The notion of a big hairy audacious goal was first introduced by Jim Collins and Jerry Porras in their book Built to Last: Successful Habits of Visionary Companies. A big hairy audacious goal (BHAG) is a clear and compelling long-term goal guided by a company’s values and purpose.
Understanding a big hairy audacious goal
The notion of a big hairy audacious goal was first introduced by Jim Collins and Jerry Porras in their book Built to Last: Successful Habits of Visionary Companies.
Several key points define a BHAG. The goal must:
- Shift the way the company does business or how it is perceived in the industry. These goals may be audacious or innovative and be the result of out-of-the-box thinking.
- Encourage the company to work outside its comfort zone with confidence, commitment, and even a little arrogance.
- Require little explanation. In other words, people should understand what the company is trying to do with little effort. NASA and its mission to put a man on the moon is one such example.
- Be aligned with organizational strategy, lest it becomes a hollow aspirational statement.
- Be worked toward every day with a sense of urgency, even if it may not be realized for decades.
Creating a big hairy audacious goal
When companies sit down to create a big audacious hairy goal, many make the mistake of not aiming high enough.
Indeed, the goal has to be audacious enough that there is a realistic chance of not achieving it.
To counteract this tendency, it is useful to set a goal with a 70% chance of success.
This encourages the organization to be brave and take a risk, which stimulates progress and forces it to dramatically improve its processes.
With that said, below is a general framework for creating a BHAG:
An idea must first be brainstormed that will change the business, industry, or the lives of consumers.
It’s important to let go of constraints and allow imaginative ideas to be considered.
The idea must be action-oriented, innovative, compelling, exciting, and take a minimum of 10 years to implement.
Run each idea through a feasibility test to determine whether it is something the company can realistically fund.
This may be the hardest part.
Commitment means the goal is broken down into smaller parts and work is started as soon as possible.
Progress should be monitored over the years to ensure the organization does not lose interest in its goal.
To that end, the goal should be measurable and have a clear finish line.
This motivates employees to work toward a defined endpoint.
Big hairy audacious goal examples
Here is a look at a few big hairy audacious goals from notable companies or organizations:
- General Electric – “Become #1 or #2 in every market we serve and revolutionize this company to have the speed and agility of a small enterprise.”
- Walmart (1990) – “Become a $125 billion company by year 2000.”
- Starbucks – “Become the most recognized & respected consumer brand in the world.”
- Amazon – “Every book, ever printed, in any language, all available in less than 60 seconds.”
- Microsoft – “A computer on every desk in every home.”
- Stanford University – “Become the Harvard of the west.”
Big Hairy Audacious Goal examples
Here are some Big Hairy Audacious Goals (BHAGs) from some well-known companies.
In a 2006 conference where Bill Gates announced he would be spending more time on his philanthropic endeavors, the billionaire businessman took the audience back to when he and Paul Allen founded the company over 30 years ago.
“We talked about a computer on every desk and in every home. It’s been amazing to see so much of that dream become a reality and touch so many lives,” Gates explained.
In the second example, take yourself back to 1952 and imagine you are a member of Boeing’s management team.
The company’s engineers have a BHAG to build a large commercial jet aircraft despite:
- Zero presence in the market and several previous attempts that ended in failure.
- Expertise in military aircraft only.
- Little interest in Boeing’s jet-powered product from the few commercial airline companies that did exist in the 50s, and
- An estimated development cost of three times the company’s average annual after-tax profit for the past five years. At the time, this equated to around 25% of Boeing’s total net worth.
Despite these immense obstacles, Boeing’s vision was to “Become the dominant player in commercial aircraft and bring the world into the jet age.”
The Boeing 707 made its maiden flight on December 20, 1957, heralding a new era in air travel.
Walmart’s BHAG to become a $125 billion company by the year 2000 is one we mentioned earlier that deserves a more detailed explanation.
While this particular BHAG is now well documented, a lesser-known fact is that Sam Walton had a history of setting audacious goals.
In 1977 he set out to reach a $1 billion valuation and then, in 1990, wanted to double the number of Walmart stores by the end of the millennium.
When the original goal of making Walmart a $125 billion company was slated in 1991, critics believed the odds of reaching this objective were slim.
Walmart had around $30 billion in revenue at the time and it was doubtful whether it could continue to grow at a suitable pace.
Adding to these doubts was the fact that Walton had recently stepped down as CEO and handed the reins to David Glass – a man lacking in charisma who did not inspire the confidence of others.
However, history will show that Glass led Walmart to a $125 billion valuation. He even managed to pull off this Big Hairy Audacious Goal two years ahead of schedule.
In the 1960s, Nike had a simple BHAG: “Crush Adidas”.
At the time, Nike was an obscure company known as Blue Ribbon Sports with only one shirt and one pair of shoes in its product lineup.
Adidas, on the other hand, was the dominant player in the sportswear industry.
The two companies have been locked in an incessant battle ever since.
While Adidas retains some degree of market leadership in Western Europe, Nike is dominant in the USA and its global revenue of $46.3 billion in 2021 was almost double that of Adidas.
- A big hairy audacious goal is a clear and compelling long-term goal that requires innovative thinking. The concept was first introduced to the world by Jim Collins and Jerry Porras.
- A big hairy audacious goal must change the landscape of a business or industry and requires that employees work outside their comfort zones. These goals must also be self-explanatory and easily understood.
- Big hairy audacious goals have been set and then accomplished by visionary companies such as Amazon, Microsoft, Starbucks, and Walmart.
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