Podcast Ep 87 | How to Avoid These 5 BHAG Mistakes

What com­mon mis­takes are lead­er­ship teams mak­ing with Big Hairy Auda­cious Goals?

If your BHAGs aren’t alive, dri­ving growth and inspir­ing the team, then you’ve prob­a­bly gone down the wrong path. BHAGs should be like a North Star that helps guide you.

If a goal is wor­thy of the next decade of your team’s cre­ative effort, you feel great about it, and dri­ving towards it encom­pass­es intrin­sic rewards — then you’re on your way.

In this pod­cast, Kevin Lawrence and Brad Giles dis­cuss why Big Hairy Auda­cious Goals mat­ter, and how to make sure they are ingrained in the hearts and minds of your people.

EPISODE TRAN­SCRIPT

Please note that this episode was tran­scribed using an AI appli­ca­tion and may not be 100% gram­mat­i­cal­ly cor­rect – but it will still allow you to scan the episode for key content.

Brad Giles 00:12

Hi there, and wel­come to the Growth Whis­per­ers where every­thing that we talk about is build­ing endur­ing, great com­pa­nies. As always, today I’m joined by my co host, Kevin Lawrence, who lives in Van­cou­ver, and I live in Aus­tralia. Kevin, Hel­lo, how are you doing today?

Kevin Lawrence 00:30

Today’s a great day where I got to get out and, and hang out with some, some fam­i­ly and get out in a boat and get around town, do a few things. Have some time to get orga­nized for the week, because it’s my Sunday.

Brad Giles 00:54

Good to hear. So as always, we’d like to start with a word or phrase of the day, what might you have today?

Kevin Lawrence 01:03

I would say is the mag­ic of mod­ern sci­ence. Oh, my mom was going through some health stuff right now. And she’s had a pret­ty rough week. And what’s amaz­ing is how quick­ly the med­ical sys­tem and sci­ence and how they know how to help peo­ple. Like it’s incred­i­ble. They can quick­ly diag­nose things, fig­ure things out. And you know, you trust it’s quite easy, at least to trust, that there’s very, very high­ly capa­ble peo­ple that can deal with almost any sit­u­a­tion. So I’m just real­ly impressed by doc­tors and nurs­es. And that’s a field that I could­n’t ever see myself doing. But just yeah, the what sci­ence is capa­ble of doing is spec­tac­u­lar. And I’m very in awe of what they can do.

Brad Giles 01:46

That’s good. I’m fas­ci­nat­ed to see how you’re going to stitch these two togeth­er as you nor­mal­ly do. Mine is about dig­ging into the num­bers. And I’ve got a client we were work­ing ear­li­er today. And we dis­cov­ered that they’ve switched from b2b to b2c mod­el. They don’t real­ly have a lot of com­pe­ten­cies in that area. And we dis­cov­ered that when they’re talk­ing to a cus­tomer, and the cus­tomer says no, in fact, we’re just let­ting them go, rather than putting him into some kind of mar­ket­ing fun­nel to because it’s no it’s real­ly short for not right now. And so we want­ed to we iden­ti­fied that and we’ve built that out. And you know, we could real­ly, per­haps even dou­ble our con­ver­sion rate. So that’s, that’s what’s on my mind today. Love it.

Kevin Lawrence 02:37

So it’s using them is how using num­bers to help improve the mir­a­cles of mod­ern sci­ence, because they use a lot of data. Yeah, there’s a lot of data. So it’s num­bers and sci­ence, and how they work togeth­er to come up with bet­ter con­clu­sions. A bit of a week. So togeth­er, but we’re gonna run with it. So let’s dig into today. This is a top­ic that will be a lot of fun today, and a short one

Brad Giles 03:09

We have not yet spo­ken about big hairy, auda­cious goals on the pod­cast. So today, we’re talk­ing about the five main big hairy auda­cious goal or BHAG mis­takes, the five main BHAG mis­takes, because we, you know, for a lot of peo­ple, they know the phrase has become com­mon in busi­ness cul­ture, obvi­ous­ly coined ini­tial­ly by Jim Collins. Yeah. But so many times I see peo­ple just butch­er BHAGs.

Kevin Lawrence 03:52

Yeah, that we see. And so let’s just start with defin­ing what a BHAG is a big, hairy auda­cious goal. It’s it’s a goal that’s meant to lead a com­pa­ny into the future. And what Collins found in his research and Good to Great, the Great, good, great or built the last. One of those two ear­li­er books is that the endur­ing great com­pa­nies, one of the things that he found is that many of them had B hags were in the com­par­i­son com­pa­nies they did­n’t. And the whole idea is it’s a mas­sive goal of what yeah, what you want to be when you grew up, but they’re usu­al­ly, you know, pret­ty, pret­ty, pret­ty hairy and auda­cious. Like, they’re real­ly, real­ly things that you can’t see hap­pen­ing with lots of orga­ni­za­tions that are run with them. And we first set them It almost takes peo­ple’s breath away, and they peo­ple can’t even believe it. But it’s a mas­sive mech­a­nism to be a cat­a­lyst to stim­u­late progress and keep peo­ple real­ly engaged. Much like, you know, the US had that that ver­sion of it was like to put a man on the moon. Right? Yeah, a human on the moon would be a more appro­pri­ate way to say it today. But that was an ini­tial­ly it was a B hag where they just they said we Want to do that and they ral­lied like crazy. And you know, most peo­ple believe that they did it. You know, there’s always the peo­ple who believe things did­n’t hap­pen, but you know that they have the they have video footage and that they achieve that mas­sive goal.

Brad Giles 05:13

Yep. So Jim Collins has this Yin Yang sym­bol I’m sure you’ve all seen the Yin Yang, it’s a cir­cle, and it’s got one side of it is black. And once I’ve it is white, one side says, pro­tect the core. So that’s about the val­ues and the pur­pose and the ide­ol­o­gy. The oth­er side is stim­u­late project progress. A part of that stim­u­lat­ing progress is this big, hairy, auda­cious goal. I like to say to teams, when we’re set­ting and B hag that there’s per­haps a 70% chance that we could hit it A and then B, there’s some­one in the room who’s kind of mut­ter­ing, I think you guys might be a lit­tle bit insane. Like that sounds a lit­tle bit too far out there. Now, does­n’t mean it needs to be com­plete­ly unre­al­is­tic. But it needs to be auda­cious with­in it. Yes. Def­i­n­i­tion. Yeah,

Kevin Lawrence 06:01

absolute­ly. So we got, you know, five points here to real­ly are five com­mon mis­takes. Num­ber one is that it’s gen­er­al­ly entre­pre­neur who’s moti­vat­ed by rev­enue, and they pick the well, we’re going to be $100 mil­lion com­pa­ny or a bil­lion dol­lar com­pa­ny, two of the most com­mon ones that we see. But there’s that’s not tied into any­thing. Besides, we’re just going to do big num­bers. That’s not I mean, look, if that works for you, please go ahead. We fight hard not to have that because based on real­ly doing it, well, it should sit right in the cen­ter of what Collins calls your hedge­hog prin­ci­ple. Hedge­hog is kind of three inter­sec­tion inter­sect­ing cir­cles in a Venn dia­gram. And it’s What can you be the best in the world at? What do you deeply pas­sion­ate about, and what dri­ves your eco­nom­ic engine or what he calls prof­it per X? No, a prof­it dri­ver in your com­pa­ny now fig­ured out your hedge­hog is your own his exer­cise, and we nor­mal­ly set that ini­tial­ly before we do the B hag, but the B hag should be right in the mid­dle of all those it should, it should relate nice­ly to all of those things. Doing 100 mil­lion of rev­enue or a bil­lion of rev­enue does­n’t relate to much of that.

Brad Giles 07:14

Because in terms of under­ly­ing strate­gic log­ic, all that we’re doing is say­ing, what’s the next biggest incre­men­tal num­ber? And then we’ll just call that our goal. So there isn’t an under­ly­ing set of Yes, pre­vail­ing evi­dence and log­ic that can tell us how, why that makes sense. So it when, as prac­ti­tion­ers for many decades, between the two of us, we look at these types of big num­bers, like 100 mil­lion or a bil­lion as just being this is just like, pri­ma­ry school, this is just this is yes.

Kevin Lawrence 07:53

What does it No, it says, it just says, we’re gonna get big, which is not a bad thing. But when you do it through the Hedge­hog, you’re apply­ing a strate­gic fil­ter to it and weav­ing it into the strat­e­gy of your busi­ness. So that’s the first big mis­take is it does­n’t fit into or relate to your hedgehog.

Brad Giles 08:11

So what I like to say on that is, imag­ine that the Big Hairy Auda­cious Goal is a moun­tain that we’re climb­ing. And the Hedge­hog is like you’re dri­ving a car up the moun­tain, that the Hedge­hog is the guardrail that stops us falling off the moun­tain. So the hedge­hog main­tains the dis­ci­pline through that jour­ney over and over like time, yeah, over time. And there­fore, to reverse engi­neer that when we begin to set the be hag, what we’re doing is we’re look­ing, and we’re say­ing, If we main­tain dis­ci­pline at the cen­ter of that Venn dia­gram, for 10 to 30 years, where could that pos­si­bly take us and that’s how we set

Kevin Lawrence 08:50

the goal some way, awe­some way to put it. And so that’s the next piece num­ber two, the mis­take peo­ple make is they get the time­frame wrong. Oh my god. And now it’s meant to be 10 to 25 or 30 years, which means it’s far enough in the future that log­ic should­n’t pre­vail. It should­n’t be about log­ic. So there’s two mis­takes on the tim­ing one, peo­ple don’t think far enough out, and they have a three to five year goal, right, or a short term goal. That’s not what this is. It’s meant to be very far in the future. So you can think big, dream big, and not be caught up in today’s envi­ron­ment. The sec­ond mis­take that peo­ple make on that is they pick a spe­cif­ic date, they’re going to achieve it. And they say we’re gonna achieve, you know, 2500, what­ev­er it hap­pens to be by 2025 because it rhymes and it sounds good. The one thing I’ve seen with B hags and I think we had a con­ver­sa­tion with this before, but what I’ve seen is to be able to pre­dict the year where you land it. It’s incred­i­bly, incred­i­bly dif­fi­cult. And espe­cial­ly when you’re look­ing that far out to plan how some­thing’s going to land in 12 to 15 years. Good luck, you know, and And so that’s the sec­ond mis­take. So the two mis­takes, not hav­ing a long enough time frame, and to pick­ing a spe­cif­ic year.

Brad Giles 10:09

So many times I’ve heard peo­ple say, so our BHAG is in three years to do X, or in five years to do X. Okay, that’s not a BHAG, that’s just a three year goal or a five year goal. And that’s fine, it’s good to have those things. But it’s it, it is a com­plete­ly dif­fer­ent con­ver­sa­tion to think this is what we want to achieve in 10 to 30 years, acknowl­edg­ing that there’s a 20 year gap in between, this is where we want to get this is the moun­tain that we’re climb­ing, this is not a short term goal, three years will come around quite quick­ly. So you know, you, that’s a fun­da­men­tal rule there. So let’s move on to num­ber three. They don’t know or Cape aren’t capa­ble of mak­ing it hap­pened. So there has to be a con­nec­tion with­in the Hedge­hog, of what you can be the best in the world at so that’s drawn from your com­pe­ten­cies, what are you com­pe­tent in achiev­ing? Now, maybe you could buy in anoth­er, anoth­er busi­ness, you could acquire a busi­ness to help with that. But how can we con­tin­ue on this path, exe­cut­ing relent­less­ly on the bor­ing basics and con­tin­u­ing to get bet­ter around what we can be the best in the world at what dri­ves our prof­it per X ray, our sole kind of eco­nom­ic prof­it focus, and what we’re deeply pas­sion­ate about? That con­nects to that first one, but you’ve got it, if you can’t be the best in the world at it, then it can’t form a part of your core business.

Kevin Lawrence 11:45

Yeah, so there’s two mis­takes peo­ple make. One is that they’re not focused on things that are in their capa­bil­i­ties, ie, things that they’re amaz­ing at and can be the best in the world that they’re focused on. Sec­ond­ly, is that they lim­it them­selves based on those same things as well. Because if you can see a nice lit­tle easy path to get your B hag, it’s not right. It should chal­lenge your exist­ing capa­bil­i­ties. And there should be mas­sive holes in your plan that you don’t know how to fill yet. So this should be mas­sive. So with­in your capa­bil­i­ties, but dra­mat­ic stretch­es and big gaps, because if it’s too easy, it’s not going to get you to make you’re not going to make the changes required to con­tin­ue to get bet­ter and bet­ter and move towards that behind. So we need to real­ly chal­lenge you, although I real­ly chal­lenge you on stuff that you’re good at.

Brad Giles 12:37

The fourth mis­take is the big hairy, auda­cious goal actu­al­ly inspir­ing? Is it some­thing that peo­ple think that’d be awe­some if we could do that? Because if your bag is sim­ply some­thing like, we’re gonna sell 2 mil­lion pairs of glass­es, that that might be just a num­ber, but does it actu­al­ly get the cre­ative juices of the team flow­ing? Is it a wor­thy North­star? And what I like to say to teams is, is, as we sit here today, if you could look back 10 years and say, I’ve devot­ed 10 years of cre­ative ener­gy, and we all have short careers, like 40 years or some­thing, I’ve cre­at­ed 10 years of my cre­ative ener­gy to this big, hairy, auda­cious goal. Is it worth the effort? And if they’re not vig­or­ous­ly say­ing, yes, then I’d say is that real­ly a good BHAG?

Kevin Lawrence 13:38

Right. And many peo­ple will have they’ll call it a mis­sion, which is, you know, a term Col­in’s used ear­li­er on, but the be hag is a very spe­cif­ic way of look­ing at it is that we’re going to be the lead­ing sup­pli­er of paint prod­ucts to the con­sumers of Cana­da and Unit­ed States, and be great cor­po­rate stew­ards, and take care of the envi­ron­ment. And do this and do this through sus­tain­abil­i­ty. And pur­ple but­ter­flies, and green pup­py dogs, and hap­py days, and a won­der­ful rain­bow. Like peo­ple have these kind of mis­sion state­ments that are in this. It’s just a bunch of cor­po­rate blah, blah, blah. There’s noth­ing in it. That is a sin­gle point of excite­ment that you can dri­ve peo­ple to is just every­thing includ­ing, it’s like peo­ple bring brain­stormed, hey, we’ll be real­ly cool to achieve in the com­pa­ny. They put it up on a big white­board, and then they made it into one para­graph. It does­n’t work. It’s not engag­ing, it needs to be boiled down to sim­ple impact­ful things. And you know, and if you take for exam­ple, the best b hags are con­nect­ed to the com­pa­ny’s pur­pose. So if it was to sell 2 mil­lion pairs of glass­es, maybe you land­ed on that, you got to bring it to life. You know if the com­pa­ny was about the book, the joy of see­ing life vivid­ly. just made that up. ends up, we’re gonna change the life of 2 mil­lion peo­ple. And we’re gonna allow them to more eas­i­ly and afford­ably Enjoy, enjoy the world vivid­ly. And there was a sto­ry and a rea­son behind that. And we were doing a count­down to how many peo­ple were hap­pen­ing to help them every week. And we were donat­ing extra pairs are old pairs to char­i­ty. And now that like, there’s a whole thing around that you can build. But just 2000 glass­es, isn’t that excit­ing there? It needs to mean some­thing. And that’s where ide­al­ly it taps back into the pur­pose. And that’s what the best com­pa­nies do. But then it takes us num­ber five. You got to breathe life into these things con­stant­ly. It becomes wall­pa­per before you know it wall­pa­per mean­ing words that dis­ap­pear, you don’t even see it. And it’s got to be ingrained into the hearts and minds of the entire com­pa­ny. And he got to keep it there and keep it alive. Because it’s like our ral­ly­ing cry. Yeah, it’s like who we are and what we’re about and the dif­fer­ence that we’re mak­ing. And for a lot of com­pa­nies, they some­times start strong, but then it fades real­ly, real­ly quick­ly, just like cul­ture, it fades away and slips into medi­oc­rity before you know it.

Brad Giles 16:40

Oh, it does, it does, we’ve got a tool that we use called actions to live, which is what we need to do in the next 90 days to get more peo­ple to more deeply under­stand core val­ues, core pur­pose, big, hairy, auda­cious goal. And it’s like brush­ing your teeth, it’s some­thing that you always need to do, I want to just touch on an exam­ple of a big, hairy, auda­cious goal. Tes­la, the elec­tric car com­pa­ny, to accel­er­ate the advent of sus­tain­able trans­port by bring­ing com­pelling mass mar­ket elec­tric cars to mar­ket as soon as pos­si­ble. And so for that big, hairy, auda­cious goal, the employ­ees in the lead­er­ship team, the employ­ees in the busi­ness, they can all get behind that. And they all believe in that. And they all must think to them­selves, this is worth devot­ing my cre­ative ener­gies to, and that’s what we want. We want it to be inspir­ing and com­pelling. And not just anoth­er blah, blah goal that’s placed it up on the wall, as you said, turn­ing, you’re turn­ing into wallpaper.

Kevin Lawrence 17:49

Yeah, there’s lots of ways a lot of our client BHAGs don’t want to share them, because that’s very, you know, it’s pri­vate strate­gic tools that they’re using. But there’s a lot of great ones, it takes a bunch of time to get it right. It requires a lot of debate. But if you go through and get your hedge­hog nailed, and then you go and work on your behalf, and then you, you know, sync it back with your pur­pose to make sure it’s in sync with that. It’s incred­i­bly pow­er­ful. And it keeps you focused for the long haul, which is inspired and focus for the long haul, which is what it’s about. So as a ref­er­ence is a great arti­cle from Har­vard Busi­ness Review, Jim Collins, wrote, I think Jer­ry Por­ras was also part of it, it was called Build­ing your com­pa­ny’s vision. It’s a great arti­cle, we rec­om­mend peo­ple use it all the time. And it walks you through pur­pose B hag. And some of those oth­er tools in there are real­ly, real­ly, real­ly is very pow­er­ful. It just it’s both­er­some when it’s mis­used. And it’s not that com­pelling, pow­er­ful tool it can be or it’s also both­er­some when they have a good one. But it fades to wall­pa­per like we’ve talked about. So a ques­tion to leave you with is, is your it? Hope­ful­ly you have one? And if you do is it rel­e­vant? does it align your team? And is it inspir­ing the growth that it should in your com­pa­ny? And when some­times you might need your updat­ed or dust­ed off, which obvi­ous­ly we can help you with if need­ed. Peo­ple that we work with can help you with it. But if you don’t know what it do you think it would make a dif­fer­ence to how your com­pa­ny oper­ate if you don’t think you need it, and that’s your choice. But if you don’t have one, con­sid­er it and go and read that arti­cle and we’ll give you some great ideas to start.

Brad Giles 19:27

Awe­some. So let’s review do a quick review of the five main BHAG mis­takes that we see. Num­ber one, it should fit your hedge­hog. You can’t build a BHAG with any sub­stance unless you’ve nailed your hedge­hog unless you’re con­fi­dent about the hedge­hog. Num­ber two, it should be 10 to 30 years and you’ve said before 10 to 25. But the point is it’s not three and it’s not five years it’s at a min­i­mum 10 years at a max­i­mum 30 years. And then num­ber three is that you must be you must know that you can draw a par­al­lel to the capa­bil­i­ties to exe­cute on that even if it takes a long time, kept you want to walk us through four and five.

Kevin Lawrence 20:13

Yeah, and needs to be inspir­ing, kind of like a North Star South­ern Cross that helps to guide you. And it’s wor­thy of the next decade of you and your team’s cre­ative effort that you’ll feel great about it. And dri­ving towards this needs to be that intrin­sic reward. And final­ly, it needs to be ingrained in the hearts and minds of your peo­ple. You may have an awe­some one that’s fad­ed into the back­ground and needs to be alive and kick­ing in the com­pa­ny. So thanks for lis­ten­ing. This has been the growth whis­per­ers pod­cast with Brad and I’m Kevin if you haven’t sub­scribed, please hit the sub­scribe but­ton and even share it with some of your friends and col­leagues that might find it valu­able. For the video ver­sion youtube​.com Search the growth whis­per­ers to reach Brad evo­lu­tion part​ners​.com​.au and myself, Lawrence and co​.com Hope you have an awe­some week.