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What Is a BHAG, and Why Do You Need One?

A BHAG is an idea from Built to Last, Jim Collins' classic business book. It means Big, Hairy, Audacious Goal—a goal that's just a little bit too far out of reach. It's one of the concepts Collins found that distinguishes great companies from average ones.

BHAGs Make A Difference

So what good is a goal you don't think you can reach? Here are two reasons a BHAG is good for you and your company:

  1. A BHAG is a challenge. You want a goal that's just out of reach. Even when you stretch or jump a little, it's just beyond your fingertips. A BHAG isn't a goal that's too far to ever reach—that would make you feel defeated. A BHAG inspires you to work harder and more creatively to make sure you reach that goal. There's no good reason not to reach it. It's right there!
  2. Even if you don't reach it, your BHAG will do amazing things. A BHAG is made to push you, to get you to try harder than you have to reach a "normal" goal. So even if you don't reach it, you're still going somewhere—places you might never have thought of before.

BHAG Breakdown

Take Dave's goals, for instance. In 1993, Dave had written his first self-published book, Financial Peace, his radio show was on one tiny, local station, and he was doing one-on-one financial counseling. He had a vision to expand into local and national media outlets and develop a combination seminar and counseling program, the beginnings of Financial Peace University (FPU). He came up with some two-year BHAGs for his business. Here's how they compared to the reality:

  Goal Reality
1995 -Radio show in 25 cities
-Sell 50,000 copies of Financial Peace
-Teach FPU in five cities
-Radio show in 1 city
-Sold 14,000 copies of Financial Peace
-FPU taught in two cities

1996

-Radio show in 75 cities
-Sell 200,000 copies of Financial Peace
-Teach FPU in 25 cities
-Radio show in 12 cities
-Sold 100,000 copies of Financial Peace
-FPU taught in three cities


Dave clearly missed his goals, but those goals propelled him in a direction he might never have considered if he hadn't written them down and taken the steps to achieve them. Now Dave's radio show is on in 480 cities, he's sold two million Financial Peace books, and more than one million families have taken FPU in churches, workplaces, community centers and military installations all over the country—even around the world!

The Lesson of the BHAG

As you think about your own BHAGs, remember that success isn't reaching a goal. Success is the progressive realization of a worthy goal or ideal. Whether you reach your BHAG right away, or if it takes you a little longer than you expected, like Dave, the pursuit of your goal—the steps you take toward it—are success.

Does your business have the right insurance? Connect with a local pro to learn more.

No leader should lead without these principles. It’s what your team members need to see in you, and what you want to see in them. Learn more about the EntreLeadership Live Events, and put Dave's 20 years of proven business principles to work for you.

Ramsey Solutions

About the author

Ramsey Solutions

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners.

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