I’ve done a lot of budgeting, planning, and goal setting over the course of my career. I started as a CPA back in 1982, and was always pretty handy around a spreadsheet (even when they were just 12-column green pads).
There is certainly a science to looking into the future, and trying to predict where a business is going to go. Trouble is, there always seems to be a zillion factors that can affect the ultimate prediction of that goal.
And that brings us back to Goldilocks.
For over 30 years now, whenever I’m thinking of goal setting, I think of her, and those three bears. Because there is a lot of trial and error involved in coming up with goals that are “just right“.
And, like there are three bears in the story, in my experience I have found that there are three main types of goals that leaders can and should use to push their businesses to success
Immutable (aka the “Big Bear”)
Variable (the “Middle Bear”)
Charitable (the “Little Bear”)
Here’s how we used these three types in my service business, which was a cable TV company.
We used The Immutables for our annual budget targets – like video subscribers, for example. We’d put our annual gain goal out there like a big target at the beginning of the year, and, because it was an Immutable, it wouldn’t change for the entire year, no matter how well we did (or didn’t do) against that goal. I call it the “Big Bear” because it is on what I consider to be the “hot” end of the goal spectrum – it’s really important, so it can’t change, so it better be calculated with a heck of a lot of thought, because if it isn’t, and the company is falling far short, or conversely, killing it, that big ol’ bear becomes a very bad one.
Those over-arching “BHAG” (Big Hairy Audacious Goals) are typically an Immutable, but since they usually look farther into the future, leaders have a bit more margin for error, so they ultimately could be adjusted – which leads us into the next category….
The Variables were our most used, and most effective goal type. This was a goal typically tied to an operating metric, like the Net Promoter Score, or the company’s “fault rate” (i.e. the number of times a customer called in with any kind of problem with their service). We’d set a target, push hard towards it, then recalibrate based on results. If we hit it, we raised it. If we were falling far short, we admitted we erred on the front end, and adjusted it it downwards.
If the company is hitting on all cylinders, the bar will keep getting raised every few months, which is what happened to us after several years of Variables refinement. I call it the “middle bear” because it resembles a “just right” strategy more than any other, because you allow yourself the opportunity to adjust. However, there are downsides to this, especially when you are tying goal achievement to incentive plans (i.e. how do you address a moving target in those plans?).
And then there are the Charitables – the “little bears”. This is an admission of sorts – yes, sometimes, I would put out a goal that I KNEW would get hit quickly and easily. Why would I do such a thing? I’ve always remembered something I read in a book many years ago about the Japanese concept of “Kaizen” – small improvements (hence, the little bear). Success begets success. Sometimes a leader just needs to kick-start it with an easy “get”, and then perhaps do it again, until the flywheel starts to turn a little easier, and those immutables and variables start looking better.
These “three bear goals”, when used at the right times and in the right combinations , can really make a difference – provided you have the instincts of a Goldilocks to determine what is “just right”.
Yes, there are a lot more to those fairy tales than meet the eye…think Goldilocks and those three bears, and be a better and more effective goal setter.