Tuesday, February 28, 2012

SMART v. 2.0, Aggressive Goals

This blog looks at another “A-word” to fill out the SMART recipe in which the other letters are Specific, Measurable, Relevant, Time-Bound.

Last time we looked at “Attainable" goals as an “A” option.  While there are some good reasons to use “Attainable” goals, I pointed out that one important finding from the goal research is:

The more difficult the goal, the higher the level of performance.*

To leverage this finding, my friend Doug Smith uses “Aggressive, yet Achievable” as the “A” for SMART in his excellent book, Make Success Measurable.  The more difficult a goal is set, the more persistent and creative people will be.  They will work harder and perform better.  These are the reasons for setting “Aggressive” goals versus easier “Attainable” goals.

If you are setting goals for yourself, then you will improve your performance by using the Aggressive SMART formula versus the Attainable approach.   The exceptions are if you want to want to build some momentum with some “easy wins,” or if you are setting Learning Goals where you are in new territory, or if you are concerned about getting discouraged.  But if none of these circumstances apply, then set Aggressive goals and watch your performance improve.

However, if you are a boss and you want to implement Aggressive goals for your team then you need to do so carefully.  The first thing you need to look at is your reward system.  Do you punish failure?  If so, then you can expect lots of push back on Aggressive goals.  People will want goals that are easier so they are not punished for failure.

What should you do?  I suggest that you change your reward system to reward performance instead of success.  What’s the difference?

Rewarding for performance starts with setting outcomes for your direct reports.  See my earlier blog about this for more details.  Then you can reward them for their actual performance rather than if they meet a particular goal.

Here’s a quick example.  One of the easiest areas to set outcomes for in the nonprofit world is fundraising – the outcome you want to reward is “dollars raised.”  Many nonprofits use a reward system based on “did you meet your goals for the year?”  By doing that, people are motivated to set an Attainable goal.  They will set a goal that they are sure they can meet so they get rewarded.

If you change your focus to rewarding the outcome, then at the end of the year you ask “how much money did you raise?” and you reward the actual performance.   This gives people freedom to set Aggressive goals.  In fact, if they understand that Aggressive goals will improve their performance, then they will be motivated to set Aggressive goals.  Again, this only holds if they are rewarded for performance and not punished for failing to meet their goals.

As the boss, you have to ask yourself what you really want.  Do you want your team to set a goal of improving your $100,000 annual fund by an Attainable 5% and having them produce the $105,000 successfully?  Or would you rather give them the freedom to set an Aggressive goal of a 15% improvement and then having them produce a result of $112,000 that does not meet the goal?  The answer is obvious, but you – as the boss – need to shift your thinking and change your reward system to allow for this.

The two SMART formulas we have looked at, Attainable and Aggressive goals, each have their role depending on the situation.  If you want results that are highly predictable, use the Attainable goal formula.  If you want high performance, then use Aggressive goals.  But what if you want innovation and breakthrough performance?  That’s the formula we’ll look at next time.

*Locke, E. A. & Latham, G. P.  A Theory of Goal Setting & Task Performance.  Englewood Cliffs, NJ:  Prentice Hall, 1990.

Thursday, February 16, 2012

SMART v. 1.0, Attainable Goals

There are more than one hundred different versions of the popular SMART Goal formula.  I am going to compare three versions in this blog and the next two blogs.  The three versions I will review all have the same words for SMRT that I explained in the last blog:  Specific, Measurable, Relevant, Time-Bound.  The difference in the three versions we’ll look at is the “A” word.

One of the very popular SMART versions uses the word “Attainable” for the A.  And many people who teach this version will coach others not to set a goal unless they think it is at least 80% “Attainable.”  The reasoning is that you don’t want to set a goal and then fail at it.  This seems reasonable enough since we can all think of times when we – or others – experienced significant negative consequences from failing to achieve a goal.  Therefore, setting goals which are relatively easily Attainable seems to be a SMART thing to do.

Except for one thing.  The goal research does not support this.  The research clearly demonstrates that:

The more difficult the goal, the higher the level of performance.*

Hmmmm.  So, if we set a relatively easy “Attainable” goal then our chances of not failing are higher – but our overall level of performance may be lower.  What to do?

Some would say, keep the goal relatively low.  The consequences of failing are too risky.  Therefore, try to convince your boss that your easy goals are really hard so you can succeed and look good.  (This goes on every year in organizations around the globe!)

Okay – that’s a little cynical.  The desire to avoid punishment for failing at a goal is understandable.  But there are a number of good reasons for setting Attainable goals that are relatively easy.  One is to build momentum.  It can be nice to get some “quick wins” on a new project.  Another is if you are setting Learning Goals in a new domain where it is difficult to judge what is easy and what is hard.  Finally, let’s face it, some of us deal with setbacks better than others.  If you are setting goals with a team and you think they lack some confidence, then maybe setting some easier goals for a while is the way to go.

Still, we have to come back to the research – more difficult goals result in higher levels of performance.  Next time we’ll look at SMART v. 2.0 which is designed to leverage that research finding.  Stay tuned.

*Locke, E. A. & Latham, G. P.  A Theory of Goal Setting & Task Performance.  Englewood Cliffs, NJ:  Prentice Hall, 1990.

Tuesday, February 7, 2012

Use the SMRT Goal Formula

No, it’s not a typo.  We’ll get to the “A” in SMART goals next time.  But for today we will focus on the SMRT part.  In order for your goals to be more effective, they should be:

Specific & Measurable.  Vague goals are less effective than specific, measurable goals because they do not provide focus.  You need to set a goal in a way that you can be absolutely sure if it has been accomplished or not.  You know that a goal is fully specific and measurable when there can be no objective argument over whether it has been achieved.  You don’t want to rely on opinions of various people about whether or not the goal has been met.  This is another important finding from the goal research:*

The more specific the goals, the more explicitly performance is regulated.

It is simple common sense, backed up by research.  If you set a vague goal, e.g., “Do your best,” then people will interpret effort in a variety of ways.  If the goal is specific, e.g., “Raise $20,000 from the phonothons by Friday,” then people will expend more intense and persistent effort to meet the goal.*

Relevant.  What goals can you set which will catapult you toward the future you want to create for your organization and/or for yourself?  Make setting the most relevant goals a priority.  Don’t waste time on trivial goals.

Time-Bound.  Every goal should have a date attached to it by when it should be accomplished.  Simply make sure that you add the phrase “by Month, Date, Year” to every goal you set.

We’ll fill out the complete SMART goal formula with a blog about the “A” next time.  But for now, make your goals SMRT and they’ll be ready to be completely SMART soon!

*Locke, E. A. & Latham, G. P.  A Theory of Goal Setting & Task Performance.  Englewood Cliffs, NJ:  Prentice Hall, 1990.