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Why Having A BHAG Is Critical To Your Company’s Success

by Josh Cohen, CEO of Junkluggers

A company’s success is driven through goal setting. But not all goal setting is equal.  

On a monthly or quarterly basis, your team can reflect on the year’s objectives and identify the key performance indicators (KPIs) required to hit them. These metrics show the progress you’re making to determine if you are on or off track.

This objective and KPI-focused process can be effective for maintaining and measuring short term progress. But if you’re going to take your company to the next level, you need to think bigger. You need something that will help set a clear intention for what you hope to achieve in the long-term.

What you need is a Big Hairy Audacious Goal, or BHAG. Unlike traditional goal setting, BHAGs make you think outside the box and place your focus on creating passion, motivation, new ideas, and creative outcomes within your company. It pushes everyone’s limits in a healthy way, helping them dream bigger and achieve grander goals.

I’m going to explain what a BHAG is, how I chose mine, and why having one is more critical than ever before.

What’s a BHAG?

BHAGs were established by management guru Jim Collins in his 1994 book Built to Last: Successful Habits of Visionary Companies (Good to Great), co-authored with Stanford professor Jerry Porras. The authors define a BHAG as a long-term goal that is “a powerful way to stimulate progress. [It] is clear and compelling, needing little explanation; people get it right away.”

They also explain that a proper BHAG will have a set time limit, usually between five and 30 years. This is important because the time constraint creates a tone of urgency: what do we need to accomplish right now, tomorrow, and next week to achieve this goal? Team members will be more likely to collaborate and work harder when they share a sense of urgency.

BHAGs also stimulate the creative juices. As employees work together to achieve this grand goal, they’ll come up with innovative solutions and new ideas. More minds working together means more unique vantage points and experiences. When you align these forces, the end result is something remarkable.

Examples of BHAGs.

BHAGs aren’t a trend. They’re embraced by some of the world’s biggest brands. Their BHAGS turned them from average companies to industry rockstars. Here are few examples of BHAGs from companies that are dominating their industries:

Microsoft.

“A computer on every desk and in every home.” Microsoft worked to become a household name in the world of desktop and laptop computers.

Boeing.

“Become the dominant player in commercial aircraft and bring the world into the jet age.” Boeing is now one of the two largest aerospace and defense manufacturers in the world.

Ford.

“Democratize the automobile.” Ford wanted to make the automobile something everyone could enjoy, not just the wealthy or elite.

Walmart.

“Reach $125 billion in sales by 2000.” In 2018, Walmart had $500.3 billion in revenue, with a total revenue of $136.3 billion in the fourth quarter alone.

If BHAGs sound scary, they should! This goal is so large it nearly antagonizes you — it’s a challenge just beyond your reach. Remember that a BHAG shouldn’t be unrealistic, but it shouldn’t be easy either. It’s a bigger, scarier, more audacious goal than you’ve ever chased. Its prime purpose is to drive you and your team forward to do the impossible.

My company was founded in 2004, but we didn’t have a BHAG until 2013. Here’s how we realized this form of goal setting is so important.

Our goal setting journey that lead to a BHAG.

I’m not afraid to take on big challenges — I wouldn’t have launched a company dedicated to picking up and recycling others people’s junk if I was. I had no previous experience in junk removal. While studying abroad in Australia, a friend mentioned he had hauled away an old refrigerator for a hundred bucks. It was one of those “Hey, I can do that!” moments. As soon as I returned stateside, I created some homemade fliers in Microsoft Word and handed them out door-to-door, highlighting my new junk removal service. It wasn’t long before my phone was ringing and demand was up for someone to haul away their old stuff.

These customers weren’t just looking for junk removal. They were looking for a reliable, caring, and eco-friendly company to do it. They also wanted someone who would treat their discarded possessions and fond memories with care. There was sentimental value tied up in this “junk,” and it didn’t deserve to be carelessly tossed away. When I created my company, these were the benchmarks I wanted to meet.

I started with my mom’s SUV, then got a trailer, then graduated to a pickup truck named “Old Rusty,” complete with hand-stenciled lettering by my dad. We started franchising and slowly expanded from Fairfield County in Connecticut over to New York. I realized we were really taking off once we opened operations in the New York City and Long Island markets. I was crushing goals as The Junkluggers grew, but I was deeply worried about losing this momentum. I didn’t know if our values and goals would be shared across team members as the company grew.

I had a base to work from, but I needed a way to drive this company into the future. That’s when I realized a BHAG could help me push my company forward.

How we set our first BHAG.  

Since day one, we were motivated by the greater social purpose of eco-friendly junk removal. It’s always been more than just hauling away junk. While this vision was openly discussed, it wasn’t clearly documented anywhere. We needed a BHAG to get everyone on the same page.

I designed our first BHAG in 2013: keep all junk we pick up out of landfills. Having this clearly defined mission was the guiding principle for key decisions, but it was missing a key element: a deadline.

In 2018, we refined our BHAG to include a due date. By 2025, our BHAG is to ensure no junk picked up by The Junkluggers ends up in a landfill. This mission is shared openly on our website, with potential franchisees, customers, and employees.

From who we hire to planning out which strategic initiatives we’ll invest in, every decision we consider supports making this goal a reality.

In the past, these types of goal setting programs were treated as corporate fluff. But times are changing, and having a BHAG is more critical now than ever. It’s empowering companies to put boots on the ground and work toward a bigger, brighter future. But a BHAG shouldn’t focus solely on revenue or growth. Money is nice, but having an impact on the world is even better. The modern BHAG requires something more: a social purpose.

Why modern BHAGs should be driven by a greater good.

According to a 2018 report by Accenture, 63 percent of consumers prefer to purchase from purpose-driven brands. Factors like price and availability may have been the most important things in the past, but the modern consumer wants to support companies who aim to make the world a better place.

And it’s not just consumers — employees share a similar desire. Instead of working for a paycheck, team members want to feel part of a greater social mission. A 2016 study by Cone Communications found the following:

  • 75 percent of millennials would take a pay cut to work for a socially responsible company.
  • 76 percent of millennials consider a company’s social and environmental commitments before deciding where to work.
  • 64 percent of millennials won’t take a job if a potential employer doesn’t have strong corporate responsibility practices.

Data shows that a company driven by purpose is what customers and employees want.

Tying your company to a greater social good is also something that influences potential franchisees. When franchisees look for a franchisor, they typically weigh the following five factors:

  • Brand image
  • Business model
  • Company goals
  • Unique offerings
  • Current franchisee satisfaction

When a BHAG is tied to a greater social good, you can positively influence all of these considerations. This social purpose will align your brand toward a bigger cause, influence your brand image, and also improve current franchisee’s outlook on the company as a whole. It’s a win-win.

Instead of a goal to crush your competitors or become the Uber of X industry, the modern BHAG should be guided by a desire to have an impact on the world. It’s a powerful way to show that you’re a strong brand with a focus on empathy.

How to know if you have the right BHAG.

You can determine this with a simple test — does your BHAG make you nervous? The more nervous you are, the better. If your deadline is coming up and you’re feeling the pressure, it’s extra validity that your goal is audacious.

Am I nervous about our BHAG? Absolutely — we have to get creative to meet it. The market is currently working against us. There aren’t enough recycling centers to support all of the junk we remove. There are also regulations that make recycling more expensive: after the news that China will no longer be accepting most recyclables, the fees for recycling have increased. It’s more costly for us to continue to be green, but we do it because we believe in it. It’s part of who we are and it’s part of our BHAG. And we’re headstrong when it comes to our BHAG.

I’m not going to let these roadblocks deter us. If I’ve learned anything from Collins, it’s that pursuing our BHAG can help us defy all possibilities regardless of the industry constraints. This nearly impossible goal is in line with our company vision: to enhancing lives, communities, and the environment by donating, recycling, upcycling, and supporting local charities. It’s much more powerful than a shopping list of lukewarm nice-to-have goals.

 

Josh Cohen is the CEO and founder of Junkluggers. He founded Junkluggers out of his mom’s Dodge Durango 14 years ago and has grown the company into one of the largest junk removal franchises in the country. For Josh, it’s about much more than just hauling junk away. He has a greater mission guiding everything they do. Their B.H.A.G. is to ensure no junk collected by Junkluggers enters a landfill by 2025.

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