How do I set goals and how do I follow up on progress? These are perhaps the two most important questions a leader can ask. The way you answer will significantly impact how successful your team can become. And, more importantly, it will be a key determinant of how people feel about themselves and their work.

In my role as Lookback's CEO I try to apply the following four principles in all my goal setting and follow-ups for the organisation. The same principles can be used, however, at any level of goal setting - you can use them for yourself,  or for a team of any size. You can use them at work, or for a private project.

  1. Set meaningful, yet attainable goals
  2. Measure progress at the right intervals
  3. Celebrate and rest when you attain a goal
  4. Don't automatically equate missing a goal with failure

Set meaningful, yet attainable goals

In 2005 I had just followed love from Sweden to Montréal and I was trying to finish my PhD thesis, working from my new home, far away from my peers and teachers and family and friends. It was very lonely and I had a really hard time motivating myself to sit down and get the work done. So I developed this system where I would write without interruption for 45 minutes, have a 15 minute break, then repeat. Nothing but work in the 45, no work whatsoever in the 15. I set the goal to get 8 of those cycles in every day. Most days I would hit this goal and then I would feel great. It energized me. It made me go to sleep with a feeling of accomplishment. And I got stuff done. A great journey into the power of structured self-deception had begun.

Setting a goal has two main purposes. The first and most intuitive purpose is to help yourself and/or your team get from where you are right now to another place. The second, and equally important purpose, is to celebrate moving forward. Reaching goals make most people feel great about themselves and each other. Missing goals makes most people feel a bit shit about themselves and (sometimes) about their team mates. Going a long time without hitting goals is one of the most toxic things there is for a team.

So, if you want the good things and you want to avoid the bad things, always strive for a high chance of success when you set goals for your team.

At the same time, your goals need to be meaningful. At Lookback we found ourselves in a situation last year, where we needed to hit a certain revenue goal, within a certain time period, in order to not run out of cash. If we had set the revenue growth goals too low, we would have increased our chances of having a goal-hitting party, but at that party, everyone would have been painfully aware that even if we kept hitting goals, it was only a matter of time before paychecks would bounce. I don't think that would have been a great party. So we set an attainable goal in a meaningful range and thanks to the dedication and hard work of the team, and some luck of course, we exceeded the goal. What a great feeling! That's how hard working people deserve to feel all the time. And as a goal setter, you play a big part in whether they will or not.

Start by figuring out what meaningful progress looks like for YOU, for the period. What this is will vary considerably depending on what kind of situation we are talking about, how you are financed, what market you are in, and so on and so forth. There are plenty of good principles for figuring out what meaningful progress is for you, but that is for another blog. Once you have understood the meaningful goal, you move on to finding the closest attainable goal range in relation to that.

For example, lets say you've figured out that for you, meaningful progress is about growing revenue. You've calculated that you need to grow MRR by at least 20K next quarter in order to sustain the business. Then +20K is your meaningful target. Now figure out what you could reasonable achieve, based on previous performance or humble projection models.

If the attainable range is lower than +20K, you should accept that. Setting the goal at +20K based on that being what you need, when the reality is that your team can only attain +10K, will not magically improve performance. This is just wishful thinking. Instead you need to accept that you will not have meaningful progress via a revenue growth strategy alone, with the current team, and you must change strategy. Perhaps you need to cut costs to give yourself a lower meaningful goal? Perhaps you need to hire more revenue generating people? Perhaps you need to raise more cash? There can be many solutions. Setting an unattainable goal, however, is not one.

If the attainable range is higher than +20K, good for you. Time to start dreaming about expansion and investment. But don't get carried away. If you set the goals too high you put your team at risk of "virtual loss". If you need to grow 20K and you end up growing 40K, but you've set a target of +60K, chances are your team will feel a virtual loss of -20K (40K-60K) when in fact they had a real win of +20K (40K-20K). That's 40K worth of unnecessary feelings of failure. Feelings of virtual loss can be devastating to moral and there really is no need for them to ever happen. They are almost always the result of bad goal setting.

Measure progress at the right intervals

Back to 2005... Although I was feeling great on the days I hit my target, I felt really bad on the days I didn't. "How bad must I be at this if I can't just sit and work for 8x45 mins in a day, I would ask myself? That's just 6 hours."  Thinking about it, I realized that some days I could easily put in 10 or 12 of these cycles, and even on bad days I could get 4 in. If my goal is 8 per day, it simply makes no sense feeling bad about a 4-cycle day if I just came off a 12-cycle day for a total of 16 cycles in two days. So I changed the measurement period to weekly instead of daily. This way, I could use good days to put extra cycles in the bank, and a bad day wouldn't make me lose sleep. This tweak not only made me accept bad days and not waste energy on being frustrated, it also taught me the valuable lesson to make the most out of flow when I had it.

Everyone has a bad day. Every team has a bad week. Every company has a bad month. That is just life. Don't fight it. There is absolutely nothing to gain from giving your team an opportunity to feel like shit just because they had a case of reality. Measure goals at intervals that BOTH allow people to smile after a challenging day AND incentivizes them to make the most of productive days.

Celebrate and rest when you attain your goal

My system was working great. I noticed that you can get A LOT of things done if you focus for 45 minutes 40 times a week. Way more things than in the classic PhD student routine of "always kinda working". But there was one problem. I was learning where I needed to be by the end of each day in order to hit my weekly goals. So if I knew I would have a doable Friday I wouldn't really push myself on a Thursday, even if I was having a good work day.  So I came up with another level to this now rather complex game of self-deception. The new deal was that I only had to hit 36  cycles in a week instead of 40 - and when I did, I could take the rest of the week off. In order to have a Friday off, there couldn't really be a bad day. But what happened was that I would get more rest and time to reflect during my three day weekend, which led to a better and more focused start each Monday, which led to a much more even and inspired performance during the week, and much better work being done in the 36 cycles than had previously been achieved in 40, which lead to more Fridays off, etc...

Be clear with the team that you only care about them hitting their goals, not about the hours they put in. You achieve this by "forcing" them to celebrate or rest when they hit goals. Some people will finish before time and then immediately start attacking a backlog or jumping into next period's targets. While this can seem like  a smart thing to do it essentially means that there is never a reward for hitting goals early, and rest is not related to how hard the team has worked. This is not the smart thing to do. If you are serious about productivity and quality, you should celebrate and rest when you achieve those things.

Don't automatically equate missing a goal with failure

Sorry, no nostalgic anecdote for this one, I learned this way later in life...

Even if you apply the above method for your goal setting, your team will miss goals. Setting goals that are both meaningful and attainable is hard and although chances of success should be as high as possible, success is rarely a given in the meaningful goal range of most companies. So the last piece of good goal setting and follow-up is about how you react to missing a goal.

Most people will intuitively and emotionally equate missing a goal with having failed. This is not the thing to do. There can be many reasons why the team wasn't able to achieve their goal. But those are not immediately known at the moment the period ends. It makes no sense whatsoever to conclude failure before we know what happened. You will learn nothing and you will feel bad doing it. So start by doing a proper debrief. What happened and why? What went well? What did not go well? What can we improve?

It may be that we failed. It may also be that things were out of our control. Perhaps the goals were unattainable after all? Before the team understands what happened, all complaints and/or excuses are un-helpful guesses at best. Figure out what happened. Don't put blame where it doesn't belong, do not make excuses where there are things to own up to. Learn. Move on.

On a final note, as I've applied these principles over the years, I've found that some people love it and others are very skeptical at first. Few skeptics keep arguing when the results are in though. And the results will come. Because no matter how we feel about it, working smarter is more important than working harder. I think we live in a culture, however, where its hard to work smarter and celebrate hitting goals and giving yourself some well earned rest. There is so much shame around taking a break or having a bad day. Too many managers guilt people for taking time off. We guilt each other about it. We feel guilt about it - or, worse, we feel shame. It makes no sense. It's simply bad leadership. We really should work smarter first. It will lead to higher productivity and it will be way more sustainable for humans. And guess what? When humans are treated right and have clear, meaningful and attainable goals, they tend to work really hard.

Hope this is helpful! Feel free to share and comment.