What is OGSM?
Fast and effective planning with OGSM
OGSM is a simple and effective framework for strategic planning and strategy execution. It is used by companies, governments, NGOs and individuals alike. As long as you have the courage to make the big choices, OGSM will help you create a well-structured plan that empowers you to achieve your organisation’s goals.
OGSM is one of the premiere strategic frameworks for managing organisations. The name is an acronym for Objective, Goals, Strategies & Measures, which are the main components of this model.
More than simply creating a plan, OGSM also guides you through the steps to make your goals actionable: because realizing your dreams is even more fun than dreaming them. OGSM has four main advantages:
- Simplicity. OGSM is a clear and easy-to-understand model that summarises your essential strategic choices on a single page. This also makes it a good tool for communication, because it is much easier to understand and interpret than a long written strategic document.
- Coherence. OGSM makes explicit, logical connections between five different aspects of a strategic plan. These aspects are your objective or mission; your quantitative goals; the strategies you choose to achieve those goals; the way you measure progress towards the goals; and the actions or projects planned to realize the strategies.
- Clear choices. Because OGSM is a strict logical framework limited to a single page, it forces you to make clear choices. Using this framework, every action and project your organisation or team works on, must be connected to your organisational goals. In that way, OGSM helps you identify any outdated or less-relevant projects and work more efficiently. This aligns perfectly with the Lean philosophy, and a clear and differentiated strategic focus is the result.
- Flexibility. OGSM is a flexible framework that can be adapted to multiple levels of an organisation. For example, you have made a plan on one page for the strategic change of a whole organization. That may not be immediately executable for individual departments or teams. But by linking higher-level to lower-level OGSMs (a process called cascading), you can make your strategic plan concrete and executable at each level.
Why use OGSM?
OGSM is commonly referred to as a business planning method, but you can use the framework to design and execute any type of plan: department plans, annual plans, project plans, personal plans and any other plans. Essentially, OGSM takes a clear goal and subsequently translates this goal into concrete steps and a way to execute them. It’s a uniquely simple, well-structured and effective method that you can use to achieve any goal without unnecessary complexity.
What does OGSM stand for?
OGSM is short for Objective, Goals, Strategies & Measures. Together these components form the basis of a good and effective business plan on 1 page.
The Objective describes the conditions that you want to achieve during the agreed-upon time period. It sets the direction for the whole plan. This objective should be:
The Goals section of your OGSM translates your Objective into a set of clear and measurable targets that must be achieved to realize it. Goals tend to include key financial targets like market share, profit, numbers of clients, or revenue. They can also include other numbers relevant to your organization’s performance, such as client satisfaction, employee churn or ESG goals. Goals must be SMART, meaning: Specific, Measurable, Attainable, Relevant, and Time-bound.
Strategies are the roadmap to the realization of your Objective. If your Objective defines the ‘what‘ you hope to achieve with the strategic plan, your Strategies should describe how you will do that. Selecting good Strategies is crucial to good performance for any organization. These will define the areas of focus for your strategic plan. When writing your Strategies, it can be helpful to keep a list of strategic areas in mind that tend to be relevant for most organizations. These are Customer, Product, Processes, Partners, and Innovation. Sometimes, you may also want to add ESG as an area.
The component of OGSM called ‘Measures’ really consists of two separate elements: a ‘Dashboard’ and an ‘Action Plan’. This split within Measures is not native to OGSM, but was introduced to improve the clarity of the model by Marc van Eck (one of our co-founders) & Ellen van Zanten.
- The Dashboard Measures include the key performance indicators that tell you whether or not a strategy is on track;
- The Action Plan includes the projects or actions that you execute as part of your Strategies, as well as data on who & when will execute them.
OGSM, the 1 page business strategy
Do you want to know more about the OGSM methodology, find out how to make a good OGSM yourself, or have your own go-to guide for any questions related to OGSM?
All you need to know about the OGSM methodology is summarized in the handbook: The 1-page business strategy, written by one of our founders, Marc van Eck. The Dutch version of the book has been a bestseller on managementboek.nl and bol.com for over 5 years. The book is available in Dutch, English and Mandarin.
Get yours here:
When did OGSM originate?
In the mid-twentieth century, a man named Peter Drucker introduced a management style called Management by Objectives, which eventually evolved into OGSM. The general idea of Management by Objectives is that management and employees should set goals together, because by agreeing together on goals that are challenging but achievable, you motivate and empower everyone involved. For that reason, Drucker wanted to link the goals of the employees of an organisation to the goals of the organisation itself.
The management method was first applied by NASA. The goal of getting the first man on the moon was split into sub-goals and divided over various teams. These teams in their turn translated these sub-goals into sub-sub-goals and those were assigned to sub-teams, and so on. In this way, everyone was involved with setting the goals that helped motivate the entire team. Every employee knew what his or her team’s objective was, and knew that if they had achieved their objective, they had contributed to the achievement of putting the first man on the moon.
After getting the first man on the moon, various major car manufacturers in Japan noticed NASA’s success and developed Drucker’s ideas into the model we now recognize as the OGSM methodology. OGSM is now being used as the main tool for strategic planning by companies such as Procter & Gamble, Coca-Cola, Mars and many other Fortune 500 organisations wordwide.
Five secrets to a good OGSM
We’ve mentioned a couple of times that it is necessary to make clear choices in order to get a quality OGSM, and that practice has shown that less is more. But how exactly do you create a good OGSM? Here’s our five essential tips:
1. What-by-How approach
Clear and sharp choices are made using the What-by-How approach. This is a component of OGSM that has been added by Marc van Eck & Ellen van Zanten. What-by-How means that your Objective, Strategies and Actions should consist of two elements: a ‘What’ part and a ‘How’ part. For example: “Deliver a new website by collaborating with a web development partner.” What is it that we want to achieve? And how are we going to achieve this? Always take a moment to reflect on the decisions you made in your OGSM and ask yourself: do I have both a ‘What’ and a ‘How’? In case you didn’t, you now know exactly what to change!
2. Sharp and Smart Goals
In other management methods, achieving even 75% of the goals may lead to great enthusiasm, but that’s not the case with OGSM. With OGSM, everything should be planned to be realistic and achievable. For that reason, it’s very important that your Goals are clear and that you make them SMART. Specific and measurable goals have a percentage, a measure, or a number in them, ensuring you can ‘tick the box’ once you have achieved them. The goals should be ambitious, but achievable: they need to really make a difference. The desired result should be well-defined, and you should specify the exact timing for you to reach that Goal. You should aim to reach all the goals at the end of the set time period.
3. No more than five strategies
When it comes to Strategies, we tend to say less is more. But how many is too many? A maximum of 5 strategies is recommended, because you tend to get better results out out of handling a few Strategies really well. This forces you to make clear strategic choices and not spread your efforts too thin.
4. Choose existing measurements
It is wise to choose Dashboard Measures for your OGSM that are already being used in the organisation. Experience shows that it’s often more efficient to use an existing measurement that is 80% associated with being on track, than to set up a new measurement that is 100% aligned. If you do decide to use a new Dashboard Measure, take some time to think carefully about how you can do this as practically as possible.
5. Monitor your plan
Setting up your OGSM is only the beginning. Following up on your plan and habitually working within the framework of the OGSM is key. In the follow-up process, you should constantly reflect on the strategies and measures and make adjustments as you go. This ensures that the OGSM stays representative for your organization and that people still feel enthusiastic about it. Continue to apply the mechanics of OGSM as well as possible. If your OGSM starts to show technical inaccuracies, this can have serious consquences for the effectiveness of the framework.
OGSM Example: Jeep
One example from “The 1-page business strategy” is an OGSM made for Jeep. We have imported this example into OGSM Software for you to learn from. The Jeep example can show you exactly how the software works and how your Action Measures should be linked to your goals. That way, you’ll ensure that everyone is doing the right things to reach the Objective.
What does cascading your OGSM mean?
In essence, cascading means little more than splitting up your main Objective into a number of smaller sub-goals that, if realized, together add up to the Objective. These sub-goals then operate as the Objectives of one or more underlying OGSMs.
The Strategies of the higher-level OGSM are then ‘translated’ to the relevant level of the sub-OGSM. For example, a Customer strategy on the organisational level can be concretised into a marketing strategy for the marketing department. In short: by cascading, you can make your Goals and Strategies more concrete and manageable at different levels of your organisation. Individual departments, teams and employees can work on lower-level objectives and strategies that are relevant for them, without losing sight of the higher-level strategic objective.
Need help cascading your OGSM?
Why OGSM Software?
Whether you are an experienced user of OGSM or still new to it all, managing and executing your strategy becomes a pleasure with this easy-to-use tool. OGSM Software will help you see the bigger picture – anywhere, anytime.
- You can read more about OGSM on Wikipedia here.
- Learn more with the book “The one page business strategy”.
- Check out our pages on OGSM preparation: PEST analysis, BCG Matrix & Business Model Canvas.
- Learn more about cascading your OGSM with our cascading guide.
- Check out our blog for more information on how clients use OGSM and OGSM software!
OGSM is a simple and effective framework for strategic planning and strategy execution. It is used by companies, governments, NGOs and individuals alike.
OGSM is a proven method that used by organisations around the world, including Fortune 500 businesses like Coca-Cola, Procter & Gamble and Honda. It is simple, coherent, flexible, and facilitates clear choices.
OGSM is an acronym for Objective, Goals, Strategies and Measures. These are the main components of any OGSM plan.
OGSM evolved from Peter Drucker’s Management by Objectives. This method was later improved by Japanese car manufacturers and spread around the world.
There are some key tips to making a good OGSM. We’ve shared five secrets in the article above. For access to our ‘cheat sheet’ with useful checklists and examples, please send us an e-mail at email@example.com.
Cascading means using multiple interconnected OGSM plans. This helps make your strategy execution more specific to different time frames, departments, regions, or levels of your organisation. For tips, see our cascading page.
OGSM Software is a cloud-based tool designed for effective strategy design and execution. It’s secure, flexible and user-friendly, and can be used by any organisation that wants to take their performance to the next level. Try it for free here!