BHAGs [Big Hairy Audacious Goal] have animated great leaders throughout history, who have used them to stimulate progress and galvanize people. It doesn’t really matter whether you call it “mission” or “BHAG” or anything else that works for you. What matters is that you commit to something that meets the tests of a BHAG. Ask yourself the following questions about any BHAG:

• Do you and your people find the BHAG exciting?

• Is the BHAG clear, compelling, and easy to grasp?

• Does the BHAG connect to the purpose of the enterprise?

• Is the BHAG undeniably a goal, not a verbose, hard-to-understand, convoluted, impossible-to-remember mission or vision “statement”?

• Do you have substantially less than a 100 percent chance of achieving the BHAG yet at the same time believe your company can achieve the BHAG if fully committed?

• Would you be able to clearly tell if you’ve achieved the BHAG?

The best BHAGs make you think big. They force you to engage in both long-term building and short-term intensity. The only way to achieve a BHAG is with a relentless sense of urgency, day after day, week after week, month after month, for years. What do you need to do today, with monomaniacal focus, and tomorrow and the next day and the day after that to defy the probabilities and ultimately achieve your BHAG? If you’re going to put a powerful computer in every pocket, or eradicate malaria, or give every kid a solid K–12 education, or cut crime rates by 80 percent, or render impotent the dark forces of terrorism, or build the most admired company in your industry, or accomplish whatever the goal might be, you cannot possibly achieve the BHAG in mere days or weeks or months. The best corporate BHAGs require 10 to 25 years of relentless intensity to achieve.

The Process

Setting strategy involves the following basic steps:

First, review the vision of the company. If you haven’t clarified your vision, do so. In particular, ensure that the current mission is clear. As you recall from Chapter 4, your mission (which is the third component of vision, after core values and beliefs and purpose) is analogous to the specific mountain you are going to climb.

Next, do an internal assessment of the company’s capabilities. This is analogous to examining capabilities and resources of the expedition team.

Third, do an external assessment of the environment, markets, competitors, and trends. This is analogous to studying pictures of the mountain, examining weather reports, assessing new trends in technology that might help you in your ascent, and paying attention to competitors who seek to reach the summit ahead of you.

Finally, taking the internal and external assessments into account, make key decisions about how you intend to go about achieving your current mission. This is analogous to mapping out the route you are going to take up the side of the mountain.

Guided by a set of Core Values and a purpose, it chooses a Big Hairy Audacious Goal (BHAG®)* to achieve in the next 10 to 25 years. To break up the journey, the leadership team sets a series of three- to ve-year targets divided up into annual goals. These are further broken down into specific actionable steps the business takes over the next few weeks or months, adjusting tactics as the market conditions dictate.

BHAG is a registered trademark of Jim Collins and Jerry Porras.*

Employees can articulate the following key components of the company’s strategy accurately. You want all employees to align their actions with the strategy of the company. To do this, they need to know and understand the company’s 10- to 25-year goal (BHAG®); who the core customers are; the three Brand Promises everyone needs to keep; and what the company does — and be able to explain it when asked (the elevator pitch).

1. Core Values: the handful of rules defining the culture, which are reinforced through your People (HR) systems on a daily basis.

1. Core Purpose: the top leader’s regular stump speech to keep everyone’s heart engaged in the business.

3. Big Hairy Audacious Goal (BHAG®): the 10- to 25-year goal that provides constant context for all of the decisions made throughout the organization.

1. Priorities/Themes: a handful of three- to five-year, one-year, and quarterly priorities, which require repeated review on a daily and weekly basis to keep them top-of-mind.