My essay this week might easily be read in conjunction with last week’s In Praise of Doubt. Last week I was critical of the Absolutists and their need for certainty. In fact I implied that their lack of tolerance of ambiguity was an indication of a lack of psychological maturity.

The thought came to me again this week when dealing with a client having a difficult time at work. After our discussions I sent him some material to ponder. Included in it was a quotation by the great Taoist sage Lao Tzu. Lao Tzu reputedly said, “A good traveller has no fixed plans and is not intent on arriving.”

 

Most of us would find such advice at best enigmatic, at worst incomprehensible.

 

Certainly, in an organisational context it is an anathema!

 

Along with the imperative of strategic planning, most executives are taught the imperative of goal setting. In their admirable book, Built To Last, Collins and Porras advocated the setting of Big Hairy Audacious Goals (BHAGs). This theme was also taken up by that other doyen of American organisational excellence, Tom Peters. Some years ago, I went to a seminar that he delivered extolling the virtue of such an approach.

 

Peters cooled somewhat on the idea of BHAGs coming to the conclusion that “instead of being excited and motivated by the BHAG, team members are often confused and disillusioned.”

 

It is to me, at best, a simplistic idea to believe that all an organisation has to do is to set a lofty goal designed to stretch the organisation’s capability and it will sail on to greatness.

 

Michelangelo said, “The greatest danger for most of us is not that our aim is too high and we miss it, but that our aim is too low and we reach it.” But in organisations the danger is that we set goals that are unattainable or that our employees can’t connect with.

The “goal setting” movement seems to me to be little differentiated from the “positive thinking” movement that I talked about in my essay The Problem with Positive Thinking (21/12/2013). And of course it has the same downside. When a goal is not attained we believe it is just because we didn’t try hard enough.

I believe that goal setting is an important management discipline. Properly done it can serve to focus and energise employees. But whilst most of the management literature extolls the virtues of goal setting, I thought it would be useful to look at the harm that can often be associated with goal setting.

Sometimes the harm is done by setting inappropriate goals. Let us look for example at the infamous case of Enron. Enron executives were being lavishly rewarded with large bonuses for meeting revenue targets. By focussing on revenue rather than on profit Enron executives bankrupted the company. There are many such examples of organisations either setting the wrong goals or setting impossible time frames for reasonable goals that have resulted in disasters.

Some years ago I was associated with an organisation that had set goals in strategic planning and then subsequently set the CEO’s KPIs to align with those goals. Mid-year, due to circumstances beyond its control, the organisation was forced to undertake a major change of direction. The Board was so distracted by this they never got around to changing the CEO’s KPIs. Because of the monetary reward attached, the CEO doggedly pursued the KPIs even though they were no longer relevant in the organisation’s new circumstances!

There is no doubt that appropriate goals properly propagated can both motivate and focus employees. However, one of the dangers of goal setting is that it often focusses employees too narrowly.

Consider an organisation that is focussing on safety and using the metric of Lost Time Injury Frequency Rate (LTIFR). Statistically they might find that what results in most time off work are minor problems like dust in eyes, minor scrapes and abrasions, trips and falls and so on. If they focus on eliminating these causes of lost time they will probably have a good statistic. However they might still have a quite dangerous environment because in focussing on the causes of their most likely lost time injuries they could easily neglect attending to those hazards with the greatest likelihood of causing far more serious outcomes.

(I suppose it is more common to have organisations accused of focussing on production goals at the expense of safety and there are many examples of this as well.)

But it is fair to say that when managers set targets for specific dimensions of a problem, they often fail to anticipate the broader results of their directives. Goals inform the individual about what behaviour is valued and appropriate. The very presence of goals may lead employees to focus myopically on short term gains and to lose sight of the potential devastating long term effects on the organisation.

At the other end of the spectrum we can easily be caught by setting too many goals. Organisations can’t be focussed on doing twenty seven things at once! That is the formula for minimising achievement and maximising excuses. Good organisations are continually prioritising to ensure that the most important things get done.

The other variable that must be watched closely is the time horizon. It is often possible to achieve great short-term outcomes by compromising long-term viability. You can’t, for example, continue to maximise short-term production by delaying your maintenance. And there are many such ways to eke out more short-term results that jeopardise the organisation’s future.

However, I suppose the greatest danger occurs when people become too attached to their goals. (Remember the lessons we have learnt about in previous essays about the danger of attachment!)

Whilst it is helpful (and indeed the principal reason for goal-setting) if people get too engaged with their goals a number of unfortunate outcomes are likely.

Firstly if we become too attached to our goal and the goal is not attained the results can be devastating. Such an outcome can leave the more vulnerable susceptible to depression and even suicide.

Secondly, if the goal assumes such importance we can be tempted to do illegal and immoral things to achieve it. (There are numerous cases in business to exemplify this.)

Finally, if our goal assumes such ultimate importance, we are more than likely to expose ourselves to undue risks to attain it.

In his insightful book The Antidote Oliver Burkeman relates the analysis of Chris Kayes and James Lester of a fatal attempt to conquer Mt Everest in 1996. They showed how climbers who were so obsessed with this goal pushed on despite knowing their oxygen reserves would be depleted and their likelihood of returning to the relative safety of a camp by nightfall was almost negligible, continued the ascent with fatal outcomes.

So what are the principal lessons here?

If we are going to manage enterprises well, there is no doubt they must achieve to be successful. Appropriate goal setting will most likely be one of the tools we would use to enhance that likelihood.

But if our goals are not to have other deleterious effects:

1. They can’t be so narrow to ignore their impact on other parts of the organisation;
2. They must take the long view such that we don’t succeed in the short term but compromise our long term viability;
3. They can’t be pursued by immoral or illegal means;
4. They need to be tempered to meet the risk appetite of the organisation;
5. They shouldn’t be too numerous such that organisational focus is dissipated.

Let’s however return to the quotation of Lao Tszu’s with which I started this essay. It is a problem of great concern for a person to become too outcome dependent. When I peg my sense of self and probably associate my future well-being with outcomes (eg achieving goals) I am immediately vulnerable.

To begin with many of the goals we set ourselves are beyond our compass of control.

Let’s take a simple example. Suppose I run an organisation producing a product called superwidget. I set myself a stretch target based on the record of the last five years. Unconsciously I am making a pact with myself that I will be happy if I meet this target. The corollary of course is that I will be disappointed (or worse) if the goal is not met.

But what say in the next twelve months:

1. There is a global recession such that demand for superwidgets is halved, or
2. A competitor enters the field with a new supersuperwidget that delivers more than our product does at half the price, or
3. Due to a revolution in a third world company one of the key resource inputs to our manufacturing can no longer be acquired.

All of these setbacks were not predicted and were outside our control. Should we now indulge in self-flagellation because our goal wasn’t met? Only if we are masochists.

More importantly is the erroneous assumption that we hold that our sense of well-being is dependent on the goal being met. If we are honest we will admit that although achieving a goal gave us a momentary high, the effect was short-lived. When we are outcome dependent, our lives are dominated by highs (when we achieve) and lows (when we fail and even after the high of achievement wears off).

Can you remember a goal you had set your heart on? If you met that goal how long did your exultation last? I remember myself believing that my life would be wonderfully enhanced after graduating from university. Well it was – for at least a week!

For outcome dependent people life is a series of achievements, each providing a short term high which soon wears off and inveigles them to set and achieve the next goal. Such restless, driven people provide a lot of the drive, conflict and dysfunction that I see present in our executives.

In short then, by all means use goals, but be careful how you apply them – but in no way attach your sense of self to them.

Lao Tszu was right. There can be great joy in the journey wherever it leads and it is a great mistake to equate the traveller with his destination.