It Pays to Get Emotional

Insights gleaned from working with passionate entrepreneurs at a recent public Business Growth Scaling Up Workshop. It is more than just the numbers!

Published September 29, 2019

Don't make it just about the numbers

Make some Big Hairy Audacious Goals

I had an inspiring day working with a great group of Start Up and Scale Up organisations during my Public Scaling Up Business Growth Workshop at Stone & Chalk Technology Start Up Hub in Sydney.

We spent the day exploring Verne Harnish’s Rockefeller Habits 2.0 and how they can accelerate your Scaling Up experience.  Tens of thousands of Founders and CEO’s have over the past three decades implemented Scaling Ups simple, practical, and actionable tools. These tools have been leveraged to great success:

  • doubling cash,
  • tripling profit, and
  • significantly increasing their company’s valuation.

During this session we got into some inspiring conversations around the foundational topics of Purpose and also deciding on what Jim Collins and Jerry Porras labelled in their business book Built to Last: Successful Habits of Visionary Companies your Big Hairy Audacious Goal or BHAG™ for short.

A BHAG™ encourages organisations to define visionary goals that are more strategic and emotionally compelling … Collins and Porras define a BHAG™ as ‘an audacious 10-to-30-year goal to progress towards an envisioned future'


The key word for me when working on your BHAG™ is ‘emotionally’ – helping get my clients out of their heads and into their gut and heart is some of the most satisfying work.

Transitioning from a long-term goal of $10billion in revenue to a statement that is emotionally charged with purpose, similar to the examples above, is an exciting experience.

I get that hitting large revenue targets is a very satisfying experience. In reality though, your revenue targets are just the score in the ‘game of business’. Yes, it is a great ‘marker’ of progression, scale, and success. It is unlikely though, to be the reason why your team get up in the morning fired up to give you their best and help you achieve that BHAG™. It certainly is unlikely to be why one would choose to buy your product or service … “please take my money so I can help you get to $10billion turnover”.

If you need some inspiration Wikipedia, again, goes on to share some notable examples:

“This nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to the earth.”
John F. Kennedy’s Moon Challenge

“A computer on every desk and in every home.”

“By 2020 no one should be killed or seriously injured in a new Volvo.”

Defining your Big Hairy Audacious Goals

A great place to start defining your Big Hairy Audacious Goals is to answer these three questions:

  • What is your core purpose?
  • What drives your economic purpose?
  • What can you be the best at in the world?
1. What is your Core Purpose?

In his book, Conscious Capitalism, John Mackey identifies what he sees as the four key types of Core Purpose:

The Good – service to others: For example; The Container Store – “improve the quality of our customers’ lives through the gracious gift of organisation”

The True – search for truth & knowledge: as in Google’s above “Organize the world’s information and make it universally accessible and useful.”

The Beautiful – pursuit of beauty: Exemplified by Apple with their elegant product design

The Heroic – desire to change the world: epitomised by the Grameen Bank micro lending for the impoverished without collateral

Which one might it be for you?

Knowing your type of Core Purpose is key but to take it to the next level you also need to, as Jeff Klein (CEO of Working for Good) says, make sure it is “…an activating, motivating and animating force. It moves us to get up in the morning, sustains us when times get tough and serves as a guiding star when we stray off course.”

For many of us it can be quite challenging to actually get clarity on what our Core Purpose is and recognise it is likely to require a number of iterations before you have it nailed.  A good way to start is to ask yourself, or do it as a group, questions along the lines of:

  • What is the higher purpose of the company beyond profit and the creation of jobs?
  • Why did you start the company in the first place?
  • What is going to engage your team emotionally?  Why will they drive through and around the inevitable obstacles that will come their way?

Hit the button to grab your Scaling Up Core Purpose tool to help you unearth what it might be for you.

2. What DRIVES your Economic Engine?

What is the one number, that if your team all focused on improving would increase profit and liquidity?

What is your Profit/x?

Recognise that it needs to be an “x” that is measurable, ignites passion in your team – they care about improving it, promotes discipline and drives the economic engine. It has a direct impact on cash or profit.

New System Laundry is a textile and linen service company in the Pacific Northwest (United States), serving the restaurant, hospitality and healthcare industries. They pick up, clean, fold and deliver linens, work apparel, and other textile goods for their customers. After several collaborations among the leadership team, they identified the most controllable and scalable measurements for Profit per X as “Gross Profit per Delivery”.

Overhead expense is not included in this approach and the objective is to maximize revenue per client delivery (upsell and layer more products/services for existing clients to use) and to minimize the cost to do so (reduce transportation, labor, COGS for client delivery).

The concept of “Gross Profit per Delivery” is becoming a focal point for ALL employees in New System Laundry through time. If every team member can grasp the concept of “Gross Profit per Delivery,” then they can simply ask themselves and work with their direct managers to determine how their day-to-day role contributes to optimizing it.

Similarly how much easier is it for Southwest Airline team members to make decisions about what they do, how they behave knowing their Profit per X is “Profit per Plane” compared to the industry standard of “Total Revenue per Available Seat (TRASM)”.

Some questions worth asking include:

  • What is your industry’s standard benchmark?
  • What products and/or services drive your top line?
  • What cost drivers are critical to profit that you can control?
  • What “units (x’s)” would you want more of versus less of?
  • What “units (x’s)” can you optimise and competitors are not focused on?

Remember, the goal is to choose a Profit per X that you can control or influence strongly and can scale.

3. What can you be the best at in the world?

When Jim Collins and Jerry Porras talk about the Hedgehog concept it isn’t about a goal to be the best, a strategy to be the best, an intention to be the best, a plan to be the best…. It is an understanding of what you can be the best at.

This is about your core competencies – what activities and aspects of your company make you operationally different and superior to your competitors? What experience can you create for your customers through your operational activities, processes that give you a competitive edge?

What might be the complex compilation of processes, systems, and activities within your operations that actually appear simple on the surface to a casual observer but are the result of years of honing how you do things.

C.K. Prahalad and Gary Hamel share in their Harvard Business Review Article The Core Competence of the Corporation three great ‘tests’ of your Core Competence:

  • Provides potential access to a wide variety of markets
  • Makes a significant contribution to the perceived customer benefits of the end product
  • Difficult for competitors to imitate

As you bring the three elements together; Core Purpose, Economic Engine, and Core Competence to define your long-term aspirations, your BHAG™, remember to look for every opportunity to express it as emotionally as you can. It may take a few iterations but you will ‘feel’ it when you get it.

Let me know how you go, would love to see what BHAG™ you create.

Keep Scaling Up!