Have you wondered how to use the OGSM methodology in practice or have been looking for an instructional OGSM example? Meet Tony! Tony is a fictional character who has applied the OGSM approach to strategy in his restaurant business.
OGSM stands for Objective, Goals, Strategies and Measures and is a one-page business plan that defines ‘what’ you aim to achieve and ‘how’ you are going to achieve it. As part of a strategy process, the framework guides through setting the objective and the goals first (the what) and then defining the strategies and measures (the how).
In this fictional example you will learn step-by-step how to apply the OGSM methodology to strategic planning in a small business. You can download the example as PDF document for free at the end of this article.
OGSM example for small business
Tony is the owner of a small chain of pizza restaurants called Tony’s Pizza. There are two locations in the tri-state area. After weeks of wondering whether small businesses should do strategic planning, Tony has gathered his team to review their strategy and identify new areas of growth. Having subscribed to Rock Your Strategy, Tony is beginning with a discussion of the mission of the business.
“Easy!”, exclaims Stefano, head chef of the chain and designer of its menu. “All we have to do is expand the menu beyond pizza. We are an Italian family restaurant after all! Diners want antipasti and secondi!”.
“Italian family restaurant?” asks Jen confused. Jen is Tony’s wife and takes care of the company’s finances. “Honestly, we are a pizza parlor. We make pizza and sell pizza. People come here because we have the best pizza at the best prices. People don’t come here for the ‘dining experience’”.
Brian, the part-time delivery driver, looks up from his smartphone. “Actually, I do get asked occasionally when I deliver pizzas whether we are only a pizza delivery service or whether we have a sit-in restaurant as well. It seems customers are not aware of our two restaurant locations.”
Tony realizes that this is going to be more difficult than he had expected. Ten minutes into the meeting and there is no consensus about what kind of business they are actually running today: a family restaurant, a pizza parlor, or a pizza delivery service? Tony senses that clarity about today’s business is needed before they can discuss how to identify future opportunities for growth.
Setting the objective
Reviewing the business had been an exciting journey for Tony and his team so far. They studied their business financials and customer feedback. They reviewed local economic data and sifted through competitive insights. Tony and Jen even dined a couple of times in different restaurants in the city to see what other restaurants were doing.
Tony was pleased to read how much customers loved their pizza. Particularly their pizza dough and his family’s secret pizza sauce received rave reviews. Tony had introduced his grandmother’s Sicilian recipe four years ago and since then their pizzas almost sold themselves.
In their analysis, Tony was surprised to see population growth figures in the tri-state area and rising GDP per capita. It’s true, more and more young families had moved to their town from the city over the past 5 years ever since the new interstate was built. But he hadn’t realized how much bigger the town had become.
Speaking with the mayor, the chamber of commerce and other small business owners, Tony learned that their town had become a popular dwelling for families who sought more space outside the city but were not willing to give up their modern city lifestyles. The only thing missing really was more dining choices. There were a couple of pizza restaurants, fast-food chains, and a steakhouse. After all, they had been doing well in this setting with their pizza parlor for many years. But Tony was curious whether a proper sit-down family restaurant with Italian cuisine would be a popular niche not yet served.
After further studying the possibility, Tony and his team made a decision. They were to transform one of their pizza parlors into a family restaurant. Tony captured their objective:
Tony’s aims to expand beyond its delicious pizzas to become a trusted Italian restaurant where families feel at home by offering enjoyable, freshly cooked Italian meals.
Tony looked up and felt proud. This sounded like a great objective. He could already see the smiles on happy customer faces and smell the intoxicating scent of fresh Italian dishes being served.
Defining the goals
Tony had decided to sleep over his freshly drafted objective statement. This is something he had learned from his late mother: important decisions should not be made lightly. Tony could still remember the ring of her voice in his ears, “a good night’s sleep will bring clarity and determination.” And that was the case.
Coffee in hand, Tony and his team resumed discussion on their new strategy. They sought to create 3-5 strong strategic initiatives that would help them turn their pizza parlor into an Italian restaurant local residents would love.
But first, Tony reminded his team, it was important to translate the objective statement into quantifiable goals so that they knew what success looked like and could measure their progress.
Tony had read on Rock Your Strategy that translating the objective into goals meant creating clearly measurable SMART goals for every aspect of the objective statement. So they went to work.
First they divided the objective statements into several parts and wrote each part on a flipchart. Then for each part, they defined 1-2 SMART goals.
|Tony’s aims to expand beyond its delicious pizzas||Revenue $50K / month,>50% of revenue from non-pizza items|
|to become a trusted Italian restaurant||>30% of people in tri-state area are aware of Tony’s new Italian restaurant>70% of customers are local repeat customers from the tri-state area|
|where families feel at home||>80% of customers recognize Tony’s as “family-friendly” and “homely”|
|by offering enjoyable, freshly cooked meals.||>80% of customers indicate “high food quality”>90% of customers indicate they “enjoy” their meals<1% of dishes are returned|
Having defined the objective statement and broken it down into 8 concrete goals, Tony filled them into the OGSM template which he had brought to the discussion.
Now that they knew what they wanted to achieve, Tony, Jen, Stefano and Brian turned to how they were going to get there.
It had felt odd to Tony at first when Jen had suggested they do a SWOT analysis for their business. They were a family restaurant after all, he had insisted, not a glizzy corporation in the Fortune 500. But Jen had relented, as she usually did. And in the end Tony was glad that she did. When they were brainstorming their strategic initiatives, the SWOT analysis did come in handy.
The team further debated several aspects of successful Italian restaurants they knew. But the longer they discussed, the more they came back to two important principles. They wanted to create a restaurant that remained true to Tony’s roots and values and that reminded people of the cozy pizza parlor heritage. And they wanted to make sure that the restaurant was unique to the tri-state area and incorporated features of the community.
Tony paused, “Wow, that’s it! Before we go any further and define our strategies, let’s make this our vision. I think it would be important that we not only define an objective for the next 3 years, but that we have a longer term vision that we strive for. I want everyone at Tony’s to know who we are and what we stand for. And I want our guests to feel it too.”
Tony walked to the flip chart and and wrote in big letters:
The best fresh, authentic Sicillian food at home in the tri-state area.
Tony took a step back before he approached the flipchart again and underscored the words fresh, authentic, and home. Yes, now they were ready to choose their strategic initiatives.
At the end of the day, they stared at 5 scribbled statements on scattered flipcharts. At that moment they knew they had nailed it.
- Offer dishes the entire family will love by developing an authentic Italian menu with Tony’s all-time classics and rotating seasonal specialties
- Serve great-tasting, freshly cooked food by sourcing most ingredients fresh from the local tri-state area
- Turn customers into guests who feel at home by designing a cozy restaurant interior that reminds people of a small-town Italian trattoria.
- Hire and train experienced employees who embody Tony’s values and make guests feel at home.
- Make people in the tri-state area aware of Tony’s new dining experience by implementing marketing initiatives that create interest to give the new Tony’s a try.
Jen recorded the strategies on the OGSM template before they called it a day.
Defining the measures
It had been a heck of a day. The oven at Tony’s prime location broke just as they were pre-heating in the morning before the busy lunch hour. Thursday was pizza day at one of the larger companies in town and many of the employees usually came in for Tony’s special set lunch that day.
The initiative had started 5 years ago shortly after Tony started his first pizza parlor. Tony lost a game of golf to the owner of the business. What was making good on a bet at first had meanwhile grown into a weekly custom: Thursday was pizza day! Today however it was a nightmare. Instead of working on the measures of their strategy as they had hoped, Tony and Jen spent the morning scrambling to get parts to fix their oven.
This reminded Tony that strategy was not about getting his head into the clouds but to develop a very real approach to real progress. At the same time, he didn’t want to get discouraged by the mishaps of the day-to-day and continue working on the measures the next day. And so they did.
When Tony, Jen, Stefano and Brian resumed the next morning they had the task to break down each strategy into meaningful metrics and initiatives that would drive implementation of the strategies.
After several hours of discussion, they had defined as measures several SMART metrics and 2-3 key initiatives per strategy.
|Strategies||Key Metrics||Key Initiatives|
|Offer dishes the entire family will love by developing an authentic Italian menu with Tony’s all-time classics and rotating seasonal specialties||⅔ of food choices non-pizza|
>5 kids menu items
10 shareable appetizers
5 new food items every season
2 new wines every season
|Create new food menu by reviewing existing menu and adding new Sicilian choices|
Create new drink offering by reviewing existing drink list and adding an Italian wine list
Develop new, shareable food items by combining inspirations from the local area and Sicilian food culture
|Serve great-tasting, freshly cooked food by sourcing most ingredients fresh from the local tri-state area||80% of customers recognize “freshness”|
75% of ingredients from tri-state area
Food costs <30% of operating income
|Learn customer tastes & preferences by creating a short survey and asking guests to fill when settling bill |
Identify new supplier of fresh vegetables by contacting local vendors
|Turn customers into guests who feel at home by designing a cozy restaurant interior that reminds people of a small-town Italian trattoria.||80% of customers indicate they “feel at home”|
50% of customers comment on “Italian” feel or experience
|Make guests feel like family by Tony or Stefano greeting guests|
Design restaurant interior with inspirations and family photos from Sicily
|Hire and train experienced employees who embody Tony’s values and make guests feel at home.||80% of employees have >2 year restaurant experience|
100% of employees indicate they are “happy” at Tony’s and feel like “family”
100% of employees can tell Tony’s story
|Make employees Tony’s ambassadors by Tony and Stefano personally training each new hire and telling them Tony’s story|
Make employees feel like family by regularly sharing meals and activities
|Make people in the tri-state area aware of Tony’s new dining experience by implementing marketing initiatives that create interest to give the new Tony’s a try.||~5% of sales spent on marketing & local media|
30% of people in tri-state area know of Tony’s
70% of customers say they know Tony’s story
>500 facebook shares and likes per month
|Rebrand Tony’s from pizza parlor to Italian family dining by writing and telling Tony’s family story|
Get the word out by creating a facebook page and designing a social media marketing campaign
Encourage guests to share their Tony’s experience on facebook by creating little offers and fun prizes
Creating an action plan
Jen, as usual dotting the i’s and crossing the t’s, remarked, “we are not done yet! The initiatives don’t have timelines and caretakers yet. Don’t think for a minute that I will do all this alone, boys! We are in this together and I don’t want this plan to land in the drawer. Let’s make sure we all share some of the actions.”
Before Brian could say anything, Jen shot him a serious if playful look. “Yes, I know you are part-time, Brian. But you are part of the team…”, Jen paused glancing at their strategic plan, “…part of the family.”
Tony chimed in, “I agree, Jen. We will only be able to pull this off, if we do this together. Are you guys in?”
Stefano smiled, got up and walked over to Brian. Giving him a big Italian family hug he exclaimed, “Familia!”
Brian laughed, gasping for air. “Yes, yes, ok, ok. I’m in. Just let me get some air, please!” Brian reviewed the measures. “I can take care of the marketing and social media part.”
So they finalized their plan by filling in the OGSM and including caretakers and discussing a timeline to realize their plan. In less than a year they wanted to be operating under their new name and brand. And within three years “Tony’s Italian” was to become a staple in the tri-state area.
“There!” Tony was proud. “We have taken the first step to turning Tony’s Pizza into Tony’s Italian family restaurant. This is exciting! I cannot wait to get started.”
Before they closed their meeting, they agreed to review progress on their plan every second Monday of the month when Tony usually invited all employees to a large family lunch.
Jen printed two copies of the OGSM and hung one in their little office and one into the kitchen of their restaurant. If they were to be successful with their plan, she wanted it to be present and visible to everyone at all times.
She looked at the large print on the wall. “That was a hard piece of work,” she murmured more to herself, “and the work has only just begun.”
Where to go from here?
Click here to download Tony’s example OGSM as PDF document. Or click here to browse our jam-packed resource page with other free examples, tools & templates and workshop materials to help you get started with your own strategy process.
Click here to learn how to use an OGSM template to simplify your business strategy.
Read about the top 13 reasons why successful companies deploy the OGSM methodology or how to avoid the 7 deadly sins of business strategy.
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