Goal setting – dreams, wishes and being SMART.
Goals. We all have them. Personal goals, business goals, life goals, career goals, whatever.
Unless you are the Scotland football team, goals are our bread and butter. We all have an idea of what a goal is. We all have ideas around how goals are set and agreed.
Indeed, there are many recognised methods for setting goals, as purveyed by consulting firms, life coaches, health gurus and other credible sources, and often we are stuck for choice.
So, with this target rich environment being offered up, why is it that we still see goals being transmitted to employees, customers and shareholders that are actually confusing, vague, never ending, disconnected, and owned by nobody in particular?
Here are a few howlers that I have seen recently – well intentioned, but still howlers:
- Class leading quality
- A winning team
- Employee Engagement
- Best in class
- World Class Sustainability
- Ensure that LSS programme delivers $15 million in identified savings
Do any of these strike a chord? And what do they ALL have in common?
Yes, NONE of them can be described as a goal. Not even close.
And yet here they are, up in big lights, with people invested in their delivery. Sometimes rewarded for their delivery.
Achieving goals like these is like grabbing a greased eel or weighing smoke.
I remember when I was starting out in consulting having left Nissan, we had a big client in the form of BTR (British Tyre and Rubber) a huge multinational business and FTSE 100 player at the time. They used to have a saying in relation to stretch goals that really resonated with me for some reason:
‘a stretch goal is something that you can touch, but not grasp’
Goal setting is one of the most powerful business techniques a leader can have at their disposal. Get this wrong and you can crash and burn at worst, or really demotivate your people at best. Setting goals that lack substance, mean nothing, that are ridiculously ambitious, or wholly unachievable is a sure-fire way to ‘do the right things, wrong’.
But it need not be this way.
Management by Objectives (MBO), as coined by Peter Drucker in his 1954 book, ‘The Practice of Management’, was heralded as the next best thing in terms of organisational improvement. The joint setting of goals by management and employees was seen as an excellent way to get people moving and motivated towards aligned objectives across the organisation.
Sadly, interpretation of this silver bullet varies depending on organisation and MBO is often seen as a wholly unrealistic means to gain organisational alignment and common purpose. Like many wonder cures, opinions are divided.
The acronym SMART was coined in the November 1981 issue of Management Review by George T. Doran and brought authenticity to the goal setting process, insofar as it made it easier to understand whether a goal has been achieved. In his article, Doran referred to the A in SMART standing for ASSIGNABLE, or ‘who was going to do it’. Obviously in terms of personal goal setting with your boss, this gives over to another meaning.
Even though it is well known, taught on every business course and a feature in thousands of books, we still struggle to bring SMART to bear on the goal setting process for some reason.
Let’s explore some reasons why…
S = Specific.
Being specific in terms of a gap to be closed can be difficult for a manager, leader or team. Perhaps they do not have the data to hand to make a judgement call, therefore it is easier to speak in percentages: ‘a ten percent improvement in Quality’.
What quality? Scrap? Rework? Customer complaints? Cost of Quality?
In this example at least we know that improving quality is a desired outcome – and that’s about it.
M = Measurable.
Another tough one. If the mechanisms do not exist for us to specify exactly what the gap is between current state and desired state, we are definitely going to struggle to measure progress and get the data required to ascertain whether we have succeeded or not.
A = Attainable or Agreed?
The real joker in the pack.
The mere fact that it can mean two different things, depending on where you learnt it, is a key reason why this is a weak point.
A pushy boss can ‘bully’ me into agreeing an unachievable target. In the same way, an inexperienced team may set themselves overly ambitious goals. Perhaps even to look good.
A target which actually IS achievable, might not be agreed by our boss, who might think we are keeping something back… And guess what? sometimes we ARE under-declaring.
Who is right and who is wrong? No wonder Deming hated numerical goals!
For me, A means Achievable.
Seeing the A in SMART as meaning AGREED is just plain #Bullshido. The fact that we are sitting down and discussing and working with leadership on what we need to do this year, is agreement that, whatever comes out at the end, we’re invested.
To ensure that the goal actually IS achievable, we’re going to have to go through it a few times and test the logic. Test for authenticity.
This is an iterative process and can form the basis of catchball, a common feature in Hoshin Kanri.
Setting myself a goal of doing a four-minute mile by Christmas is not authentic…
R = Relevant.
You would wonder at this one. It might just be because I’m Scottish, but really? In a discussion about goals, if it is irrelevant, you’ll be told there and then. An irrelevant goal isn’t going to slip through the net and appear on a wall chart (or my appraisal) any time soon.
So, now that we’ve cleared that up, Relevance surely then must mean that it relevant to all other functions in the business too, and, through its achievement, we will definitely see a needle move on some performance gauge somewhere.
T = Time bound.
Reflecting back to Doran’s belief that it would be easier to see if goals had been achieved, what better way of evaluating this than by putting a date stamp on it. No more open-ended, whimsical statements. No more pipe dreams.
No more Bullshido… Or so you would think.
However, the date stamp for completion is another aspect of the goal that must be tested for authenticity and not merely aligned to a year end report, a financial year end or some other alignment of the planets.
Enormity of task is a goal achievement killer, but close on its heels is unrealistic timescales and being pressured to accept them.
So, ladies and gentlemen, that was SMART goals – a quick ‘n’ dirty view from an erstwhile victim, and basically the WHAT.
A version of the HOW that I have used, (when I have had to, Deming notwithstanding) tries to make a sense of each of these steps against the landscape of the entire organisation.
Let’s have a look. It’s basic and simple because I like basic and simple.
It works.
SPECIFIC: By this I refer to a specific ACTION applied to a THING, PHENOMENA or CONDITION
- The action is ALWAYS a verb: reduce, increase, eliminate etc.
- The thing can be scrap, complaints, employee engagement etc.
MEASURABLE: first question here is ‘do we currently have any measures in place that supports the achievement of the goal?’ An example of this would be ‘REDUCE the Cost of Poor Quality by 10%’. If we don’t measure the constituent factors that make up CoPQ, then we are onto a loser right from the start.
Once we have established that measures are indeed in place, then we can go about quantifying the gap between actual condition and desired state. This could be termed the FROM-TO Statement.
ACHIEVABLE: Very much linked to the Measurable aspect. If I’m not measuring it, how can I possibly tell if it’s Achievable? Also linked to the BY statement i.e. the date or timescale for completion.
It would be useful to inject a basic graphic at this point – so let’s…
To illustrate further, here’s a worked example:
If we look at this example, we can then bring in the other two aspects: RELEVANT and TIME BOUND.
Improving OTIF is always a good idea, providing you have tested the mechanics of this, and you are not increasing costs to do so e.g., express freight, overtime, etc.
This testing of goals against other goals and business aspects is crucial and will require cross functional awareness. Only in this way do we not set departments and even individuals against each other as they narrow-mindedly drive for their own goals.
This particular goal is time bound, with the desired ‘On Time, In Full’ state being targeted to coincide with Christmas.
Who says Santa Claus doesn’t have targets?
However, for the W. Edwards Deming followers amongst us, this total focus on goals and results, particularly of the numerical kind, can drive the wrong organisational behaviours, with people cutting corners in order to meet their goals.
Whilst the intention is cross company alignment, this is rarely the case, with functional silos setting objectives and goals for their particular slice of the company pie, to the exclusion of the bigger audience.
But what if there was a way to do both? To set meaningful, cross functional objectives AND ensure that these were owned at every level in the business.
Well, thankfully there is.
I’ll be speaking more of Hoshin Kanri soon and how line of sight management from CEO to manufacturing staff is transforming businesses the world over.
And aligns perfectly with Dr Deming’s 14 points – the relevant ones anyway.
As always, thanks for reading. All thoughts, opinions and experiences, mistakes and general wrongness are entirely mine and no offence is meant or inferred.
Comments and corrections welcomed.
But No Bullshido.
We don’t do that.
If you’d like to learn more, or discuss further, please contact us via the website links.