Identifying core ideology is a discovery process, but setting the envisioned future is a creative process. We find that executives often have a great deal of difficulty coming up with an exciting BHAG. They want to analyze their way into the fu- ture. We have found, therefore, that some execu- tives make more progress by starting first with the vivid description and backing from there into the
envisioned future should be so exciting in its own right that it would continue to keep the organiza- tion motivated even if the leaders who set the goal disappeared. City Bank, the predecessor of Citicorp, had the BHAG “to become the most powerful, the most serviceable, the most far-reaching world fi- nancial institution that has ever been” – a goal that generated excitement through multiple genera-
tions until it was achieved. Similar- ly, the NASA moon mission contin- ued to galvanize people even though President John F. Kennedy (the leader associated with setting the goal) died years before its completion. To create an effective envisioned future requires a certain level of un- reasonable confidence and commit- ment. Keep in mind that a BHAG is not just a goal; it is a Big, Hairy, Au-
What’s needed is such a big commitment that when people see what the goal will take, there’s an almost audible gulp.
dacious Goal. It’s not reasonable for a small region- al bank to set the goal of becoming “the most pow- erful, the most serviceable, the most far-reaching world financial institution that has ever been,” as City Bank did in 1915. It’s not a tepid claim that “we will democratize the automobile,” as Henry Ford said. It was almost laughable for Philip Morris – as the sixth-place player with 9% market share in the 1950s – to take on the goal of defeating Goliath RJ Reynolds Tobacco Company and becom- ing number one. It was hardly modest for Sony, as a small, cash-strapped venture, to proclaim the goal of changing the poor-quality image of Japanese products around the world. (See the insert “Putting It All Together: Sony in the 1950s.”) Of course, it’s not only the audacity of the goal but also the level of commitment to the goal that counts. Boeing didn’t just envision a future dominated by its com- mercial jets; it bet the company on the 707 and, later, on the 747. Nike’s people didn’t just talk about the idea of crushing Adidas; they went on a crusade to fulfill the dream. Indeed, the envisioned future should produce a bit of the “gulp factor”: when it dawns on people what it will take to achieve the goal, there should be an almost audible gulp. But what about failure to realize the envisioned future? In our research, we found that the visionary companies displayed a remarkable ability to achieve even their most audacious goals. Ford did democ- ratize the automobile; Citicorp did become the most far-reaching bank in the world; Philip Morris did rise from sixth to first and beat RJ Reynolds worldwide; Boeing did become the dominant com- mercial aircraft company; and it looks like Wal- Mart will achieve its $125 billion goal, even with- out Sam Walton. In contrast, the comparison com-
BHAG. This approach involves starting with ques- tions such as, We’re sitting here in 20 years; what would we love to see? What should this company look like? What should it feel like to employees? What should it have achieved? If someone writes an article for a major business magazine about this company in 20 years, what will it say? One biotech- nology company we worked with had trouble envi- sioning its future. Said one member of the execu- tive team, “Every time we come up with something for the entire company, it is just too generic to be exciting – something banal like ‘advance biotech- nology worldwide.’” Asked to paint a picture of the company in 20 years, the executives mentioned such things as “on the cover of Business Week as a model success story…the Fortune most admired top-ten list…the best science and business gradu- ates want to work here…people on airplanes rave about one of our products to seatmates…20 consec- utive years of profitable growth…an entrepreneuri- al culture that has spawned half a dozen new divi- sions fromwithin…management gurus use us as an example of excellent management and progressive thinking,” and so on. From this, they were able to set the goal of becoming as well respected as Merck or as Johnson & Johnson in biotechnology. It makes no sense to analyze whether an envi- sioned future is the right one. With a creation – and the task is creation of a future, not prediction–there can be no right answer. Did Beethoven create the right Ninth Symphony? Did Shakespeare create the right Hamlet ? We can’t answer these questions; they’re nonsense. The envisioned future involves such essential questions as Does it get our juices flowing? Do we find it stimulating? Does it spur forward momentum? Does it get people going? The
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HARVARD BUSINESS REVIEW September-October 1996
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