SMART objectives have become the norm and probably all leaders have become familiar with the acronym. There are a few things however that undermine their effectiveness some times (in an organisational context). From a desire to create specific objectives sometimes companies slip into turning them into HOW to make things instead of focusing on the WHAT. Whilst the planning is important, an objective in itself has to be about WHAT we are trying to achieve. “Reaching x turnover by end-2021” is different from „decreasing churn rate by x%” or „increasing prices by y%”.
The scope of the objective setting is to leverage organisation resources to move towards a certain destination. Each team-member and each department will play a different role. Moreover, there might be various ways of reaching that objective. When the objective becomes about the steps to be taken rather than the final destination, at least two things can go wrong:
- We will be so focused on those steps that we might fail to see other routes;
- Teams are disempowered to some degree and engagement can suffer.
What is the alternative? Make the objective inspiring and desirable and allow teams to come with proposals regarding what their contribution can be. To facilitate objective setting at team level, investigate what the current state is, what needs to change („symptoms”) and what are the underlying causes of the symptoms. Perspectives can be different for each team so it makes sense to carry this assessment at department level. Also, do a resources inventory, focusing on these findings and the desired outcome. With this understanding, each team will set out how they contribute towards the organisational objective. To put it differently, planning only starts now and it consists in finding objectives for various departments and identifying the main milestones. A useful approach is Objectives and Key Results where objectives are about the WHAT and Key results are about the HOW; the latter have to me measurable and timed (eg. Reach churn rate of 10% by end-Q1).
It might not be very obvious but separating the two is very important. The sub-objectives and the Key results can be tracked monthly or quarterly (depending on their nature) which allows the organisation to review or change the route taken if necessary. When on the other hand the two are amalgamated in an objective we can become inflexible and waste unnecessary resources or energy.
Creativity and innovative thinking are ever more important in the VUCA environment and these are largely dependent on unconscious mental processes. To leverage these however we need to have a broad enough solution space; when the objective implies a given solution, unconsciously we are prone to accepting and don’t attempt to look for alternatives. "Creativity involves the depth of the mind and many many depths of unconsciousness" said Oliver Sacks. Even when it comes to key results we have to be worry of making them over prescriptive (eg it’s ok to agree on a churn rate target but we should avoid imposing a certain way of achieving this).