You may have heard of “big hairy audacious goals” that are supposed to light a fire under your team and produce miracles.
If failed, these stretch goals become chained weights on the self confidence of your team. They demotivate and cause hefty stress. However, if successful, profits will soar and your team will take greater pride in their work. The potential return on investment is huge.
The name of the game is risk. Not the military conquest board game, but the idea of going big or going home.
Stretch goals can seem daunting and overbearing. If made too ambitious, they are impossible. If made too easy, they’re meaningless.
There is a careful balance required to create stretch goals that will motivate your team and propel your business.
Table of Contents
The good of stretch goals
Stretch goals inspire you to dream big and reach new heights. You can take risks and come out with new business processes, profitable verticals, or greater customer satisfaction. The possibilities are endless because the goal is to break out of your comfort zone.
DaVita, an already very successful company in the health industry, was able to go from $60 million to $80 million in savings within four years by creating such a stretch goal. You can break limits and defy seemingly impenetrable borders.
Already successful companies with uncommitted resources are recommended to set stretch goals. Employees have high morale and are excited to accomplish more.
Motivation is key for stretch goals because they are naturally daunting. They are also often costly. They will require more people, time and effort than a regular goal would.
You can’t keep putting in the same investment and expect a magically larger return. Having uncommitted resources means you’re ready to put your money where your mouth is.
The bad of stretch goals
As with all goals, you are not guaranteed success. If your team does not reach the goal, they are more likely to become heavily demotivated, fixated on unhealthy risks, and prone to lying about their actual results.
In 2013, Wells Fargo set a big hairy audacious stretch goal that backfired as stressed out sales representatives opened 3.5 million fraudulent accounts. Such unethical behavior due to stretch goals isn’t uncommon according to the Harvard Business Review.
As mentioned above, if you’re not riding recent success and don’t have uncommitted resources, stretch goals may not be for you. Your employees don’t have high morale. They will struggle when you tell them that you’re going to accomplish an even bigger goal, after having just failed to meet a smaller one.
Without the extra resources to accomplish it, the desired results just aren’t feasible. If you have one factor, but not the other, a stretch goal is still risky. Your uncommitted resources could probably be put to better use until your company has better morale.
If they have high morale, but you don’t have the resources, then ride off of that morale until the resources accumulate. Don’t push your business in ways it isn’t ready for.
How to set good stretch goals
You’re motivated to create a stretch goal. Now, how do you create that goal and share your motivation? There are five crucial steps to follow:
1. Evaluate the past
Before setting any goal, deep reflection is required.
What are the current strengths and weaknesses of your company or team? How have they responded to goals in the past? What motivates them? What demotivates them?
This is an important moment to decide how you will carry out your plan. Stretch goals will only work for you with the correct types and amounts of motivation.
So what does your team need to succeed?
2. Focus on the why
If you’re setting a stretch goal, you obviously have a reason for doing so. What is the expected outcome? What is the motivation for achieving that outcome? Make these answers clear to your employees.
If they understand the overarching vision, they will be more inspired to contribute their efforts. It’s the difference between the feeling of doing busy work and the drive of accomplishing a mission.
Create a poster that they can see every day and remember what they’re striving for. Revisit this often with your team to continually spur motivation.
Take a moment to make sure that your goal is aligned with your overarching goals. Sometimes we can get caught up in a great idea, but it doesn’t actually directly impact our high goals.
Pay attention to your company’s mission and vision. If your company needs more awareness or sales, this stretch goal should directly contribute to that.
3. To achieve stretch goals, set SMART goals
For those unfamiliar with SMART goals, it is an acronym for Specific Measurable Achievable Realistic Timebound goals. By focusing on these features during goal-setting, you can make sure that your goals are clear and reasonable.
This is important not only for you as a manager, but for your employees. Even though stretch goals ask you to venture into the unknown to accomplish unprecedented success, they can be combined with SMART goals to make them more achievable.
An example of a SMART goal versus a stretch goal might look like the following:
Susan will read the seventh Harry Potter book by the end of this month
To contrast that with a stretch goal, a stretch goal might look like this:
Susan will read the whole Harry Potter series
A stretch goal can sound unreasonable until it has structure to it. By using the qualities of a SMART goal, a stretch goal can become much likely to be accomplished. For example:
Susan will read one Harry Potter book a month, until she has completed the series by the end of this year
With some easy additions to the goal, we have set a clear course for Susan to reach her stretch goal.
Setting a course with deadlines and holding specific individuals or teams accountable is what makes a stretch goal SMART.
4. Do something novel
You’ll never hit a stretch goal by doing the same work you did before. Increased effort is certainly helpful, but perhaps there are new ways to solve problems. Work smarter, not harder.
You can start by interviewing employees and current clients to find common pain points. As you gather information, look for ways to increase productivity, effectiveness, and management.
You may need to diagram, track and improves processes. You might start A/B testing your website or email outreach for conversion rate optimization (CRO). Perhaps your company needs a sales rewards program or some other form of motivation.
The possibilities are close to endless. You’ll need some creative problem solvers combined with revealing analytics to find new avenues for success.
Just don’t make any risky changes without the research to back it up. What sounds cool to you might not sound cool to a diverse population of millions. Just remember how Pepsi failed with its ad featuring Kendall Jenner. The amount of money they spent on that single ad shows how much of a success they expected it to be. Unfortunately for them, the response was severely negative.
Again, vet your ideas with analytics and studies. Great ideas are born out of hard work and effort. This means that many of your initial ideas may need to be tweaked before they are ready to be accomplished.
Likewise, if team members have ideas that you initially would like to dismiss, maybe you should take the time to see if they are really worth something.
5. Ride the success
To ride the success of reaching your stretch goals, you’ll first need to tell your team and company. Show how proud you are!
If there is a lot to show off from each team member, you can try putting it all into a collage maker. This form of commemoration will help inspire them towards continued success. Then, continue to make goals. If you’re not moving forward, you’re slipping backward.
And if they fail
Stretch goals lead to both failure and success. You cannot be guaranteed success every time you set a goal. But the purpose of goals is to give us a new sense of purpose and direction. They inspire us to achieve more than in the past. Stretch goals challenge us to exit our comfort zones and find new areas for profitability. If met with failure, rally the troops and evaluate what went both wrong and right. Learn from the mistakes. Move forward and march on towards new success. As a leader, your goal is always motivation.
Best of luck in creating goals and motivating your team to accomplish them!
Remember that there is no silver bullet for every problem. Find the right path for your company or team and own it.
With the right mix of ingredients, stretch goals will be in your reach with success soon to follow.
Featured photo credit: Pascal Swier via unsplash.com
|||^||Jim Collins: BHAG – Big Hairy Audacious Goal|
|||^||Meaningful HQ: Smarter Faster Better, Part II: Stretch Goals + Smart Goals = Success (Stretch + Smart Goals Examples Included)|
|||^||Harvard Business Review: The Stretch Goal Paradox|
|||^||UpperCase: Stretch Goals: Motivating, Inspiring, and Wildly Misused|
|||^||Harvard Business Review: Ethical Breakdowns|
|||^||TIME: Why the Kendall Jenner Pepsi Ad Was Such a Glaring Misstep|