Objectives, goals, strategies and measures (OGSM) is a strategic planning process that provides clear goals and identifies the strategic choices to achieve them. It defines the measures that will be followed to assure that goals are met and helps groups work together toward common objectives, across functions, geographical distance and throughout the organization. OGSM's origins can be traced back to Japan in the 1950s, stemming from the process and strategy work developed during the Occupation of Japan, post-World War II. It has since been adopted by many Fortune 500 companies. In particular, Procter & Gamble uses the process to align the direction of their multinational corporation around the globe.
Video OGSM
Purpose
The OGSM framework forms the basis for strategic planning and execution as well as a strong management routine that keep the plan part of the day-to-day operations. It aligns the leaders to the objective of the company, links key strategies to the financial goals, and bring visibility and accountability to the work of improving the capabilities of the company. Due to the concise format (usually one page) and simple color-coding to signal progress, OGSM allows for quick management by exception of any underperforming activity. And finally, it is simple, robust and developed as a team.
OGSM is designed to identify strategic priorities, capture market opportunities, optimize resources, enhance speed and execution, and align team members.
Maps OGSM
History
Although research indicates that this method was developed by Procter & Gamble (Kingham and Tucker) and is commonly used by many consultancies, the verifiable origins of OGSM are unclear.
Brought from Japan to corporate America in the 1950s, the OGSM concept was used initially by car manufacturers. Today larger corporations, including Fortune 500 companies, employ this framework to keep their workforces centered on goals and objectives. Ideally this tool can express in a one-page document what a traditional business plan takes 50 pages to explain.
Development in the U.S.
The OGSM has been employed by multinational corporations around the globe, including but not limited to: Coca-Cola, Procter & Gamble, KPN, Reckitt Benckiser, Honda, Mars, MetLife, Triumph International.
Procter & Gamble (P&G) provides an example of how these ideas translate into organizational practice. CEO A.G. Lafley wanted to provide a framework for organizing the discussion about goals and strategic direction so he used the OGSM tool, as illustrated here:
Considerations
How to develop an OGSM
A clear, concise objective drives the rest of the OGSM model. The objective should be worded as a customized, specific statement that is specific to the organization. Goals should be numeric, usually over three to five years, financial and/or operational and should support the objective. The strategy should also use words which are focused and clearly written, typically around growth, productivity and people. Measures should be a numeric representation of the strategic that are traceable and have one owner.
When to employ OGSM
- When a large-scale strategy and goal-setting seems unsurmountable, OGSM is a scalable solution.
- If no formal strategy planning process exists, or if current goals do not align with an existing strategy
- After a merger
What sort of timeline an OGSM should entail
The strategic plan is typically for three to five years, with a refresh every six months to a year.
Other methods
Other methods to measure the effectiveness of symbiotic relationships: balanced scorecard (BSC - developed by Kaplan and Norton), OEI (objective, entity, infrastructure - developed by A. Boyd), and GQIM (goals, questions, indicators and measures - developed by researchers at the Software Engineering Institute). Ellen Leenhouts and Marc van Eck explore the benefits of OGSM and how it compares with other popular management methodologies.
References
Source of the article : Wikipedia
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