Establish OGSM
Once mission and vision statements have been set, a
company should establish its OGSM.
"Objectives, goals, strategies, and measures
are the four components that take your vision and
purpose to executable, tangible things," says Donnan.
A company's objectives should express in
words what needs to be achieved, he explains. "They
might be objectives around quality or sales growth
or profitability, he says. An example is "maintain
share leadership while delivering profitable growth."
Goals should express in numbers and dates
progress toward objectives, he says. "Your goals, for
instance, might be to hit $10 million in sales or $3
million dollars in profits" by a certain date.
Strategies should express in words the
individual initiatives to achieve the goals, while
measures, expressed in numbers and words, are clear
metrics to evaluate success, according to Donnan,
who provides as example reducing manufacturing
costs from $100 per ton to $80 per ton.
OGSM can more easily be visualized through
Donnan's example, related to golf, below.
Leading and Lagging Indicators
When it comes to determining measures, it's
important to have a mix of both leading and
lagging indicators, Donnan says.
"Measures like sales, volume, costs, and profit
are all lagging indicators and they measure the
outcomes that were achieved," he explains. "Leading
indicators such as competitive activity, commodity
prices, and consumer sentiment are used to give a
prediction of what will happen to the market and to
adjust strategies. They are more difficult to measure
and interpret, but helpful to know when things are
changing."
Companies should visit their OGSM
periodically to see if any strategies need adjusting,
advises Donnan.
"Sometimes the environment changes with
new customers, new competitors, shifts in demand,
or supply chain disruptions," he says. "While the
mission and vision stay intact, the strategies to get
there may need to change. Sometimes if the change
is significant the goals may change as well. For
example, if a price war occurs and the objective on
maintaining pricing is no longer valid, the goal and
strategy may need to be adjusted."
Example: Improving One's Golf Game—Using OGSM
Vision Mission
Become a Scratch Golfer Practice golf as you improve your score
Objective Goals Strategies Measures
• Become the most improved
golfer in your club
• Reduce average score per
round by 4 strokes
• Get into top-30 in club
rankings
• Improve your putting
• Get a coach
• Play more often
• Play against better players
• Achieve average of 2
or less putts per hole
• Play per week:
• 1x Round
• 1x Driving Range
• 1x Coaching
• Select partners averaging
10pts lower handicap
Words Numbers Words Numbers & Words
Companies should visit
their OGSM periodically to
see if any strategies need
adjusting, advises Donnan.
FALL 2021 49
Julie Gallagher is managing editor for Specialty Food.
