This blog is originally published as a sub-chapter of The G.O.S.P.E.L. of Strategy.
The first step of winning is to define your goal as clearly as possible so that you can commit to it and start achieving it. Let’s review the five subprinciples related to goal setting:
1. Always have a goal.
2. Be specific.
3. Be ambitious but realistic.
4. Be true to your desires and values.
5. Be committed.
1.1. Always Have a Goal
Setting up a goal is first and foremost; it is the starting point of winning. What you (and your company) should do depends on what you want to achieve. If you don’t know where you want to go, then which path you take won’t matter.
Paul Arden, a marketing genius, once said: “Your vision of where or whom you want to be is the greatest asset you have. Without having a goal, it’s difficult to score.”[i]
This is because not having a goal means you’ll ‘wander’ aimlessly (your decisions and actions will be purely reactive and directionless). As a result, you are playing someone else’s game, not your own game.
Denis Watley, a successful author, said: “The reason most people never reach their goals is that they don’t define them. Winners can tell you where they are going, what they plan to do along the way.”[ii] Therefore, always set a clear goal!
Having a goal is especially important for a business leader. It is the first thing people look for from a leader. People want to know: where the company is heading, what they should do, how the company can overcome its problems. People look at the leader for guidance. A leader that can’t provide direction will look weak and incompetent.
Genghis Khan, the great conqueror, once said: “Without a goal, one can’t even manage one’s own life, much less the lives of others.”[iii] So, be like Genghis Khan: have a goal! A goal is all Genghis had when he started his career as an outcast nomad. Yet, driven by his goal, he eventually became a conqueror of kings and the founder of the largest empire in history.[iv] A goal can propel you to greatness.
1.2. Be Specific
You must have a goal, but you can’t have a vague goal! Your goal must be crystal clear. Without clarity, you risk getting ‘stuck in the muddiness.’ Trying to create a Winning strategy with a vague goal is futile. A vague goal creates confusion; a specific goal provides clarity of direction, e.g.,
As you can see from the above examples, specifying your goal into measurable components makes the goal tangible and achievable. This way, you can track your goal and know whether you have achieved it or not. Bob Parsons, the founder of GoDaddy (a $3.3B domain registrant and hosting company), advised: “Anything that is measured and watched improves.”[v]
About 62% of companies today already use quantified metrics (balanced scorecards and KPIs) to set and track goals.[vi] But, you need to make sure the metrics are derived from your goal. Too often, the metrics are selected based on habit and history (i.e., not derived from the Goal).
Moreover, as a leader, make sure you communicate and cascade down your goal. Many business leaders don’t cascade down their goals to the lower level of the organization. If the employees aren’t clear about the company’s goal, they can’t contribute to its achievement. We’ll discuss this more in Step #5 Execution.
It is also essential to be specific on the time horizon of your goal. I recommend specifying both short-term and long-term goals at the same time, for three reasons:
1. Many long-term goals require a long lead-time and, therefore, must be actioned immediately. If you don’t take action from now, you’ll have difficulty achieving them later.
This is why Miyamoto Musashi, the legendary swordsman/strategist, once advised: “In Strategy, it is important to see distant things as if they are close.”[vii]
Similarly, Hermann Simon, a famous business professor, said: “To be a champion, you need to have a long-term mindset.”[viii]
Peter Brabeck, a former Nestle CEO, also said: “To have a sustainable profit, one had to take a five to 10 years’ view and be willing to invest for the long-term, even if it had a negative impact on the short-term.” He recalled his decision to stay in Russia during the Russian crisis: “If I had thought only about short-term profits, Nestle would have withdrawn, like everyone else. But, in 18 months, we doubled our market share in confectionery.”[ix]
2. Breaking down big, long-term goals into smaller, short-term goals makes it easier for implementation.
Firstly, our brain likes to process big tasks in smaller, 90-day increments. Big goals look difficult and ‘scary,’ while smaller goals look easy – just like the old sayings: “How to eat an elephant? One bite at a time.”
Secondly, our brain tends to discount the importance of something far in the future. This is why so many executives chase after urgent things, not their strategic goals. So, avoid procrastinating on your long-term goal by turning it into a series of urgent short-term goals.
3. Short-term goals give you some quick wins, which strengthen your people’s motivation and belief. Quick wins build confidence and momentum, boost employee morale, and make your entire organization more committed to the long-term goal.
An example from a London-based artisan chocolate company where its long-term goal has been made specific.
For implementation, it will be beneficial to break down these yearly goals into quarterly/monthly milestones. However, at this level, these detailed milestones are no longer in the realm of Goal-setting (they are in the domain of Planning and Execution). We’ll discuss this more in Step #4 Planning and #5 Execution.
1.3. Be Ambitious but Realistic
When you set your goal, make sure your goal is ambitious. A very wise woman once advised me: “Aim for the stars. Even if you fail, you’ll still land on the moon.” Let me pass her advice to you: Always aim for the ‘highest stars’ – either for your personal life or business.
Don’t make an unambitious goal! An unambitious goal abortively kills effort and dooms you to mediocrity. It is, by nature, unexciting. There is no point in wasting time and effort chasing something unexciting. Adopting an unambitious goal is like a surfer trying to surf on calm water (there is no fun in that: you want big waves when surfing). Indeed, the greatest tragedy in life is not that people aim too high and miss – it is that people aim too low and hit.
Therefore, choose only an ambitious goal and avoid these common pitfalls of goal setting that many people fall into:
Risk Aversion: Don’t want to take an ambitious goal due to fear of failure. By taking low-risk goals only, these people consistently meet their goals but achieve only mediocre results – what a wasted potential.
Taking the Easy Way Out: Don’t want to choose an ambitious goal due to a reluctance to implement difficult actions (afraid of hard work). By taking the easy-to-do actions only, these people avoid hard work but fail to achieve anything meaningful – unfortunate they are.
Pessimistic Tendency: Don’t want to make an ambitious goal due to a tendency to minimize the maximum loss. As a result, these people only achieve sub-optimal results – what a pity.
Lack of Confidence: Don’t want to make an ambitious goal because these people don’t believe in themselves. They don’t even dare to try, assuming that ambitious goals are for other people only – a tragic mistake.
While your goal must be ambitious, it must also be realistic (i.e., reachable). This requires a delicate balance. If your goal is too ambitious and unattainable, you/your team will lose the motivation even to try. So, an unrealistic goal only sets you up for failure. On the other hand, if your goal is too conservative and unambitious, you will only end up in mediocrity. Only a goal that is both ambitious and realistic can inspire and motivate you/your team.
And beware of just copying other people/organizations’ goals. What is realistic for them may not be realistic for you. Likewise, what is ambitious for them may not be ambitious for you. For you to create a realistic goal, you need to consider your own:
Past: What is your starting point? How has your historical path shaped you? For example, achieving a 95% market share looks more realistic if your last year’s market share was 90%.
Future: Where is the market heading? Where do you want to go? What is the end state? What are the required capabilities to win in the future? For example, suppose you see an emerging technology is growing fast. In that case, you can set a target to become the dominant player in this new industry before anyone dominates the market.
Present: Where are you today? What are your current capabilities and gaps (vs. the required capabilities)? What are your options, opportunities, and challenges? What drives performance in your industry? For example, a profit margin target of 15% can be realistic (even though the industry benchmark is only 10%) if you have already identified areas where you can surpass competitors.
1.4. Be True to Your Desires and Values
Reaching an ambitious goal requires hard work and, most of the time, many sacrifices. Therefore, you should only chase something that you truly desire and believe in (be true to your desires).
Don’t waste time chasing what you don’t like just because other people think you should. What others consider a good goal is not necessarily a good goal for you. So, when setting your goal, always ask yourself: “Why do I want to achieve this goal? What drives me to achieve this goal? Is this what I truly want? Will I be happy if I achieve this goal?”
Your goal must be meaningful to you, excite you, and make you passionate about it. The same principle applies both to your personal goal and your organization’s goal. Don’t be the tragic people who waste years chasing something that they don’t desire.
When you set a goal for your company, the goal must also be believed by your people. This reminds me of the story of Burberry. In 2006, before Angela Ahrendts became Burberry’s CEO, the iconic British icon was struggling and underperforming. When Angela became the CEO, she called all Burberry’s top managers worldwide to convene in London to discuss the performance issue. When the top managers arrived in the raining grey London, she noticed none was wearing a Burberry trench coat. She thought to herself: “If Burberry’s top people didn’t believe in the Burberry coats, despite the big discount they could get, how could they expect the customers to buy the coats for full prices? No wonder the brand was struggling.”[x]
A similar story: a few years ago, we at Coats (the world’s largest thread manufacturer) launched an innovative sewing thread. The new product is a stronger, more durable, precisely engineered thread – resulting in unmatched abrasion resistance, lower repair rates, lower returns-to-manufacturer, lower irregulars, and increased productivity for customers. On top of that, we complemented this product with complimentary industry-leading customer service, technical support, and perfect color matching technology. We expected the sales to go through the roof and set an ambitious target.
But, unexpectedly, the sales were sluggish despite such an excellent product and market-beating services. Puzzled, we investigated and found it was because our salespeople didn’t believe in the product. They thought the product was too expensive (vs. competitors’ prices). How could they convince the customers if they themselves aren’t convinced?
We realized we needed to sell to our sales team first before selling to the customers. So, we established a strong sales and marketing program for our salespeople. We trained them to fully appreciate the product and communicate why it is the best product for customers. We provided them with a simple one-page brochure, marketing video, ten pages PowerPoint presentation (for short presentation), a presentation-friendly webpage (for in-depth presentation with detailed technical info), and sample products. We ensured every salesperson had a tablet to show the video, presentation, and webpage to the best effect. In the end, the sales went through the roof, and our ambitious goal was achieved. But only after the salespeople believe in it.
In addition, don’t choose a goal that goes against your core values (be true to your values). Pursuing a goal requires a strong commitment, but one can’t commit to something against one’s values. You can ignore your values for some time. But ignoring your values for a long time will ‘eat your soul’ and make you feel miserable.
If your value system isn’t compatible with your goal, you need to either adjust your goal or change your value system. It isn’t easy to change your values, but it is not impossible. Too many people are holding on to a value system that doesn’t serve them well. If you are one of these people, you should change your value system, not your goal. Changing your values can take a long time, but it makes a profound impact.
Don’t underestimate the importance of values for other people in your organization. It sounds cheesy, but values do motivate your people. Your employees will fight and ‘sacrifice’ for the company when its goal is a worthy ‘just cause.’
Peter Senge, a senior lecturer at MIT Sloan, said: “When you ask people about what it is like being part of a great team, what most striking is the meaningfulness of the experience. People talk about being part of something larger than themselves, of being connected, of being generative. It becomes quite clear that, for many, their experiences as part of truly great teams stand out as singular periods of life lived to the fullest. Some spend the rest of their lives looking for ways to recapture that spirit.”[xi]
Therefore, when you set your company’s goal, do stand for something bigger than your company: something big, noble, and worthy of sacrifice. Exactly as Simon Sinek, a leadership expert, said: “Customers will never love a company until the employees love it first.”[xii]
Be true to your values, and standing for something bigger than your company, doesn’t mean you can’t make much money. Don’t be mistaken: in business, you can earn good money while simultaneously addressing society’s problems. There is extensive literature on this topic (i.e., business as the force of good).
Researchers found that a business can be a force of good – not by doing charity or giving out money, but by solving the pressing needs of society and selling solutions. For example, during the COVID-19 pandemic, many pharma companies were racing to develop a vaccine. The motive might be profit-seeking, but the impact is the same: addressing society’s most pressing challenge. It is just like what Richard Branson, a self-made billionaire, said: “Do Good, Have Fun, and the Money Will Come.”[xiii]
So, don’t think that business is a zero-sum game where there are winners and losers. In business, you can succeed in a way that benefits everyone around you (others can prosper too from your success). Business is a value creation game, i.e., a ‘game’ where everybody wins (albeit in varying amounts).
'Do Good, Have Fun, and the Money Will Come.' - Richard Branson, Billionaire
Last point for this section: If your business is part of a bigger group, then your unit’s goal must also align with the overall group’s vision and mission. For the sake of clarity, the difference between mission, vision, and goal is as follow:
1.5. Be Committed
Over the years, I have learned that commitment is an essential prerequisite for winning. It is the first cause that results in all subsequent effects. Commitment is the organizing force that makes things happen. Curiously, they don’t teach us this fact in school. So, let me tell you this: once you have set your goal, you must be committed to the goal. Keep this constantly in mind. Weak commitment brings weak results, just as a small fire makes a small amount of heat!
Being committed is also the hardest part of a winning strategy. Being committed means that all your actions must conform to your goal. Don’t waste any effort, resources, or time pursuing things that don’t lead to your goal. Often, to reach your goal, you have to make sacrifices at the beginning. As Napoleon Hill, a successful author, once said: “Great achievement is usually born of great sacrifice.”[xiv] Therefore, don’t be distracted by short-term gains and conflicting priorities.
Committing is the hallmark of successful people/businesses. For instance, before it became the global leader of sensors and solutions, SICK set an ambitious goal to become “the benchmark for others and set the standards on the world market.” Many other companies in the sector also paid the same ‘lip service’ about becoming the industry leader. But what really differentiated SICK was its commitment: it continuously took action to be the global leader in the sector. SICK indeed went after producing the highest quality sensors only. It kept investing in new, better, innovative sensors. It didn’t let being price-disadvantaged (quality sensors are expensive) hold them back. As a result, it realized its ambition to become the number one globally.[xv]
When you have many goals and limited time, how can you achieve all of the goals? The answer is by creating a clear hierarchy (especially important if the goals are conflicting with each other). This is as Peter McWilliams, an activist and author, advised: “You can have anything you want in life. You just can’t have everything you want.”[xvi] I recommend you to prioritize all your goals into three different categories ruthlessly:
Category #1 – Must Do, No Matter What. These are 1-3 goals, which make a significant difference in your life/your business. You should spend no less than 70-80% of your time here. If you can focus on these goals, you’ll see significant changes in your life/your business.
Category #2 – Should Do, When Free. These are 5-10 goals, which you would like to pursue but don’t make a significant difference in your life/your business. You should spend at most 20-30% of your time here. These goals are dilemmatic: they are important enough but aren’t significant enough. If you can, ignore this category and focus on Category #1.
Category #3 - Don’t Do, Reevaluate. These are various goals that are nice to have but not crucial for your life/your business. Don’t spend any time here. If you can’t do so, spend at most 10% of your time here. If you can let go of these goals, you’ll find more time to work on more important things in life.
Conflicting priorities are dangerous because they weaken commitment. For example, I once facilitated a workshop for a Dutch company. The workshop objective was to determine the company’s goals for the next three years. The executives of the company, during the workshop, came out with the following goals:
Ensure the highest quality products.
Win long-term contracts with the three largest retailers.
Create strategic partnerships with top suppliers.
Make the employees proud of working with the company.
At first glance, the four goals above sound good. But, upon reflection, some of these goals are actually conflicting. The three largest retailers are mainly interested in low-priced products, so the company must significantly push down its prices to win long-term contracts from them. But if the company pushes down its prices, it won’t be able to deliver the highest quality products profitably – unless it can squeeze more from the suppliers. If the company squeezes more from its suppliers, it won’t be able to create a strategic partnership with them. And it is challenging to make employees proud of a company whose primary focus is squeezing every cent in its operation.
After the reflection session, the company’s executives decided to prioritize the highest product quality. Instead of chasing long-term contracts with the biggest retailers, they committed themselves to win the high-quality segment of the market. The refined goal is now as follow:
Ensure the highest quality products.
Win long-term contracts with quality-oriented retailers.
Create strategic partnerships with quality-oriented suppliers.
Make the employees proud of the highest quality products we produce.
As you can see, we need to be careful when setting up goals to have no conflicting priorities.
Another tip: Writing down your goal helps you commit to a goal. A study suggested that you can double your chance of success by writing down your goal from 20% of chance (having a goal but not writing it down) to 40% (having a goal and writing it down).[xvii] Therefore, don’t underestimate the power of writing your goal down.
By writing your goal down, you structure your thinking and commit your heart.
***
Once you have committed to a goal, you will need a strategy to achieve the goal. Strategy directs all decisions and actions toward the desired end result. Without it, your results will be haphazard. With it, you can reach the goal methodically with relative certainty. To determine your strategy, you will need to assess your options as there is always more than one way to achieve your goal.
Continue to explore the secrets of Winning Strategy here.
[i] Paul Arden. 2003. It’s Not How Good You Are, It’s How Good You Want to Be. Phaidon. [ii] www.quotationspage.com/quote/3127.html [iii] www.forbes.com/sites/ryanholiday/012/05/07/9-lessons-on-leadership-from-genghis-khan-yes-genghis-khan/ [iv] Duncan Stephenson. 2020. Genghis and Risk: Outcast Nomad to Conqueror of the World - How to Manage and Exploit Risk for Success. Independent Publisher. [v] www.oberlo.com/blog/best-inspirational-business-quotes [vi] www.2gc.eu [vii] www.quotes.net/quote/15926 [viii] Hermann Simmon. 2009. Hidden Champions of the 21st Century: Success Strategies of Unknown Market Leaders. Springer. [ix] Deborah Ball. 2002. Slow and Steady is Winning the Race and Driving Nestle. Wall Street Journal. [x] hbr.org/2013/01/Burberrys-ceo-on-turning-an-aging-british-icon-into-a-global-luxury-brand [xi] Senge. 2006. The Fifth Discipline: The Art and Practice of The Learning Organization. Random House Business. [xii] www.hatchbuck.com/blog/simon-sinek-quotes-will-change-your-business [xiii] www.thebusinessquotes.com/richard-branson-quotes/ [xiv] www.inc.com/jeff-haden/43-best-napoleon-hill-quotes-to-inspire-success-in-life-business.html [xv] Hermann Simmon. 2009. Hidden Champions of the 21st Century: Success Strategies of Unknown Market Leaders. Springer. [xvi] zlqs.quotepixel.com/picture/inspirational/peter_mcwilliams/ [xvii] www.boardview.io
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