Up? Down? Growing? Stagnate? We've all learned by now that predicting economic growth is, for the present, a mug's game.
Strangely enough, in my experience, so long as the task is addressed the right way, the economic cycle rarely makes any real difference in setting realistic goals. The core principles remain the same:
1. Hire people who have a track record in achieving their goals. Like so many keys to achieving Predictable Success, setting and achieving goals consistently starts with world-class hiring.
And yet, I rarely hear business leaders address the issue of hiring when they discuss goal-setting - despite the fact that you'll only begin to consistently achieve your goals if and when you hire people who have a demonstrated track record of doing just that.
Take a look at your hiring practices. Are you hiring for goal achievement? Do you ask candidates to bring evidence of goal achievement (and not just for sales positions)?
2. Set goals early, then revise the goals regularly in light of hard data on actual performance. Setting goals as a fixed line in the sand, then 'turning up the volume' over time in an attempt to somehow force your people to deliver those goals is a road to nowhere. Stubborn refusal to revise goals-- worse, a belief that revising goals is weakness, is simply airheaded.
Goals should be reviewed at least monthly and revised (up or down) in light of whatever new information you have. If you resist doing this because you fear your people will sandbag their targets knowing you'll be open to revision later on, then go back to point one above - your problem is with the type of people you've hired, not with the data.
3. Use data for 70 percent of the goal-setting process, intuition/judgment 30 percent. You need data more than you think. Learn what your industry trends are, poll colleagues and peers for their experiences. Ask your managers and your team members for their input. Goal-setting done in a vacuum--with just you, a spreadsheet and a magic eight ball--isn’t going to cut it in this economy (or in any economy, but you’ll feel way dumber doing it in the present uncertain climate).
But also remember, your team members need your judgment more than you think. That’s what you’re there for - to use your expertise and experience to bring some sense to all that data and reach attainable conclusions. That’s why you get the big bucks. So learn to trust your judgment, and be comfortable knowing that data can only provide you with a platform on which to apply that judgment.
4. Build goals from the bottom up, not the top down. Your people on the front line know more than anyone else in the organization about what is achievable and what isn't. If they don't, or if you think you can’t trust them, or that they’ll sandbag you, go back (again) to point one.
5. Reward success, penalize failure. Too many compensation schemes favor the first and under-play the latter. If you truly want to get good as an organization at setting and achieving goals, there must be consequences for sloppy forecasting--being over-optimistic just to please the boss is a terrible drain on an organization’s success, so put penalties in place as well as rewards.
Learn how to consistently achieve your business goals. Download a free chapter from the author's WSJ best-seller, "Predictable Success: Getting Your Organization On the Growth Track - and Keeping It There" to learn more about building a world-class culture that will rapidly accelerate the growth of your business.