A Big Hairy Audacious Goal (BHAG) forces a company or an organization to think big and create a plan for long-term success. It sets a huge goal that drives progress forward, defines a vision for the future, and gets everyone working toward achieving it.

What is a BHAG?

A BHAG is a huge, long-term target or goal that energizes an organization and focuses its people, rallying them to a common cause and leading them through a process of transformation.

The term was originally coined by Jim Collins and Jerry Porras in their book Built to Last: Successful Habits of Visionary Companies, first published in 1994. Collins says, “The power of the BHAG is that it gets you out of thinking too small. A great BHAG changes the time frame and simultaneously creates a sense of urgency. ”

A true BHAG requires a long-term commitment and cannot be achieved in three or five years. Plan on a minimum of ten years to accomplish a BHAG, possibly even two or three decades. Make sure your  BHAG is doable, however—not a long shot or pipedream. It should, at a minimum, have a 50% chance of being achieved.

But because it is so big, hairy, and audacious, it can really energize everyone in an organization. “You look at it and say, ‘Oh my goodness, if we’re going to bring the world into the jet age or transform education or put a computer on every desk, then we have to get to work today with a level of intensity that is unrelenting,’” adds Collins.

An example of a BHAG is President Kennedy’s 1961 declaration: “This nation should commit itself to achieve the goal, before this decade is out, of landing a man on the moon and returning him safely.” Of course, this national commitment resulted in the historic moon landing in 1969.

Other prominent BHAGs include:

• Google: “Organize the world’s information.”
• Tesla: “To accelerate the world’s transition to sustainable energy.”
• Microsoft: “A computer on every desk and in every home.”

There are four broad categories of BHAG:

• Role model—Here, you would emulate the traits of another well-known and highly successful company. For example, you might aim to become the Uber or Nike of your industry.
• Common enemy—This is the intention to overcome the top companies in your industry to become the leader yourself.
• Targeting—This type of BHAG is about setting a clearly defined quantitative or qualitative goal, such as becoming a billion-dollar company or No. 1 in an industry.
• Internal transformation—This category is usually best for a large, established company seeking to overhaul systems, processes, or positioning. What makes a good BHAG?

A great BHAG is as the name suggests:

• (B)ig—It’s so big that it's not something that your organization can accomplish in a year, three years, or five. It takes a minimum of ten years to accomplish something this ambitious.
• (H)airy—The idea seems wild and crazy because it’s so forward-looking and so out of the box. It’s something you’ve never done before.
• (A)udacious—It should have a gasp factor that makes you sit up and listen when you first think about or hear it. The next emotion should be that it’s exactly the right idea for your company to pour its heart and soul into.