Starting a business usually begins with a dream. More freedom, more autonomy, better work-life balance, or turning a skill or passion into a business of your own.
Whatever the reason, most small businesses start from a passion and a desire for a different future. But, unfortunately, it’s easy to lose sight of that big dream when you’re buried under all the day-to-day comings and goings of business life.
Invoices need chasing, emails need answering, social media needs updating, meetings need attending, and all the client work needs to be done somewhere in there too.
Suddenly, instead of thinking about the future of your business, you’re spending all your energy making sure you get through to Friday.
That’s where a Big Hairy Audacious Goal, or BHAG, can help.
And with it being World Dream Day, it’s a good opportunity to stop and ask: What is the big dream behind your business?
And perhaps more importantly: What would happen if you were brave enough to turn that dream into a really big goal?
What on Earth is a Big Hairy Audacious Goal?
A Big Hairy Audacious Goal, or BHAG, does sound a bit gross. But it can be really great for your business.
It comes from the book Build to Last by Jim Collins and Jerry Porras. They describe a BHAG as a clear, compelling, and ambitious goal that acts as a focal point for effort and has a clear finish line. It’s similar to your SMART Goals, but so much bigger. The bigger and more ambitious, the better.
In other words, it’s not: “I’d like to get 20 new clients by the end of 2026.” Sure, it’s a perfectly reasonable ambition, but it isn’t particularly hairy or audacious.
Instead, it could be:
“By 2035, we will become the most trusted independent XYZ company in our area.”
Or:
“We will become the go-to provider of our product or service across New Zealand.”
A BHAG should feel exciting and maybe a bit scary. It should be the stretch goal of all stretch goals. It gives you something to work towards continuously.
Why Should a Small Business Have a BHAG?
You might be thinking:
“I’m a sole trader. Do I really need a big corporate goal?”
Absolutely! It’s not just for organisations with hundreds of employees working in a high-rise office overlooking Wellington Harbour.
A big goal like a BHAG is especially important for small businesses because it’s so easy to get bogged down with the day-to-day, even though you also need to be focused on the future of the business.
When you’re responsible for almost everything, today’s priorities tend to win. The urgent customer email beats the long-term strategy. The invoices that need to be sent win out over the long-term strategy.
Working on the latest urgent problem almost always beats working on the bigger picture.
It gives you something to look up at when you’re taking a breath from the work.
Its whole purpose is to remind you of why you’re doing it all in the first place.
It Gives Your Business Direction
The great thing about a goal is that it provides a destination. Instead of asking yourself what you need to do for the day, you can ask whether what you’re doing gets you closer to where you want to be.
You’d be surprised how much of a difference that change makes. Instead of focusing on the individual tasks you can focus on the things that bring you closer to the end point. It can make your decision-making much easier.
If your BHAG is to build a business that can operate without you, then working on your recruitment and SOPs becomes much easier.
If it’s to be the best in your industry in your region, then investing in professional development, building your reputation, and getting more visible becomes more important.
Your goal helps determine the path that you take towards success.
You Can Make Decisions Easier
Your BHAG can become like a filter for your decision-making. When you’re looking to make a change in your business, or someone suggests something new, it gives you a checkpoint to run it through before deciding.
If you take the time to ask, “Does this move us towards our goal?” you can make your decision much easier.
If the answer is yes, then you can investigate it further. If it’s a no, then perhaps it’s a distraction.
This can be extra helpful for small businesses because there’s always another opportunity demanding your attention. And some of those opportunities can be quite expensive. So making sure that the opportunity is a step in the right direction makes the decision easier.
It helps you decide which opportunities are the ones worth chasing.
It Helps Manage People and Culture
Your BHAG can help you attract the right people and foster a motivational culture within your business. It can help to influence who you work with and who you accept help from.
Finding someone to work with that understands your BHAG and helps you work towards it is key to your success.
This is for employees and contractors as much as it is for clients.
It also makes having difficult conversations with your team a bit smoother. If there’s a collective goal for the company, identifying when things are going wrong and talking about it is easier.
You can use it to have more collaborative conversations rather than accusatory ones. Instead of “You’re doing this wrong”, it can be “This doesn’t help us get to our goal; how can we find a way to get back on track?”
As for clients, your BHAG can help you identify which ones are your ideal clients. Which ones will help you move forward towards your goals. And it makes saying no to, or firing, the ones that don’t easier.
The collective goal helps you work with the right people.
How Do You Create a BHAG?
Creating a BHAG doesn’t need a whole room full of strategic business consultants. It’s a 6-step process that you can do by yourself or with your team.
Step 1: Start with the original dream
Before you worry about the numbers or anything, you need to take a step back in time to when you first started your business. Think about the reason behind it.
Think about all your original aspirations. Ask yourself these questions:
- Why did you start?
- What are your mission, vision, and values?
- What did you want your life to look like?
- What problem did you want to solve?
- What did you hope the business could become?
It should connect to something that matters to you.
If your dream is freedom or work-life balance, a BHAG focused on becoming a bigger business might not excite you. However, if your dream is to create jobs in your community or help as many clients as possible, becoming a larger employer could be a great goal.
It’s ok if you started your business without all of these aspirations. But think back to a time when you realised this business was something serious that could go somewhere.
Step 2: Look to the future possibilities
Once you’ve gone back, you need to go forward. Forget what’s going on currently.
Imagine that it’s 5, 10, 15, or even more years from now and your business has succeeded beyond your wildest hopes and dreams. And ask yourself:
- What does it look like?
- How big is it?
- Who works there?
- Who are your customers?
- Where are you operating?
- What are people saying about the business?
- What does your role look like?
- What does your life look like?
The trick is to let your imagination go wild. Let go of all your preconceived ideas about where it could go. Don’t let yourself start worrying about whether it’ll work or not. This is where your dream lives, not the limitations.
Step 3: Condense the dream
Once you’ve gone back to see where you’ve come from and looked forward to see where you could go, it’s time to start creating your Big Hairy Audacious Goal.
The first step is to figure out what the Big Goal is. Don’t worry, the Hairy Audacious part comes next.
Here you have to answer the question “What does success look like in the future?”
Take everything that you’ve brainstormed in Step 2 and find the bits that excite you. Try to condense it down into something that makes sense and excites you. It can be bullet points, a long run-on sentence, or a mind map. As long as it makes sense to you.
Write it down. Because now you have something to work with. It should be a goal that answers what success looks like and combines your original dream with your vision for the future.
NOTE: Your BHAG doesn’t have to be about being the biggest. It’s whatever feels most authentic to where you see yourself in the future. Rather than being about becoming a huge company, it’s about creating something you can hand over to your children or about having a better work-life balance.
Big means meaningful and ambitious to you.
Step 4: Make It Audacious
This is where you make your big goal Hairy and Audacious. Because it shouldn’t feel safe. It shouldn’t even feel 100% achievable. In fact, if you know how you’re going to achieve it, you’ve set yourself a normal goal and should start again.
Jim Collins describes an effective BHAG as one that sits in a space where the goal is highly ambitious but still achievable. You might not know HOW to achieve it, but you must believe that some way, somehow, you can achieve it.
It should stretch your thinking, require you to grow, and make you a bit uncomfortable.
If you’re not there yet, you can start by playing with numbers. If a goal to have 10 employees feels totally doable, double it, triple it, quadruple it. Increase your numbers until it starts to feel a bit ridiculous.
Once it starts to feel out of reach, you’ll know you’ve got the balance right. It should feel exciting, uncomfortable, and it should make you ask yourself, “How on earth am I going to do this?”
Step 5: Give It a Finish Line
Once you’ve got your goal big enough, hairy enough, and audacious enough, it’s time to give it a timeframe. Because a goal without a timeframe remains a nice idea forever.
This isn’t your usual by Q3, by end of year, by EOFY, kind of timeframe.
The timeframe also needs to adhere to the bigness, hairiness, and audaciousness of it all.
Think long term: 10, 20, even 30 years or beyond.
The reasoning behind this is to pull you out of thinking short-term about your business. It gives you a direction to take the company in, instead of getting sidetracked with things that don’t align with where you want to go. It gives you something to focus on and align your business with over a longer period, instead of just working year-to-year.
The finish line gives you accountability to achieve your dreams and the focus to make continuous movement towards it.
Step 6: Review
Before you set it in stone, take some time to review your proposed BHAG. It’s important to make sure that it is something that you actually want to work towards.
There is a chance that, when you started this project, you had something going on that has influenced your decision-making.
So, feel free to put it aside for a while, checking in regularly, to make sure that it is something that feels aligned outside of the moment you sat down to write it.
The last thing you want is to have done all this work only to decide that it’s not actually authentically you at a later date.
So, I’ve Made My BHAG, Now What?
Once you’ve made your Big Hairy Audacious Goal, it’s hard to know what to do with it. The temptation is to fold it up and pop it in a drawer, never to be seen again. No judgment, we’ve all been that person before.
There’s no point spending all this time and effort on a creating one, only to put it aside and forget about it. It needs to be top of mind to influence what you actually do. There are many ways it can do this, including:
Breaking it down into smaller goals
Think of your BHAG as a mountain. You can’t climb to the top in one giant step. You need to work towards the summit slowly and surely.
You need the smaller milestones along the way to make sure that you get to your destination.
Break it down into smaller goals. Something you ‘d like to have achieved in 5 years, a smaller goal to achieve in 3 years. Then you get to your yearly goals, 6-month goals, and your 90-day sprints.
Now the goal that seems massive starts to become practical and more achievable.
Reviewing Regularly – Don’t Be Afraid to Change the Route
Your BHAG gives you the destination, but there are many ways to get there. And it’s ok to let your path change as it needs to.
As you, your business, the market, and your customers change, you might find the need to tweak the road that you’re on.
The thing you thought you wanted five years ago might no longer be what you want five years from now.
It should be there to stimulate progress and give you something to work towards. It shouldn’t be a prison of your own making.
You can change the strategy, the milestones, the path you take to get there. You can even change the destination if you really want to.
Your Dream is What Got You Started. Your BHAG Can Keep You Moving.
Starting a business takes a dream, a goal, and the guts to do it. You have to believe in an idea, put yourself out there, learn all of the business things, and you have to persevere through all the inevitable ups and downs.
That’s why World Dream Day is a great reminder for business owners.
Before the invoices, the spreadsheets, the marketing plans, and the endless to-do lists, there was a dream. One of freedom, of independence, of building something of your own.
Take the time this World Dream Day to revisit that dream. Then make it bigger and turn it into something tangible. Write it down, give it a date, and work backwards until you have somewhat of a plan.
You don’t need to know exactly how you’re going to climb the mountain. But you do need to know which mountain you’re climbing.
