For most over the last few months out lives have been turned upside-down. It’s left many businesses with more challenges than solutions and that situation is likely to continue for some time.
What do you do when the world changes so dramatically – when doing business is so different from how it was just a few months ago?
You set goals.
Now is the perfect time to do this because the FIRST thing we need to do is work out where we want to be in three, six or twelve months from now. And goals form the foundations of plans and if you’re looking to stay in business you need a plan
We can agree on the need for goals but if you set the wrong goals your business could be thrown off course so, I’ve written this article to give you an insight into how to design successful goals.
Given that your business goals will be partly driven by your marketing goals it’s no surprise to find both sets of goals intertwined. (It’s why this exercise interests me from the marketing perspective.)
'Standard' Goal Setting
Let’s take a look at a typical list of questions which draw out your goals, it might include…
- What do you want to achieve?
- What problems are you going to solve?
- What does success look like 1, 3, 5 years from now?
- What do you want to change?
- What’s your intended annual turnover
- And so on…
On the surface, there’s nothing wrong with these questions. They are all sensible, business-focused questions which would help you form your goals. However, you’ll notice that they are all in the future tense and naturally cause you to imagine some unknown point in the future when these goals will have been achieved.
Now before you think I’m going to drone on about making goals time-bound, I’m not. You already know that and it’s not what makes goal setting dangerous. Let me explain what is with an analogy.
Imagine standing on a beautiful beach, the turquoise sea is calm, and you can see all the way to the horizon where a gold-red sun is setting. As you kick back on your sun lounger you consider a simple question: How far is it to the horizon? Then you might try to imagine where half-way is or two-thirds. Halfway through your [insert your favourite cocktail here, mines a Mojito by the way] you wonder if you had a dinghy how long it would take to get to the horizon. Indeed, how would you know when you’ve got there?
Now, if you’re just using your own skills of judgement and experience how accurate do you think you’d be? You could guess but you’d probably be way off. And by ‘way off’ I mean anything from 5% to 100% depending on your luck and judgement. But it’s almost certain that your answer would not be correct. (If you’re curious, distance-wise it’s about 2.9 miles away if you’re standing at sea level at 1.7 metres from the ground. However, even if you asked me to sail 2.9 miles from the beach, I still wouldn’t have much clue when I should stop.)
We think we can do more in the time we have than we really can
Human's Are Useless At Estimates
You might now start to see the problem – humans just aren’t equipped to accurately judge distance and the same goes for time. The end of a time-bound goal is a little like the horizon and even though we know exactly how many days there are from now to then we can never map out exactly what we are going to do in each of them. It’s too complex for us to calculate and far too full of unknowns. How many times have you mapped out your day and still ended up with things left to do? Or set aside an hour for a meeting which, takes two. Or been told by a supplier it would be ready by the end of the week only to find that it was a week late? How many times have you known time to drag in some dull meeting or ‘fly’ when you’re having fun?
Thinking about your goals 12 months from today, if you were looking back, what would have had to happen for you to be happy with your results?
Worse still, your inability to judge time correctly is built into your DNA, and I mean that literally. We are all terrible judges of time because we suffer from something called temporal optimism bias. In other words, we think we can do more in the time we have than we really can. And it’s not just confined to time, our ability to judge risk and cost:benefit predictions is also often overestimated. That’s a pretty comprehensive flaw to our goal setting since we will almost always assume, we can achieve more in less time than we really can.
The effect of this is our goals become unrealistic, unachievable and self-defeating. Just imagine getting to the end of the year without hitting all your goals or hitting them but killing yourself in the process because you’ve pulled 70-hour weeks to do it. How would you feel? And how would you feel about goal setting for the next year? When you add all this up it’s one of the main reasons why people fail to achieve their ‘New Year’s resolutions both professionally and personally and then why they don’t bother for the remainder of the year until they are motivated into action by the collective need to try again at the top of the year.
So, if it’s written into our DNA to be overly optimistic when estimating time and resources, how do we set sensible, attainable goals which don’t leave us frustrated failures 365 days later?
Truthfully, you can’t. (Sorry, that not what you wanted to hear but things do get brighter from here on.) Whilst you can’t completely remove the likelihood of optimism bias from your goals, we can do a few things to help minimise the effects.
Understanding The Effects of Optimism Bias
Simply being aware of optimism bias makes it likely that you’ll be more realistic since it acts as a ‘reality filter’ when you’re setting your goals. This awareness allows you to adjust and moderate your goals as you go reminding you to be more pessimistic than you might.
Bring In Other People
Get someone else to vet your goals. The studies show that people who are impartial often supply far better estimates than those ‘invested’ in their goals.
Make sure that not too many of your goals have the same priority. I’ve seen this happen often where everything seems as important as everything else. (It’s understandable too if you’re responsible for managing everything, marketing seems just as important as sales and accounts just as important as IT.)
Unfortunately, not separating your priorities out usually causes chaos since no one knows what they should be focusing on from one day to the next. Not everything has equal priority as some things don’t contribute to your bottom line as much as others. Knowing which do can be an art but trust your instincts, you’ll most likely be right.
Ask The Ultimate Goal-Setting Question
This is my all-time favourite goal setting technique and one I often use when helping my client’s set their marketing goals.
“If you were thinking about your goals 12 months from today and you were looking back, what would have had to happen for you to be happy with your results?”
Now there are all kinds of things happening in that question which help you: You’re imagining yourself in 12 months’ time (this is called Future Pacing). So, instead of looking forward to some vague point in the future, you’re looking back from a future point back to today. You’re imagining yourself on the horizon looking back to the beach and because the beach (i.e. today) is a fixed reference point in your mind, far more than the horizon (i.e. the future), you can make the judgement about how long it might take to get there more easily.
Focus On Monthly Goals
It’s lovely to say, “let’s increase our turnover by 10% this year” but it’s perhaps easier to say, “let’s increase our turnover by 1% each month”. 30-day cycles are easier to manage since you can be more accurate with your predictions, there are fewer unknowns and you can focus on your goals with greater intensity.
The future is never certain, and the variables of business life sometimes seem to appear purely to derail our plans and whilst there’s nothing you can do to stop that at least you can combat optimism bias so you create better goals that you are more likely to achieve.
Finally, don’t feel bad about not hitting your goals, you are in good company
- The wonderful Sydney Opera House began its construction in 1959 and should have been completed by 1963. It was completed ten years later in 1973 and had an original cost estimate of around $7 million which ballooned to a whopping $102 million.
- The UK government committed to a massive IT health service project which became known as the ‘NHS Supercomputer’ and was meant to link everyone’s health records into one database. At the time of its commission in it was estimated at a sizeable £2.3 billion by 2006 that figure was revised to an eye-watering £12.4 billion and in 2007 the House of Commons Public Accounts Committee adjusted it again to a heart-stopping £20 billion. The project was eventually given the last rites in 2011 having failed to deliver anything tangible.
- Of course, we should not forget HS2 which was estimated to cost £24 billion but now has likely costs of £90 billion and the first piece of track has yet to be laid.
- Finally, few projects could have gone as catastrophically wrong as the Death Star (estimated by the White House, yes, I do mean the American one) at costing $850,000,000,000,000,000 ($850 quadrillion) which was blown-up by one bloke and a small tin-can shaped robot.
Whatever your goals are, I wish you success in achieving them. (Except ones which involve blowing up planets.)