OGSM

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.
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 brings 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 or underperforming (key) performance indicator. 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.
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.
Managing the OGSM over time.
The strategic plan is typically for three to five years, with a refresh every six months to a year. Others recommend the OGSM be used as a one year business plan, with actions reviewed monthly and goals and measures either monthly or quarterly in order to more effectively adapt to changing market conditions. An OGSM can be kept up-to-date manually, or in a dynamic fashion using custom software tools.
Other methods.
Other comparable strategic frameworks are Hoshin Kanri X-Matrix (part of LEAN), Balanced Scorecard (BSC – developed by Kaplan and Norton), OKR (Objective Key Results), EFQM (European Foundation of Quality Management) and OEI (objective, entity, infrastructure – developed by A. Boyd). These frameworks can provide strategic guidance to other practices like LEAN, Catch ball and Agile.
Marc van Eck explores the benefits of OGSM and how it compares with other popular management methodologies.