OGSM model: your strategy on one page, from ambition to action

What is the OGSM model?

The OGSM model is a one-page format for a strategy. OGSM stands for Objective, Goals, Strategies and Measures. On one sheet you write where you want to be in a few years, how you will know you got there, which choices take you there and how you track and carry out each choice. The page then becomes the agenda for every progress meeting.

The value lies in the limit. A long document can hold every wish; a single page cannot. You pick three to five goals and three to five strategies, and show how each action connects to them.

The origin of OGSM is not well documented. It is often linked to post-war Japanese management practice, where goals were deployed through every level of a company (policy deployment, or hoshin kanri), and to its use at Procter & Gamble. These accounts are hard to verify. What matters is what the format makes you do.

The four parts of an OGSM

The logic runs upwards: every action serves a strategy, every strategy serves a goal, and the goals together prove the objective.

How to make an OGSM in six steps

1. 01

   Start from a choice you have already made

   An OGSM records a strategy; it does not create one. If the options are still open, first evaluate and choose.

2. 02

   Write the objective

   One sentence: for whom you want to be what, and why they would choose you. Test it by asking whether a competitor could sign the same sentence.

3. 03

   Make the goals measurable and test them

   Give each goal a start value, an end value and a date. Check margin targets against your industry with benchmarking and check that the financial plan can carry them.

4. 04

   Choose the strategies

   Three to five choices, each contributing to at least one goal. Include at least one thing you will stop doing, so the new work has room.

5. 05

   Link measures and actions

   Per strategy, two or three measures, at least one of them leading, and the actions with an owner, a date and a budget.

6. 06

   Test, cascade and set the rhythm

   Check the page against the budget, let departments write their own, and review measures and actions quarterly, objective and strategies yearly.

How to write SMART goals for your OGSM

Fictitious Firmfocus example, taken from the worked OGSM below.

The SMART test goes back to George Doran, who proposed that objectives be specific, measurable, assignable, realistic and time-related (Management Review, 1981). Most versions now read "achievable" and "relevant" for two of the letters. Use SMART as a test, not a template: a goal can pass every letter and still be the wrong goal.

Why goals work, and when they backfire

Edwin Locke and Gary Latham summarised decades of research: specific, difficult goals consistently led to higher performance than urging people to do their best, and the effect was strongest when people were committed and received feedback on their progress (American Psychologist, 2002). In OGSM terms, the goals row works only together with the measures row, because the measures provide that feedback.

Goals also have side effects. Lisa Ordóñez and colleagues warned that goal setting can be overprescribed, with a narrow focus that neglects everything outside the goal, distorted risk-taking, a rise in unethical behaviour, inhibited learning and damage to culture and motivation (Academy of Management Perspectives, 2009). Keep goals few, pair a growth goal with a margin or quality goal, and avoid large bonuses tied to one number.

Richard Rumelt adds a strategic warning: mistaking goals for strategy is one of the hallmarks of bad strategy (McKinsey Quarterly, 2011). The strategies column must contain choices about how you will win, not more targets.

OGSM example: a testing laboratory moving to contracts

Kestrel Analytical tests food, water and environmental samples. It has 85 staff and revenue of €9.0 million, three-quarters of it from one-off jobs. Large laboratory groups compete on price, while mid-sized food producers want faster results and fewer suppliers. The management team chose to become the regular laboratory for those producers through monitoring contracts.

Objective and goals

• G1 Revenue: from €9.0 million to €12.0 million in year five.
• G2 Contract revenue: from 25% to 55% of revenue in year five.
• G3 Operating margin: from 7% to 11% in year five.
• G4 On-time results: from 88% to 95% of results within the agreed turnaround, from year two, measured monthly.

Strategies, measures and actions

Fictitious Firmfocus example. Amounts in euro; the logic works in any currency.

Every action traces back to a strategy and every strategy to a goal. The year-one actions return as initiatives in the implementation plan.

Cascading an OGSM to departments

Each department writes its own page, in which a company strategy becomes its objective. Go no more than two levels down.

Fictitious Firmfocus example.

OGSM, OKR or Balanced Scorecard?

OGSM pitfalls

• Goals in the strategies column: "grow contract revenue" is a goal; "sell monitoring packages to food producers" is a strategy.
• Too many strategies: more than five means no real choice has been made.
• Words without a choice: "customer-focused" or "excellence" rule nothing out.
• Only lagging measures: revenue and margin tell you too late. Add a measure that moves first, such as turnaround or contracts signed.
• Actions without an owner or budget: they stay intentions.
• A page nobody discusses: without a quarterly review, the OGSM becomes a poster.

OGSM in a small business and a larger organisation

OGSM is the goal-setting building block of execution and control. For quarterly team goals, see OKRs; to show how drivers lead to results, see the Balanced Scorecard. Every topic is in the strategy overview.