The Problem With Goals
You gotta get a plan, man

Over on the "Fist Full of Talent" website, a resource for those on the recruiting side of HR, there has been an ongoing discussion about the value of setting goals vs. the importance of creating and following plans. It seems a little circular to me - you need both, don't you? - but in these difficult times, actual, tangible plans go a long way to calm the Reptilian brain in all of us.

Which brings me to an interesting tale of contrasts.
Which "G" would you rather be?

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IN THE EARLY years of this decade, General Motors had a goal, and it was 29. Determined to boost its flagging profits and reverse a long, steady fall from postwar dominance, the automotive giant did the natural thing: it set a goal. The company pledged to recapture 29 percent of the American market, the share it had ebbed past in 1999. The number 29 became a corporate mantra, and some GM executives took to wearing lapel pins with the number emblazoned on them.

It didn't work. GM never did regain 29 percent of the market, and today, facing the possibility of bankruptcy, it looks even less likely to do so. The lapel pins are gone, and that number isn't much heard from the company.

GE, meanwhile, had goals, too. But they invested vast amounts of money during the last 20 years on programs such as LeanSixSigma and High Performance Organizations that tied goals to specific plans. The goal was the start of the process, not the end. Instead of goals taking the place of independent thinking and initiative, as seemed to happen at GM, goals were meant to spur those qualities.

In short, as one "Fist" debater pointed out:
"Goals gave us GE and Southwest, but they also gave us GM and Enron."

While we don't want to discourage people from setting reasonable and broad goals, the research is showing clearly that the more narrowly focused the goal, the more apt people are to stretch the truth and, quite frankly, cheat to reach the goal.

In a recent paper, "Goals Gone Wild," researchers Maurice Schweitzer of Penn and Lisa Ordonez of the University of Arizona looked at the cheating issue and broadens it.

They recount the hostile, dysfunctional, and ultimately criminal atmosphere created at Enron by its practice of rewarding executives based on meeting specific revenue targets. They describe how Sears, Roebuck and Co. started setting sales goals for its auto repair staff in the early 1990s, only to find out that its mechanics were overcharging customers and making unnecessary repairs to hit their numbers.

Narrow corporate goals can keep employees from asking important questions that they otherwise might.

Take the notoriously combustible Ford Pinto. In the late 1960s, Ford CEO Lee Iacocca, determined to take back the market share the company was losing to smaller imports, announced a crash program to create a new car that would be under 2,000 pounds, under $2,000, and would go on sale in 1970. Desperate to meet the conditions and the deadline, company executives ignored and then played down questions about the safety of the car's design. As a result, the Pinto, with a fuel tank just behind the rear axle, was uniquely prone to igniting upon impact, and 53 people died in such fires.

Other work suggests that goals with rewards, if not carefully calibrated, can short-circuit our intrinsic enthusiasm for a task - or even interrupt our learning process. Barry Schwartz, a social psychologist at Swarthmore College who has studied decision making, found that subjects paid money to complete a slightly confusing task were significantly worse at figuring out the rules, even after completing it, than those who had received no reward.

The research underscores some of the new "common sense" we've been pointing to at RapidChange. Goals are the start of a process that moves to an operating plan, a continuous improvement model and a strong link to values. When the "goal" becomes the beginning and the end, our attention can be led dangerously astray.

I'll leave you with this familiar story: In a famous 1999 study by the psychologists Daniel Simons and Christopher Chabris, subjects watching a video clip were told to count the number of times people in a group pass a basketball among themselves. Most concentrate so hard on the goal that they become blind to other information, utterly failing to notice when a woman in a gorilla suit walks through the middle of the group.