Set Goals Like It’s The End Of The World

The end of the world—in addition to the fiscal year—is fast approaching. And while some managers are struggling to balance the books and achieve their bucket list on time, others are feeling confident about their resolutions for the New Year.

With a new budget year and second change to set goals, non-apocalyptic managers can look forward to December 22nd as a second chance.

You know what happened to Ford when they pursued Lee Iacocca’s ambitious goal for the company of building a car “under 2,000 pounds and $2,000” by 1970? Ford’s affordable model car, the Pinto, ignited in flames every time it was rear-ended.

Remember when iconic, former New York Jets quarterback Ken O’Brien rapidly improved his interception percentage? He was financial incentivized by the team to achieve this goal. The result, yes, it was fewer interceptions, but it was because O’Brien just threw fewer passes (often to the detriment of team strategy).

The New York Times was one of the first to report this phenomenon of unforeseen consequences of goal-setting in strategy.

“Besides possibly leading to unethical behavior—a lawyer being told to bill a certain number of hours a week will be tempted to fudge the numbers—too much emphasis on goals can inhibit learning and undermine intrinsic motivation,” Professor Schweitzer, co-author of “Goals Gone Wild,” told the NYT.

Professor Schweitzer’s journal article, which appeared in the Academy of Management Perspectives in 2009, doesn’t discourage incentivizing employees or throwing out the strategy manual.

The Professor merely states, “Goal-setting is like powerful medication.”

“You need to make sure how appropriate it is and keep monitoring it to determine, ‘Is this goal too specific? Is this goal too stressful? Is it pushing many people beyond the normal bounds of what they should be doing?’ If so, then you need to rethink that goal.”

For example, Sears set a productivity goal for their auto-repair staff, motivating them to collect $147 for every hour of work. Sales goals are not uncommon—the result?  Employees resorted to overcharging customers on a companywide basis simply to satisfy Sears, explains Peter Bregman in his article “Consider Not Setting Goals in 2013,” for the Harvard Business Review Blog.

The problem with the majority of year-end, company-sweeping goals is that they’re typically motivated by fear or negativity.

You didn’t like your profit margin from 2012, so you raise expectations for 2013. You poorly incentivize employees to become more productive workers, or you point out inefficiency to managers and demand change.

There’s a reason why self-fulfilling prophecies come true. You fear the end of the world, so you hastily drive to that one town in France allegedly immune and excessive highway speed causes a wreck that ends your life.

If you start setting expectations and view progress from a purely negative perspective, you may find you’re unhappy with the consequences.

So this year, stop setting hard-to-reach goals and expectations for your firm. Try, instead, a go-with-the-flow fiscal attitude and set manageable, incremental strategies.

Instead of identifying weakness in your business practice, identify your most successful corporate structures. Then, find out how you can keep these structures going, or how you can improve upon them. 

Set small targets, not in sales or billable hours, but for increasing employee satisfaction or associate mentorship programs.

If you focus on the positive, achievable (and often intangible) targets for your firm, you’ll find that you also benefit fiscally. And, you’ll never be disappointed with the results at the end of next reporting year.

Don’t worry about all-encompassing, omnipresent firm objectives. Give the Mayan’s time to take their foot out of their mouth, let the yuletide roll, enjoy your office holiday party, and worry about assembling a small, enthusiastic brainstorming group to set targets sometime in 2013.

No resolutions set for your firm this year? It’s not the end of the world.

-WB

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