
Fresh Perspectives LLc
Thanks for your comments, Susan, and thanks for checking out my blog!
Doug
Thanks for your comments, Beverly, and thanks for visiting!
I like your take on BHAG, Doug. For many companies, the idea is that “audacious and huge” are good all by themselves. And the BHAGs described in Built to Last, where the term originated were more tactics than strategies.
I just worked on a study of companies that have been successful for decades. One thing that jumped out at us was that they all had a strategy that was not a plan, but a simple concept. Wal-Mart, whom you used as an example, pursued a simple strategy that might be summed up as “Deliver everyday low prices to customers through increasingly effective purchasing and operational efficiency.”
What I’ve come away with is that the entire concept of “strategic plan” might be a relic of earlier ages. What most great businesses seem to have is a strategic concept that defines how they compete and how they make money and a variety of tactics.
Thanks for visiting, Wally. “Strategic concept” is very interesting. Have you written anything on it? I’d love to learn more.