Goals which use words such as maximise and minimise are a waste of time thinking about, especially if they come without a numeric indicator of what success looks like. Goal setting should motivate people to achieve a level of performance, to give them purpose in their life or at work or happily both at the same time. A goal such as: ‘minimise customer service complaints’ communicated to 200 staff at a resort or hotel leaves no-one the wiser about what has to be done. A goal of ‘reduce customer complaints requiring the intervention of the general manager to resolve from 20 per annum to less than 10 per annum’ is much more likely to create an environment where people are working on specific solutions to achieve the goal.
“The man who chases two rabbits, catches neither” (Confucius). Having too many goals is worse than having vague goals. At least with a single or, at most, a few vague goals there is a semblance of the direction we want to head in. With multiple goals, people have no idea of the goal on which to concentrate. The best people will choose one or two at their discretion and the weakest people will choose none and coast. The goal of the organisation should be like the head of a fish – always pointing the way in which we want to head. Relegate other contenders for the goal to a series of objectives to support the main goal like the ribs of a fish – to continue the analogy.
Goals which read something like: ‘To be the lowest cost manufacturer of solar powered pumps in Australia’ are too difficult for people to understand how they can influence the goal. They not only have to contend with the various departments in their organisation and how well they contribute the goal but they also have to contend with the competitors and what they do with their cost base. Outcome focus is what a vision statement is about. A goal should be performance based, for example, ‘to reduce our costs per pump manufactured by 20% this calendar year’.
Setting easy goals in life and in business is false economy. It may seem clever to set easy goals so that no-one stresses over achieving the goal. However, without the need to stretch our performance it is unlikely that we will continuously improve as much, which means as an organisation and as individuals we do not learn about our weaknesses to remedy them, nor learn from our successes how to go about accepting challenges in the future.
Whilst it is necessary to set a stretch goal in order to allow people to have a clear purpose and desire to continuously improve, doing so without ensuring people have the capability is a recipe for failure. For any stretch goal it is imperative to ensure that people have the competence through training and coaching, the authority to make decisions and the availability of data required to make decisions which support the achievement of the goal.
This should be as plain on the nose on our collective faces; setting incongruent goals spells doom as far as reaching any of them and yet we see it time and time again.
A resort with 250 employees sets a goal of improving feedback from guests from 78% positive to more than 85% positive with concurrent goals of reducing staffing ratios in the evening on the front desk from one to forty guests to one to eighty guests.
An industrial company wishes to reduce lost time injury frequency ratio from 30.3 to less than 20 and sets a concurrent goal to reduce training hours per employee from 10 per annum to 6.
Take great care to ensure that you do not set incongruent goals within your organisation.
Setting goals in isolation of other departments in an organisation or in isolation of what is happening in the external environment is just plain stupid. Sadly, it is not as rare as one might hope.
One organisation had the operations and logistics group setting consistent goals over many years of reduced costs, which over that time led to the closure of many manufacturing plants in favour of larger single plants further and further away from end customers and reductions in stock holding, especially of expensive to make specialty products. Marketing and sales, meanwhile, set goals to increase market share of specialty products in industries such as mining. The specialties supplied to mining had a very significant impact on both productivity and down time in mines. Unfortunately, every now and then mining staff forgot to order these minor volume low cost (relative to the overall costs of mining) products. The supplying company was now forced to airfreight specialty products, if they were in stock, thousands of kilometres into remote mining areas. At times the stock did not arrive in time and the mining company sat very expensive equipment idle at a cost of $100,000’s per day. The mining company soon learned to keep its own stock. The supplying company did not win the tender next time. Not only did they lose the specialty products but the commodity products as well. That particular company has lost market share and profit every year for the last ten years because goals were set in isolation and the goals which were set became incongruent.
Kodak is the last in the line of organisations determined to set goals in isolation of the external environment. They set goals for many years that ‘protected’ their existing market, ignoring signs evident in 1999 that their existing markets were declining rapidly.