Common sense and research show that setting goals, targets, outputs or key performance areas is a necessary and effective way of focussing people’s attention and driving their performance and motivation. We put our trust in stretch objectives, challenging KPAs and BHAGS – Big Hairy Audacious Goals.

But like all prescribed remedies, there are side effects. One of the most serious is that you get what you ask for.

One of the most dramatic examples of getting what you asked for comes from the Ford motor company. When CEO Lee Iacocca announced the specific and challenging goal of producing a new car, the Ford Pinto, that would be ‘under 2000 pounds and under $2,000’ within a tight deadline, managers met the objective by signing off on safety checks that had not been properly carried out.  One of these safety checks concerned the placement of the car’s fuel tank which, because of its design, was later discovered to ignite upon impact.

In this case, the specific, challenging goals of speed to market, fuel efficiency, and cost were met at the expense of other goals that were not specified, such as safety and ethical behaviour. 53 deaths, many injuries and expensive lawsuits brought the point home.

Other companies have had similar experiences when they defined goals too narrowly. When salespeople are measured only on revenue targets they are likely to bring in poor quality business with low profit margins. Call centre agents become short and abrupt with clients when they are measured only on the number of calls they process per day. Managers run down stock levels toward the end of a financial period so they can make the figures look good. A focus on production outputs and mere compliance with emission control standards encourages people to overlook the broader environmental effects of their business practices.

When people are rewarded for achieving goals, it is predictable that they focus on those goals. From their perspective, that is a perfectly intelligent behaviour. Even if they are aware of aspects of the work that are not getting attention, they inevitably pay most attention to the things they know they will be rewarded for. Ironically, the more efficient the performance management and reward system is, the more serious the consequences if goals are misdirected.

The key issue is whether you will be satisfied with an outcome, regardless of how it is generated or if you are concerned with the way it is achieved. When consideration of cultural values, business ethics, safety, and environmental impact is important, narrow, output oriented goals can be very dangerous.

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