How often do you see goals like these?

• Quality: Attend 85% of the weekly quality review meetings.
• Finance: Submit monthly financial reports within one week of each month’s close.
• Customer Service: Increase the number of Customers completing our customer satisfaction survey by 15%.
• Personal: Join a health club and work out three days a week. (http://goalsetting.righttolead.com/)
  

They look pretty good, don’t they? They are SMART* goals. Unfortunately, SMART goals aren’t always good goals. All of these goals can be achieved without impacting your business (or yourself in the case of the last goal). All four focus on activity rather than results. That’s a problem.

The use of SMART goals has become a well established practice in many organizations. SMART is good for making goals actionable and measurable. It doesn’t help you determine whether a goal is worthwhile. That is a key distinction.

It is important to track and monitor progress and activity. That’s how you know that people are doing their jobs. That’s managing. Leading is ensuring that the activity amounts to something meaningful for your organization. Focus and reward your people based on their contribution not on their activity.

Keep in mind four points to ensure that your people are focused on the right things:

· Results matter more than activity
· Outcome-based goals create greater accountability and focus
· Goals drive measures, measures support goals
· Rough measures of the right thing can be better than “tight” measures of the wrong thing

Results matter more than activity

Activity-focused goals are those that measure completion of tasks or processes. At first glance, they look good because the execution of tasks and activities is very tangible. They sound like action. We like to see people doing things.

Activities and processes contribute to outcomes. They are not substitutes for them. How do you know whether you have an outcome-focused goal? Ask yourself, “Can this goal be met without producing a change in the organization?” If the answer is yes, then it is probably not outcome-focused. This is the case for all four goals at the beginning of this article. Going to meetings, issuing reports, and surveying customers is not the same as changing your business. How many meetings, reports, or surveys have you seen that provide little to no value? Even the health club goal might not produce a result. You could decide to celebrate each workout with a pitcher of beer and a pizza!

If the goal doesn’t state a positive change to your business, it is not outcome focused.

Converting an activity-based goal into an outcome focused goal is pretty simple. Ask yourself why you are doing the activity. In the case of the quality goal listed above, the answer might be to reduce defects. Now you have an outcome. If you can’t come up with a good “why” for an activity (you’ll be surprised at how often you can’t), then it’s you probably should not be doing it at all!

Think about the difference between a goal to reduce defects and a goal to attend quality meetings. Imagine how people’s focus and actions, both in and out of the quality meetings, would change.

Outcome-based goals create greater accountability and focus

I once had a manager come to me with a long list of activity based goals. One of them had to do with regularly attending an integration meeting. The purpose of the meeting was to ensure that the each department’s needs were being built into the final solution. After we discussed the goal, she changed it. The new goal focused on ensuring that our requirements were being met. She looked at the goal and said, “Wow, that’s big. That’s hard. It’s sort of scary.” She understood.

She came in with 12 activity-based goals and left with 3 outcome-based goals. She knew that she would have to work harder than ever to accomplish those three goals, but if she did accomplish them, she’d make a significant contribution to the organization. She felt a lot more accountable—it was no longer possible to succeed simply by staying busy.

Goals should drive activity, but your goal should not be activity. It should be to change your business in a positive way. Focusing on a small number of outcomes rather than a large number of activities will help you drive real business results.

Goals drive measures, measures support goals

Often a company’s existing metrics become proxies for outcomes. Managers look at the metrics and make their goal to change them. This can work; especially if the metrics are already outcome-focused. However, if the metrics are activity-based, they simply drive more activity, not more results.

For example, a public affairs department measured the number of programs they provided, program participants, and volunteer hours. They tracked this data meticulously. Over time, their goals began to reflect the number of programs, participants, and volunteer hours they had. But, their real responsibility was to improve the company’s image in the community! They drove their goals from their existing metrics and lost sight of the original outcome.

Goals should drive metrics. Figure out what you want to accomplish and then determine how to measure it.

Rough measures of the right thing can be better than robust measures of the wrong thing

Managers are under increasing pressure to be “data driven”. Data is good. However, when used improperly, it is easy to fall prey to precise, well quantified measurements of the wrong things. Einstein is said to have kept a sign in his office that read, “Not everything that counts can be counted, and not everything that can be counted counts.” In pursuit of a “good” measure, managers often lose their connection to the real outcome.

A recent scene from the TV show, “HOUSE” illustrates how precise measures of the wrong thing can lead you astray. In this scene, the doctors are stumped by a patient’s symptoms. Their sophisticated measures cannot find a problem. They ask House (Hugh Laurie’s character) for advice. He asks a few questions, and then instructs them to take blood samples again. He says, “This time, look at them yourself–don’t run them through the computer.” Sure enough, simple observation with a microscope revealed parasites in the man’s blood. The sophisticated computer tests didn’t “see” them.

There is a similar business-related example in the 1996 movie, “Eddie.” The movie is about a fan (Whoopi Goldberg) who is given the chance to coach the New York Knicks. In the scene, the new owner of the Knicks is sitting in his skybox looking at a partially filled stadium. His assistant enters the room with a thick report saying, “Here are the recent attendance figures.” The owner pushes away the report and says, “I know empty when I see it.” Sometimes a rough measure provides the greatest insight.

This doesn’t just happen on TV or in the movies. Many training departments use course completions, # of courses offered, or ratings on courses as key measures. Each of these is easy to define, have abundant data, and can be computed in very accurate and precise terms. Success against these measures is often the basis for claims that the training department is enabling the people in the company to perform better. This then is extrapolated to improving the business’s bottom line. However, none of those measures actually answer the question of whether people can do their jobs better. That is very hard to measure. One alternative is to just ask people how well they are doing (or ask their bosses). Some experts dismiss this as being too biased or subjective. However, while not perfect, these measures at least address the goal directly

The same is true for employee engagement, customer satisfaction, or many other “soft” goals. Sometimes a simple question or observation will tell you more than robust measures. Walk the hallways of your office. You’ll know whether people are engaged or your customers satisfied.

I once knew a person who hated doing business with a particular company. He only used them when there was no other option. He discouraged others from doing business with this particular company. However, whenever he filled out the customer survey he gave the company decent scores. When I asked him why, he said that the company performed well on the questions on the survey. It was the things that they didn’t ask about that caused him frustration. Anyone who interacted with him would have known this. Anyone who used the data would have thought everything was fine.

As a leader, you need to create goals and measures that provide the best approximation of your success and progress

SMART goals aren’t enough. They also should be well thought out. Management and leadership are two different things. Management focuses on activity, leadership focuses on results. Your organization’s goals should reflect what you want to accomplish, not what you want them to do. Being able to quantify and measure a goal is good, but only if what you are measuring matters.
* Specific, Measureable, Attainable, Relevant, Time-based