“Goals are dreams with deadlines.” – Anonymous
Entrepreneurs talk about goals all of the time. Typically the context is focused on goal outcomes or how “we are crushing our goals!”. But what went into setting those goals? The reality is Goal Planning and how to do it well are often underdiscussed.
While it seems simple and straightforward, setting smart, actionable, and measurable goals can actually be a fairly difficult task. Compass East recently went through our year-end goal-setting process for 2023. This process has evolved several times and continues to evolve each year as we learn more.
Internally, we’ve drawn inspiration and pieces from a number of different resources and methodologies. Last year, our management team self-implemented EOS Traction which serves as the overall operating process and the base of our weekly, quarterly, and yearly cadence. At the same time, we have also incorporated elements from other planning methodologies like SMART Goals (Specific, Measurable, Achievable, Measurable, Time-Bound), Rockefeller Habits, and OKRs (Objectives and Key Results).
This article is not to argue which is best. We believe getting started using something is better than nothing. And use what works for you. But there are common themes in kicking off a goal-planning process. Here are some takeaways from our experience.
Set Goals from the Bottom Up
One of the fastest ways to demoralize a team is to run your organization like a Dictatorship. While your Management Team is likely the most experienced or knowledgeable, they are typically removed from day-to-day interactions with clients and customers. Telling your employees what their goals are without feedback or consideration for what they’re experiencing on the ground will not deliver the most effective results.
Instead, empower your team to build their own goals that match the overall company objectives and plan. You will get better results when those on the front lines can take ownership of their own path. The most powerful way to set goals and generate new ideas is to empower your employees to build them. By setting goals from the “bottom-up” we empower our team to align their individual goals with annual team goals. This fosters engagement and innovation in how the individual can better support the organization in achieving its objectives.
Use Cascading Goals to Create Alignment
The alignment of individual goals and team goals is crucial. Management starts by setting organizational objectives. Then we encourage our team to set individual goals that align with the larger vision.
For example, if increasing profitability per client is a team goal, it might require sales and marketing to focus their targets on larger clients at higher price points. It means customer success must drive incremental revenue through upsells. Operations will need to drive efficiencies across their process. And HR needs to hire the right people that can execute. It takes a village to come together and move closer to a team goal. Empower and enable your people within their own departments and roles to identify ways they can all contribute and pull in the same direction.
Remove all Doubt
To eliminate ambiguity in the process, you must remove the guessing game. There should be no grey area on whether or not you achieved a goal by the end of a period. Utilizing the methodology behind OKRs, we structure goals with an Objective and Key Results. The Objective is the result or outcome, while the key results are the quantifiable action items necessary to achieve the Objective. By definition when all Key Results are completed, the Objective is achieved. This is a requirement to ensure that this is no ambiguity in the goal achievement review.
Build Goals Around Your Core Values
Core Values are not just meant for a poster to hang in the office. They should be at the heart of your company. This includes goal setting. Your core values should align with the long and short-term goals you set for your team. At Compass East we consistently preach our core values of being Proactive, Accountable, and Approachable. They are what differentiates us in the marketplace from other accounting firms.
Proactive – Our goal-setting cycle is inherently proactive. It allows us to stop, think, and consistently reset to understand what needs to be improved upon.
Accountability – The goal-setting process forces Accountability. We are committed to set goals with outcomes that are specific, measurable, and time-bound.
Approachable – When goals are objective and agreed upon by all parties, it removes the subjectivity of employee performance. This allows our Managers to be objective and transparent with their feedback to coach employees, not criticize them.
Less is More
“The difference between successful people and really successful people is really successful people say no to almost everything.” – Warren Buffett
There are only so many hours in a day, week, or quarter so when setting goals, identifying and focusing on the most impactful is incredibly important. Focus on the handful of initiatives that can make a real difference in the period at hand – and defer less urgent ones. In our experience, if an objective is well framed, 3-5 key results or steps are all that is needed to accomplish it. If you need to identify 15 different steps that need to happen in order to complete an objective, you need to reframe the goal. Doing too much will lead to certain failures in achievement, which will then lead to stress and disengagement in the process.
Perfection is your Enemy
For specific goals, you must remain flexible. Sometimes the steps needed to achieve your goal do not show themselves until you are in the middle of your goal cycle. If this happens, it’s okay to update the objectives. Or even drop them and create new ones. Don’t try to be perfect. Try to be better.
And for the overall process, stay patient and resolute. We promise you will fail at this. You will not be perfect. This is trial and error. But if you stick to good principles and align with your core values, you will get better each cycle you complete. It may be 2-3 or it maybe 7-8 cycles to fully embrace the system. Regardless if you seek to improve each time, you will stay on the right track.
Setting goals is hard. It takes time and requires persistence and consistency. One of the most exciting parts of this process however is looking backward over the course of a year after completing the goal-setting process a few times. It’s truly amazing watching a team focus on getting 1% better every day and holding each other accountable. Our team is certainly wired that way. And, it only gets us more excited for the future.
Books to Read and People to Call:
Measure What Matters – John Doer
EOS Traction – Gino, Wickman, Coach/Implementer – Cuvo Group
Scaling Up – Verne Harnish, Coach – Petra Coach