The Top Mistake Leaders Make When Setting Organizational Goals
Although establishing organizational goals seems intuitive — perhaps even the first step in outlining a comprehensive business plan — simply setting such goals does little to ensure that they will come to fruition. Business leaders must dig deeper to ask themselves Are these goals clear? Is progress toward them quantifiable? Are they memorable? Are they meaningful to all members of the organization?
The answer that we hear most frequently from employees is a resounding “no.” In fact, only 16% of employees surveyed in the Partners In Leadership Culture Advantage Index strongly agree that individuals in their organization are clear on the top key results for the year.
So what’s the number one mistake leaders make when setting organizational goals? Trying to accomplish too much, too quickly. There’s a reason phone numbers are structured in chunks separated by dashes — our brains are best equipped to remember groups of three or four. When leaders roll out seven, 15, and 20-plus organizational goals, everyone from frontline employees to C-suite executives lose track of them — and fast. Leaders’ meaningful attempts to get the company “on track” often flounder because no one has a clear vision on the direction they want to be heading.
From 40 to Four: A Case Study on Simplifying Organizational Goals
When Brinker International — the restaurant group behind popular dining chains including Chili’s and Maggiano’s — found themselves experiencing a steady, sharp downturn, they knew it was time for a shift in strategy. Suffering an all-time low of $3.38 a share, employee engagement rates under 50%, and turnover rates rising 110% annually, inaction was not an option.
Brinker’s company culture was riddled with finger-pointing at every level — no one was taking accountability. Instead, employees blamed others and adopted a general attitude of, “It’s not my problem.” This created a toxic work environment that brought productivity to a standstill.
Leaders gathered to discuss the best course of action and it quickly became apparent — not one of them could identify all of the company’s 40 organizational goals. If the executive team wasn’t readily aware of the company’s target results, how could they expect their employees to be? And how could they expect them to take ownership over what they didn’t know?
In an attempt to tackle everything, Brinker International was accomplishing nearly nothing. Employees needed clearly defined Key Results — and they needed a whole lot fewer of them. Leaders reevaluated their lengthy list of organizational goals, whittling it down from 40 to just four meaningful, measurable, and memorable targets. They chose to focus on lifting profits, sales, the Guest Experience Measurement (GEM) score, and employee engagement and turnover rates by set numbers.
Their plan worked. Now that employees knew exactly what they were accountable for, they took ownership over the tasks at hand. The results speak for themselves — Brinker International’s share price increased 10-fold, they saw a doubling of same-store sales, a new, highly reputable GEM score, an industry-leading employee engagement rate, and a reduced rate of employee turnover.
Why Organizational Goals Matter
According to a study from the London Business School, two-thirds of senior managers can’t name their firms’ top priorities. This puts their businesses’ success directly in jeopardy.
To remedy the issue, leaders begin by developing clear, concise Key Results. Imagine trying to plan an event, but you don’t know when or where it is or even who it’s for. You can start trying to build a guest list and review catering menus, but without any clear objectives, your efforts are aimless and success is out of reach.
This analogy is transferable to the corporate world. Employees can only be held accountable for results once company-wide goals have been clearly defined. When employees truly understand these organizational goals and the role they play in attaining them, engagement levels soar.
The Partners In Leadership Culture Advantage Index confirms: accountable employees are engaged employees and, as a result, are more likely to take effective action, facilitating higher levels of achievement toward business results.
The true value of a highly engaged workforce is something many leaders forget, and it shows. The great majority of the U.S workforce is disengaged at work and half of all employees are actively looking for a new job or watching for new job openings. On the whole, disengaged employees cost U.S. organizations around $450-550 billion per year. It’s time for leaders to identify specific results and set their companies up for success.
Focusing on Organizational Goals
Organizational goals are a must-have, but if they’re not implemented effectively, they’re about as good as sunglasses on a cloudy day. To truly reap the benefits of goal-setting, leaders must ensure their company’s Key Results are meaningful, memorable, and measurable. Those who try to bite off more than they (or anyone else) can chew, launching a list of organizational goals in the double digits, typically end up doing exactly the opposite.
Employees with a keen understanding of their company’s three to five Key Results are equipped to dig deep and outperform their competition. They know what’s expected of them and why their work matters, and they’re more engaged because of it. Companies are poised for greatness when they shed the complex in favor of the simple.
Perhaps the late Steve Jobs says it best: “That’s been one of my mantras — focus and simplicity. Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it’s worth it in the end because once you get there, you can move mountains.”