OGSM Model

DR. D.ULAMBAYAR

Ulaanbaatar

2019.04.06

OGSM ModelObjectives, goals, strategies and measures (OGSM)is a strategic planning process that provides clear goalsand identifies the strategic choices to achieve them. Itdefines the measures that will be followed to assure thatgoals are met and helps groups work together towardcommon objectives, across functions, geographicaldistance and throughout the organization. OGSM’sorigins can be traced back to Japan in the 1950s,stemming from the process and strategy workdeveloped during the Occupation of Japan, post-WorldWar II. It has since been adopted by many Fortune 500companies. In particular, Procter & Gamble uses theprocess to align the direction of their multinationalcorporation around the globe.

PurposeThe OGSM framework forms the basis for strategicplanning and execution as well as a strong managementroutine that keep the plan part of the day-to-dayoperations. It aligns the leaders to the objective of thecompany, links key strategies to the financial goals, andbring visibility and accountability to the work ofimproving the capabilities of the company. Due to theconcise format (usually one page) and simple color-coding to signal progress, OGSM allows for quickmanagement by exception of any underperformingactivity. And finally, it is simple, robust and developed asa team.OGSM is designed to identify strategic priorities, capturemarket opportunities, optimize resources, enhance speedand execution, and align team members.

HistoryAlthough research indicates that this method was developed by Procter& Gamble (Kingham and Tucker) and is commonly used by manyconsultancies, the verifiable origins of OGSM are unclear.Brought from Japan to corporate America in the 1950s, the OGSMconcept was used initially by car manufacturers. Today largercorporations, including Fortune 500 companies, employ this frameworkto keep their workforces centered on goals and objectives. Ideally thistool can express in a one-page document what a traditional business plantakes 50 pages to explain.Development in the U.S.The OGSM has been employed by multinational corporations aroundthe 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 ideastranslate into organizational practice. CEO A.G. Lafley wanted toprovide a framework for organizing the discussion about goals andstrategic direction so he used the OGSM tool.

How to develop an OGSMA 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 OGSMWhen 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 strategyAfter a mergerWhat sort of timeline an OGSM should entailThe strategic plan is typically for three to five years, with a refresh every six months to a year. Other methodsOther 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.

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