Business musings

Articles and thoughts about vision

At a recent event held by Warwick Business School, Professor Mark Taylor, Dean of WBS, described an effective vision as needing to be:

Out of reach but not out of sight

In other words, you should be able to visualise your organisation achieving its vision but it should not be possible for your organisation to reach out and take hold of the vision straight away. True vision is a balance between these two ideas.

If you cannot picture or imagine your organisation achieving its vision, no matter how hard you try, it is likely that this ‘out of sight’ vision is either the wrong vision for your organisation—one that does not fit with your organisation’s passions, purpose, values and beliefs—or it is so over-ambitious as to be unachievable. Vision of this kind will help no one. It may lead you in entirely the wrong direction and it is unlikely to ever be achieved. It certainly will not benefit your organisation over the long-term.

On the other hand, a vision that is within reach and can easily be grasped tomorrow, within the next month, the next year, or even the next five years, is not really a vision. Vision should be a future-oriented goal that is exciting, inspiring, motivating and more than a little stretching. It should challenge you to achieve more and to push your organisation beyond its comfort zone. Without this kind of vision, you are merely dealing with the day-to-day, month-to-month and year-to-year—reacting to your future, rather than creating it.

Warwick Business School certainly stand by the Dean’s assertion. Their vision is:

To be the leading university-based business school in Europe

And they describe their mission as:

  • To produce and disseminate world-class, cutting edge research that is capable of shaping the way organisations operate and businesses are led and managed.
  • To produce world-class, socially responsible, creative leaders and managers who think on a global scale, regardless of the size of their organisation.
  • To provide a return on investment for our students and alumni over their entire careers.

Hopefully they also have a vivid description of what it will look like for them to achieve their vision and measures of success that will enable them to know when they have become the leading university-based business school in Europe.

Out of reach but not out of sight is also a perfect description for an element of vision that Jim Collins and Jerry Porras coined BHAGs—”pronounced BEE-hags and shorthand for Big, Hairy, Audacious Goals.” Warwick Business School’s vision is certainly a big, hairy, audacious goal!

Four approaches to creating a BHAG

For those of you who read my earlier article that introduced the vision framework created by Collins and Porras, you will already be familiar with BHAGs. Something I chose to leave out of this article however was the fact that Collins and Porras also believe that there are four “approaches” or “broad categories” into which all BHAGs fall: target, common enemy, role model and internal transformation. As we shall see, Warwick Business School have chosen a target BHAG.

Targeting

Much as the word ‘target’ implies, a target BHAG involves “setting a clear, definable target and aiming for it,” in the same way as an archer or marksman would aim to hit their chosen target.

For Collins and Porras, a target BHAG can be either qualitative (such as Ford Motor Company’s vision to “democratize the automobile” in the early 1900s and the 1960s NASA moon mission) or quantitative (such as Walmart’s vision in 1990 to “become a $125 billion company by the year 2000—which, incidentally, it achieved and exceeded!)

Typically, quantitative targets are likely to be financial or may involve an increase in physical size. Qualitative targets, on the other hand, are typically “defined in terms of taking the company to an entirely new level of overall prestige, success, dominance, or industry position.” Warwick Business School’s BHAG would fall into this category. Whilst their undergraduate programme has already been ranked #1 in the UK in 2010, their vision is to become the leading university-based business school not only in the UK but also in Europe, and to lead in quality for their research, graduates and programmes—a new level of prestige, success, position and potentially dominance, all in one!

Common enemy

Common enemy BHAGs involve David versus Goliath motivation and “a goal focused on defeating a common enemy.” Collins and Porras cite the examples of Nike’s 1960s mission to “Crush Adidas” and Honda’s 1970s response of “Yamaha wo tsubusu! (We will crush, squash, slaughter Yamaha!)”. When interviewed by Collins and Porras in 1990, an anonymous board member of Nike even remarked: “Our idea of a perfect day is to get up in the morning and throw rocks at our competitors.”

Typically, common enemy BHAGs are set by companies striving to become number one and, as evidenced by the comments above, they tap into the motivation to fight and to win. Common enemy BHAGs can therefore also be useful if your organisation is struggling against the force of its competitors: “they can transform an organization whose back is against the wall and that is concerned about its very survival.” And, as “people don’t like to ‘just survive’, they like to win,” common enemy BHAGs can take your organisation beyond surviving to overcoming and to even coming out on top.

However, as Collins and Porras observe, common enemy BHAGs can have their drawbacks: “…it is difficult to spend your entire life ‘at war.’ And what do you do when you’ve defeated the enemy and become number one? What happens when you are no longer David, and have become Goliath?” Beware the “we’ve arrived syndrome” and ensure that you create another BHAG as soon as you’ve achieved your last!

Role model

Role model BHAGs do what they say on the tin: they involve selecting a role model (usually another business, organisation or person) and seeking to emulate their traits and success. Although less common than target or common enemy BHAGs, Collins and Porras believe that role model BHAGs suit up-and-coming organisations and they found that they were “usually set by promising small to mid-sized companies with bright prospects in their industries.”

Examples of role model BHAGs include that of Giro Sport Design, which as a young company in the early 1990s sought to “be to the cyclying industry what Nike is to athletic shoes and Apple is to computers.” In the 1940s, Stanford University similarly desired to “become the Harvard of the West.”

Collins and Porras are quick to point out however that role model BHAGs are only effective to the degree that the role model you select “generates powerful images for [your] company members. Sometimes, the images generated may be so complex that they do not mean the same thing to all members and, as such, don’t provide the integrative force required of an effective mission.” To this end, be sure to select an identifiable and easily understood role model for this type of BHAG.

Internal transformation

Last but not least, internal transformation BHAGs differ somewhat from common enemy, role model and, to a degree, target BHAGs, in that they are focused internally rather than externally. Internal transformation BHAGs seek to transform your company from within. Such transformation could, in turn, lead to increased sales and external success but it is not the focus.

For this reason, Collins and Porras suggest that internal transformation BHAGs are suited to “large, established organizations” or “old organizations that need to dramatically change themselves in order to remain competitive and healthy (or, sometimes, to regain their health).” They cite the example of General Electric which, in 1986 and to cope with the inefficiencies of its size, stated that: “In addition to the strength, resources and reach of a big company, which we have already built, we are committed to developing the sensitivity, the leanness, the simplicity and the agility of a small company. We want the best of both…[a] big-company/small-company hybrid.” If your organisation could benefit from radical revitalisation, an internal transformation BHAG may be for you.

What’s your big, hairy, audacious goal?

We’ve already seen that…

  • Warwick Business School want to become the leading university-based business school in Europe.
  • Walmart exceeded their goal for the year 2000 and just keep growing—in their last fiscal year, they reported net sales of $443.9 billion, an increase of 5.9% over the previous year.
  • NASA achieved their vision of “landing a man on the moon and returning him safely to earth.”
  • The year after they established their vision, Honda “so thoroughly defeated Yamaha that Yamaha later publicly apologized to Honda for having claimed that it would dominate Honda.”
  • Giro Sport Design (now known as Giro) have grown from creating the first ventilated, lightweight cycling helmet in 1985 to now being a world leader in equipment for cycling, skiing and snowboarding with goods that “are worn by millions of riders around the world” and showcased at events such as the Tour de France.
  • And time will tell for General Electric. Having taken a thorough beating in the financial crisis as General Electric’s financial services division plunged the company into the red, we will now find out whether the giant really does have the agility of a small company as it seeks to return to what it knows best (making stuff) and turning its fortunes around.

So, following that inspiration, what is your big, hairy, audacious goal for the future of your organisation?

Although many of the examples above involve corporate giants, BHAGs are in fact for everyone. In its early days, Giro was a single product start-up in which the founder, Jim Gentes, “stocked inventory in his bedroom, used his garage as a manufacturing plant, and expanded by trading a helmet with his neighbour for use of his garage.” From such humble beginnings has come great success!

And even if world domination is not your thing, BHAGs can be a powerful motivator for the goals that you do wish to achieve. Collins and Porras even note that there is a special case for BHAGs in start-up companies in which it is more than enough to set the big, hairy, audacious goal of “reach[ing] a point where survival is no longer in question.”

Whether you need to take on your competitors, emulate an organisation that you admire, strive for an out of reach target or transform your company from within, BHAGs can be incredibly powerful motivators. Their success does not even have to be measured by whether or not you achieve the BHAG itself because you will accomplish so much more along the way.

One of my favourite quotes comes from Louise Keeney, Director of Bondeye Optical, who when we were working with them described this perspective on vision as, “Aim for the stars and clear the fence.” Setting a BHAG is very definitely aiming for the stars but, whether you reach the stars or not, you will certainly clear a fence or three along the way—fences that you may not otherwise have cleared had you not created a vision in the first place.

And, as the examples above show and research has continually supported, those companies who set themselves big, hairy, audacious, out of reach but not out of sight goals do in fact achieve them on a surprisingly consistent basis.

So, what are you waiting for? Set a big, hairy, audacious goal today and find out what your organisation really could achieve in the next 10 to 30 years!

And for those of you who like the research…

Collins, J.C. & Porras, J.I. (1991). Organizational vision and visionary organizations. California Management Review. 30-52.

Collins, J.C. & Porras, J.I. (1996). Building your company’s vision. Harvard Business Review

For anyone familiar with vision, values and purpose, chances are that you’ve heard of Jim Collins and Jerry Porras.

Two square photographs: on the left is a headshot of Jim Collins (wearing a navy suit, blue shirt and red tie); on the right is a headshot of Jerry Porras (wearing a black suit, white shirt, blue tie and glasses)

Built to Last (written by both Collins and Porras) and Good to Great (written by Collins) have been described by The Economist as “the Harry Potters of management literature”. Built to Last was a fixture on the BusinessWeek best seller list for more than six years and Good to Great (which has been translated into 35 languages) was, in 2008, the bestselling business book of all time.

For this reason, Collins and Porras cannot be ignored and they have been credited with being “largely responsible for a revival of interest in the ‘visioning thing’ in the mid-1990s”.

That is not to say however that the pair are without their critics, in part due to the fact that “almost half of the visionary companies on [their] list have slipped dramatically in performance and reputation.”

In an in-depth article published in 2004, Fast Company examined both sides of the argument—namely, have the companies on Collins and Porras’ list failed because they stopped applying their principles or did other events and the wider business context simply change?—and essentially ended up sitting on the fence:

There’s this one big rub about management books…The world they seek to describe is so complex, so tumultuous, often so random as to defy predictability and even rationality…And all this jumble and chaos mean…that for every management theory, there is an equal and opposite theory that makes just as much sense…Perhaps BTL readers would do well to follow the title of chapter seven: Try a Lot of Stuff and Keep What Works. Now there’s some business advice worth taking.

Personally, I love Collins and Porras’ work and believe that we can learn a great deal from their insights. Yes, critical thinking must be applied to every text and it’s important to learn from later events but that’s not to say that works authored by Collins and Porras are lacking in value.

Matt and I have put their approach to building vision to the test (both ourselves and with our clients) and we believe it works. I agree that no theory or book should ever be taken as gospel but, in our experience, Collins and Porras’ philosophy is a great place to begin the journey of articulating vision, values and purpose. At the very least, it provokes lively discussions within management teams and their organisations, stimulates the discovery of valuable insights and provides food for thought. All of these are worthy outcomes and if such experiences lead to strategic alignment, a unified focus and motivated people, then I believe their philosophy offers much that we can learn from.

A little history…

Collins and Porras’ first attempts to create a framework that defined organisational vision seem to be documented in their 1991 research paper, Organisational Vision and Visionary Organizations. This framework consisted of a ‘Guiding Philosophy’ (in which purpose was driven by core beliefs and values) and a ‘Tangible Image’ (in which mission led to the creation of a vivid description).

Their framework was influenced by both the research later published in Built to Last and their work with a variety of organisations. It should also be said that, in creating a framework, Collins and Porras intended to remove some of the “fuzziness” surrounding vision:

If we look at the literature on organizations and strategy, we find numerous terms for “vision” that sometimes are used synonomously, sometimes have partially overlapping meanings, and sometimes are intended to be totally distinct from each other. As one CEO told us: “I’ve come to believe that we need a vision to guide us, but I can’t seem to get my hands on what ‘vision’ is…no-one has given me a satisfactory way of looking at vision that will help me to sort out this morass of words and set a coherent vision for my company. It’s really frustrating!”

Eventually, the ideas first articulated here evolved into the framework many will now be familiar with from Built to Last and also Building Your Company’s Vision published by Harvard Business Review in 1996:

The diagram shows a modified yin yang symbol. In the yin element of the circle are the words, "Core Ideology: Core values, Core purpose" and in the yang element of the circle are the words, "Envisioned Future: 10-to-30-year BHAG (Big, Hairy, Audacious Goal), Vivid description".

For those of you unfamiliar with this framework, I hope to provide an introduction below.

Core ideology

For Collins and Porras, core ideology is absolutely integral to vision setting. Their use of the yin yang symbol was deliberate: core ideology is essentially meaningless without progress or movement towards the future, whilst a congruent vision cannot be created without a stable foundation.

For a vision to be created, it is essential to first understand those elements of the organisation that will always remain unchanging. In the words of Collins and Porras themselves:

Core ideology defines a company’s timeless character. It’s the glue that holds the enterprise together even when everything else is up for grabs…a consistent identity that transcends product or market life cycles, technological breakthroughs, management fads, and individual leaders.

Core values

Core values are the handful of beliefs, guiding principles or tenets that are absolutely non-negotiable within an organisation. Imagine your own personal values: it may be that, in relationships, honesty, integrity and kindness are important to you; you may value courage, fearlessness and daring; or how about fun, humour and happiness?  When you contemplate your personal values, you usually have a sense of what is truly important to you—the characteristics that you couldn’t live without. For Collins and Porras, organisational core values are the same—they are as natural as breathing.

Throughout their research, Collins and Porras consistently found that “companies tend to have only a few core values, usually between three and five”—any more than this and they believe that core values are being confused with other factors. From their perspective, ‘core’ means that a value is “so fundamental and deeply held that [it] will change seldom, if ever.”

Consistent with this idea, they believe that values cannot be created but must instead be discovered. Although we all aspire to worthy ideologies, if a value is not authentic to the behaviour of your organisation, Collins and Porras suggest that treating it as core is likely to lead to justifiable cynacism. Instead, they believe that aspirations are more appropriate to an envisioned future.

So, what does your organisation really believe in? There is “no universally right set of core values” and it is even likely that other organisations will hold at least some of the same core values as you. It is important however to determine those values that your organisation would hold steadfastly. To test whether a value is truly core, Collins suggests asking whether you would want your organisation to stand for this value in 100 years time and he even goes so far as to ask whether you would continue to hold this core value “even if at some point in time it became a competitive disadvantage”?

Core purpose

In many ways, core purpose is similar to core values: it is natural and fundamental to an organisation, it is deeply held and unchanging, it need not be unique, and it must be discovered rather than created.

For Collins and Porras, every organisation has a purpose, even if it hasn’t been articulated yet. Purpose could be described as the heartbeat or soul of your organisation—your organisation’s “most fundamental reason for being”. Not to be confused with product lines, services or customers, purpose motivates and inspires. A true purpose grabs “the ‘soul’ of each organisational member” and reflects their “idealistic motivations for doing the work.”

For me, Collins and Porras’ best description of core purpose is:

…like a guiding star on the horizon—forever pursued but never reached.

Purpose guides and directs an organisation, it determines who fits within an organisation and who does not, it is the plumb line by which all other decisions should be measured.

To determine your core purpose, Collins and Porras suggest asking questions such as:

How could we frame the purpose of this organisation so that if you woke up tomorrow morning with enough money in the bank to retire, you would nevertheless keep working here?

When telling your children and/or other loved ones what you do for a living, would you feel proud in describing your work in terms of this purpose?

Envisioned future

For Collins and Porras, an envisioned future is the means through which core ideology is translated into a tangible goal that stretches and challenges your organisation. Where core ideology “resides in the background, ever-present and ‘in the woodwork’”, an envisioned future is “in the foreground, focusing people’s attention on a specific goal…[it] is bold, exciting and emotionally charged.”

10-to-30 year BHAG (Big, Hairy, Audacious Goal)

Whilst all companies have goals, Collins and Porras found that visionary companies often had exceptionally bold and ambitious targets or, as Collins and Porras coined them, BHAGs—”pronounced BEE-hags and shorthand for Big, Hairy, Audacious Goals”.

Unlike core purpose, a BHAG has a clear finish line and an organisation should be able to determine when the goal has been achieved. That said, for Collins and Porras, “a BHAG should not be a sure bet—it will have perhaps only a 50% to 70% probability of success”. However, an organisation should nonetheless believe that it can achieve the goal, something that Collins and Porras came to call the “hubris factor”. To set BHAGs requires a “certain level of unreasonable self-confidence” or, at the very least, unreasonable self-ambition.

The easiest way to explain BHAGs is to compare them to stretching and challenging personal goals. For example, I have reasonably good levels of fitness and enjoy exercising regularly but to set myself the goal of cycling from Land’s End to John o’Groats, completing an Ironman triathlon, or climbing Mount Everest would require extraordinary effort on my part. All of these goals are potentially within my reach should I ever wish to complete them but they are certainly no walk in the park! BHAGs are the 10-to-30 year organisational equivalent of these. What does your organisation wish to achieve in its future that would require “extraordinary effort and perhaps a little luck”?

Perhaps the other thing that should be said about BHAGs is that, much like core ideology, they should be inspiring. To be honest, I have no real wish to climb Mount Everest at present, so I am unlikely to ever achieve it. Setting a BHAG simply for the sake of setting a goal is pointless. Rather, Collins and Porras suggest you should ask, “Does it get our juices flowing? Do we find it stimulating? Does it spur forward momentum? Does it get people going?” In their words:

The envisioned future should be so exciting in its own right that it would continue to keep the organisation motivated even if the leaders who set the goal disappeared.

Vivid description

Unlike a BHAG—which should be concise (usually no more than a sentence or phrase), easy to understand and capable of being expressed in a multitude of ways—a vivid description is an organisation’s opportunity to express in detail what it will feel like to achieve their goal.

For Collins and Porras, a vivid description is essential to making a BHAG tangible. Describing the achievement of the BHAG is about “painting a picture with your words”—a “vibrant, engaging” picture that brings your goal to life. For example, climbing Mount Everest is certainly a goal but how would it really feel to stand on that peak and look out across the mountain ranges below? What else would have already been achieved along the way?

Although it can be uncomfortable to express emotions in an organisational context and Collins and Porras readily acknowledge that some managers find this difficult, they also believe that “passion, emotion and conviction are essential parts of [a] vivid description”. It is precisely these ingredients that motivate others.

We must dispose of the widely accepted norm that rationality should rein supreme, and that emotion should be kept in check. Creating the right mission and describing it with vivid detail should release people’s passion and generate the commitment organisations need to achieve high performance.

One of the methods that Collins and Porras advocate for developing a vivid description is to write an article that you would love to see published about your organisation in 10, 20, 30 years from now. Imagine that you have achieved your BHAG and a major newspaper or business magazine is writing about your organisation—what would they say?

A last word

For Collins and Porras, their vision framework is about preserving the core (through the discovery of core ideology) and simultaneously stimulating progress (through the creation of an envisioned future). It is about managing both continuity and change.

…it’s not either core or progress. It’s not even a nice balance between core and progress but rather two powerful elements, inextricably linked and both working at full force to the ultimate benefit of the institution.

Collins and Porras believe that “without vision, organizations have no chance of creating their future, they can only react to it.” In contrast, when vision becomes an explicit part of an organisation’s DNA, they believe that the organisation has inherent capabilities to achieve their goals, to outlast changes in leadership, to weather organisational storms and, ultimately, to prosper.

Both authors acknowledge that an organisation’s journey will not always be smooth and it could even be said that visionary organisations will inevitably experience some failure but, in the words of Porras, “The key point is that visionary companies display a remarkable resiliency to bounce back from adversity and shine over the long term.”

And for those of you who like the research…

Brown, T. (1994). Greatness that endures. Industry Week. 12-22.

Collins, J.C. (2002). Vision framework. Available as a PDF from Jim Collins’ website

Collins, J.C. & Porras, J.I. (1991). Organizational vision and visionary organizations. California Management Review. 30-52.

Collins, J.C. & Porras, J.I. (1996). Building your company’s vision. Harvard Business Review

Collins, J.C. & Porras, J.I. (2000). Built to last: successful habits of visionary companies (3rd edition). London: Random House Business Books.

Reingold, J. & Underwood, R. (2004). Was “Built To Last” built to last? Fast Company

10
Feb
Posted by Matt Stocker, stored in: Performance Improvement  Technology & Web  

pile-of-papersChances are, if you are anything like most businesses, you have a lot of paper to deal with in your office and in your job. The fact is, we rely to a large extent on paper: to communicate, to record, to remind, to sell. The promise of a paper free office remains a technological fantasy for many.

However, it is important to recognise the scalability issues of paper as a technology: paper can only be in one place at one time so it doesn’t work well across multiple sites; revision control is tricky; and it can be hard to back up – do you have duplicate copies of everything if worst came to the worst?

Even if we cannot remove paper entirely, there are things we can do to consign it to a supporting role rather than the main deal within a business.

Steps to creating a paperless office

1. Analysing your processes

The first idea to grasp is the fact that paper usually relates to a process or processes within your organisation. Understanding this will provide a solid foundation for beginning to deal with the paper as the processes themselves provide the structural foundation for creating a paperless office. By analysing the papers for clues about the activities the paper itself represents and following this paper through the system, you can outline your processes, giving you an accurate view of ‘now’.

2. Revising your processes

The next step is to revise your processes in order to maximise efficiency. This includes:

  • Eliminating bottle necks and their resulting backlogs
  • Removing unecessary steps within the process(es)
  • Assessing crossover and interdependency of processes within the wider organisation to ensure integration
  • And, overall, designing as lean a process as possible.

Value stream mapping may be a good tool to use at this stage. The people involved in each process within your organisation will also be a vital source of information and feedback as they are the people on the ground who are involved in the processes day-in, day-out.

3. Integrating paper and technology

Having created a coherent set of lean processes, the next challenge is to reduce the use of paper where possible. This can be done by assessing the processes to find out which parts of them can be automated and then developing an IT and technology solution that has your best practice processes inherently embedded into its system. In other words, the IT and technology solution reflects and is built around your processes, rather than the processes being built around the technology.

4. Sustainable continuous improvement

Once you have found a solution that works for your organisation as a whole and that maximises your efficiency and effectiveness, it is important to maintain the momentum of improvement. Ongoing assessment and revision will ensure that as your organisation grows and develops your processes continue to support the delivery of your organisation’s objectives. New technology is also continually emerging that may provide a solution to paper based systems where a solution did not previously exist. Staying abreast of these developments allows you to continually improve organisational performance and efficiency.

5. Reducing risk

Although it is not always possible to eliminate the use of paper completely, you should not be relying on paper for mission critical functions. However, neither should you be relying on technology without a business continuity plan in place. Whatever system and solution you are using, you should always make sure that fail-safes and redundancies are built into the process(es).

If you would like any advice or support in creating a paperless office for your organisation, please contact me or call me on 02476 100 193 – I would love to help!