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Opinion: 6 ways to avoid mistake-prone goals

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Setting goals is a widely accepted intractable process for many organizations and with good reason.

The value from setting organizational, team or individual goals is potentially significant. According to Harvard Business School research, hundreds of studies worldwide substantiate the positive impact that specific, measurable goal setting has on driving behavior and improving performance.

However, equally significant is the potential for creating problems when setting goals. This aspect is rarely acknowledged in business literature or books.

Here are six goal-setting mistakes to avoid.

1. Poor execution. Failure to execute is the biggest reason goals aren’t achieved. Execution is of premium value today and too few managers are highly proficient at it. You can avoid the biggest execution mistakes if you use a good execution process, communicate the plan to everyone and get your workforce engaged in the implementation.

2. Lack of strategy. A strategy explains how we plan to achieve our goal. One analogy is that strategy is like the root of a tree and branches are the goals. Both are necessary to produce results.

A few years ago, a client wanted to increase sales across 60 locations by 15 percent in six months, an aggressive task that didn’t come with a strategy. Once the leaders created a solid strategy, along with having clear goals and engaging employees to support the plan, the company actually surpassed the goal. Relying on hope is not a strategy.

3. Narrow thinking. Narrowing the company’s focus too tightly can have a negative impact on other performance areas. For example, a manufacturer set an incentivized production goal but overlooked the effects it might have on quality control. Months later, they were producing a record number of units but at the expense of creating a slew of new customer complaints. Don’t overlook other needs when you focus on your main priorities or goals.

4. Conflicting goals. Here’s an example: Blake was a star sales performer, a real rainmaker for his company. Then his department’s new goal ruined his motivation. When his vice president set a goal that incentivized average performers with enticing bonuses, it also worked to penalize Blake’s income. He eventually left to work for a competitor. To prevent conflicting goals, it’s wise to get employee feedback before rolling it out officially.

5. Too many goals. Pursuing more than four or five major organizational goals in one year is counterproductive. It’s not impossible to do, but in my experience rarely does an organization have the required time, money or people resources to pursue each priority successfully.

6. Distorted risk preferences. I remember seeing the CEO of a family-owned business set a long-term stretch goal for sales. As the deadline neared and the company’s sales paced below his milestones, he decided that a better course to achieve the number should involve acquisitions. However, his company had no experience with acquisitions, nor was it being guided with sound marketing data. He was unwittingly guided by the belief that a company is only as big as it decides to be. If you set a lofty goal, do it with caution because it can waste resources and create undue risk. As Winston Churchill said, “Facts are better than dreams.”

Effective goal setting can significantly catapult your efforts and results, but go into it prepared to avoid the potential problems.

Consultant and professional speaker Mark Holmes is president of Springfield-based Consultant Board Inc. and SalesRevenueCoach.com. He’s also the author of “The Five Rules of Megavalue Selling.” He can be reached at mark@salesrevenuecoach.com.

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