Monday, August 8, 2016

SMART Goals in a SMAC World

Back after a long and deliberate break from blogging! Probably my longest thus far... Looking forward to writing and conversing with my community once again.

A couple of days back, I came across the article, The Scientific Reason Why Setting Goals can Backfire in Inc written by Rohini Venkatraman Replete with relevant data and insights, the article calls out the dangers of specific goals (SMART goals) which were and still are the darling of the corporate world, especially with the advent of MBO (Management by Objectives). Goals are cascaded down or rolled up, as the case may be. Individuals are measured against the goals achieved or not achieved (as per the manager/reviewer). The Bell Curve's existence depended on goals and still does. Organizations made and still make goal-based and goal-driven quarterly plans. This trend or practice is propelled by a strong desire to keep a control on the outcome, ensure stock prices rise, shareholders are happy, and predictability reigns. However, we also know that "predictable” jobs will be the first ones up for automation and robotization as Martin Ford mentions in his book, The Rise of the Robots.  

This process of setting goals and going all out to achieve them work very well when a large part of the external ecosystem is predictable or changes at a pace that does not have an immediate and drastic impact on the work being done. Like it was for the past fifty years till the advent of the World Wide Web, ubiquitous connectivity, and SMAC (Social, Mobile, Analytics and Cloud). And now we are entering the age of Robotics, Artificial Intelligence, and Chatbots. The coming of the digital world is changing organizations and the nature of our work at unprecedented speed. Predictability is giving way to ambiguity, uncertainty and volatility. In this context, trying to pre-define rigid goals can only lead to disaster and to being blindsided, as Rohini Venkatraman very aptly points out in the article.

Does that means we strike the death knell of Goals just as many organizations are doing or have done with the Bell Curve? IMHO, perhaps not! What we do need is to be aware of the dangers and the downside of rigid goals and creating a reward-structure based on stringent goal adherence. Authors of the Harvard Business School working paper, Goals Gone Wild, mentioned that the “systematic downside of goal setting has been disregarded for a long time”. This could perhaps be because setting goals and chasing them are easier than exploring and staying with ambiguity, learning on the go and remaining open to multiple and emergent realities. The challenge is exacerbated by the fact that most management schools excel at churning out command and controlbring predictability to the unknownharness and leverage all resources kind of a mindset as opposed to exploration, staying curious, and collaborating to solve complex challenges. In a world of wicked problems, complexity and emergence, rigid goals do more harm than good. Without the leeway to browse and explore, under pressure to deliver impossible targets against a deadline, the best of leaders turn into efficiency-driven, blinkered project managers. And the outcome can often be missed opportunities, rising frustration, and even the downfall of the business should the trend continue long enough.

The question then is, what is the formula for success in a volatile and complex world? Is there a formula at all?

Let’s take a look at the Cynefin framework as a point of reference. In the Complex domain, it is evident that practices are emergent and ambiguity rules. Specific goals give way to an overarching outcome. The current world we operate in falls in the complex domain. 

Against the backdrop of this shifting paradigms where the known is replaced increasingly by unknown unknowns (as seen in the Complex domain of the framework), goal setting can often be a futile exercise. Defining or envisioning one or more desired outcome, getting everyone involved, and enabling collaboration among groups of cognitively diverse and skilled individuals may be the route to get work done in this era. The critical question to ask then is, “If goal setting is not the way forward, what is”? I do not have the answer but I have attempted to provide some alternatives to goal setting in this post.

The nature of work and projects are changing. Work will increasingly get done by a set of dispersed and distributed individuals who are experts in their own space/field, and are cognitively diverse from each other. This set of individuals will likely come together within an organization to form a project team (much like a movie team comes together) and disperse once the work is done. They may also be individual freelancers coming together to complete a project bringing their expertise to the table. These individuals are not likely to be driven by rigid goals set by someone somewhere unknown to them. They will work in a collaborative manner very akin to a closed community to deliver a project outcome (in the manner of Wikipedia and Linux). As we move forward, projects and outcome desired will become increasingly more complex requiring cognitively and creatively diverse individuals to come together to deliver value. Goals will be set around the project rather than at an individual level. The success of the project will signify success for the team. An organization that fails to foster an environment where such communities can come together will very likely flounder. And those that enable such communities will innovate and thrive in the VUCA world.

I have highlighted some of the pitfalls of following rigid goals as I see it:

Can kill exploration -- Predefined goals often block the ability to see around it, especially in times of stress. Yet, it is during the most challenging times that we need to see beyond the obvious. Often, an overly narrow focus can be detrimental to innovation and  can lead to missed opportunities. Most of the well-known innovations of our time came from tinkering around and perhaps failing at some seemingly important task (remember the Post-It Notes!). An over-emphasis on goals can also take the joy out of the process, the journey towards achieving the dream.
Can reduce collaboration –- When individuals are driven only by their own goals, a culture of competition sets in. Furthermore, when bell-curve like performance management systems rule, adhering to and meeting one’s goals become even more critical often to the detriment of the overall organizational culture. This leads to a very common syndrome seen in organizations where everyone has apparently done what they had set out to do, but the client is not happy or the project outcome is not what it should have been. The whole somehow becomes less than the sum of the parts. 
Can reduce intrinsic motivation -- Goals, when rigidly defined, can reduce intrinsic motivation. The latter arises out of a combination of autonomy, mastery and purpose (as defined beautifully by Dan Pink). Stringent goals -- especially when set by someone else -- lead to reduction in inner motivation although external milestones may drive the person for sometime. But an over-fixation on goals can make people lose sight of their passion and  purpose.

Goals definitely have their values. But in a complex and changing world, enjoying the process, developing skills like pattern sensing and a learner's approach is of greater value. 

Organizations as Communities — Part 2

Yesterday, in a Twitter conversation with Rachel Happe regarding the need for organizations to function as communities, I wrote the follow...