If you’ve been in the business world for any length of time, you understand the concept of cascading goals.
First, the CEO sets goals for the company. Then the executive team uses those goals as the basis for creating their own goals. Next up, middle managers do the same, all the way down to the lower rungs of the organization. The result is a hierarchical goal tree that shows how all the goals in the organization support the company’s top objectives.
It sounds nice and neat in theory, but the reality is usually much messier. A reasonable-seeming exercise in linking up goals can quickly become a quagmire.
A review of recent business literature indicates that the whole “cascading goals” idea is falling out of favor. A few examples:
- Consultant Dick Grote includes “cascading goals” in his list of “bad ideas” in How to Be Good at Performance Appraisals.
- The Washington Post has referred to “cascading objectives” as “nonsensical.”
- In Work Rules! Google HR head Laszlo Bock contends that “spending hours cascading goals up and down the company” does not improve performance.
Could it be that cascading goals simply aren’t realistic in 2017—if they ever were in the first place?
Why Traditional Cascading Fails
Those who’ve tried a cascading program will be familiar with the typical roadblocks:
- Cascading takes too long. If each layer of the organization must wait for the one above it to establish its goals, cascading can easily be held up indefinitely.
- The process is too rigid and linear. In today’s increasingly matrixed organizations, many top-level goals do not break down along the simple lines of the org chart. For example, data from Khorus, the enterprise software maker I founded, shows that in our average customer organization, over 20 percent of employees’ goals do not cascade directly from a goal held by their manager.
- Cascades grow out of date over time. If goals aren’t revisited and reset regularly, objectives within the cascade can easily get out of sync with one another. The goal tree can turn into a calcified record of the past rather than a tool to keep everyone moving toward the future.
How to Align Goals without the Traditional Problems
Considering these problems, should we just give up the idea of cascading goals?
I caution my fellow leaders to drain the bathwater (old-style cascading) without throwing out the baby (aligned goals). As CEO, I consider it highly important to develop a measurable playbook that describes what each group in the company is responsible for delivering, and how it all ties together. It not only assures me that people are working on the right things; it also engages every employee by showing them how their own goals support broader company objectives.
In working with our customers here at Khorus, we’ve developed four guidelines for setting up goal cascades that do what they were intended to—link each employee to the larger priorities of the company—without the unwanted side effects. (We prefer to call the process “goal alignment” rather than “cascading,” and fortunately, software like Khorus can help you do all the below easily and quickly).
1. Go transparent. Old-style cascading is essentially a corporate game of telephone. Employees cascade goals from their managers’ objectives—but they don’t know what the next level up is working on, much less the CEO. This opaque approach leads to those famous message distortions.
Successful goal alignment, on the other hand, begins with full transparency. The CEO should broadcast the strategic goals so everyone can easily see and access them. This allows all employees—not just executives—to grasp the big picture and immediately start thinking about how they can contribute.
2. Don’t require a rigid cascade. More than ever, company success requires collaboration across functional groups and teams. As mentioned, employees can’t count on their goals being a direct reflection of their boss’s goals. If you tell Jane she has to set five goals and make each one link up to one of yours, get ready for some goal-setting gymnastics.
Instead, allow your employees three options: they can (a) link a goal to one of their manager’s goals, (b) link a goal to a goal held by someone on a different team, or (c) create a standalone goal.
3. Start small. If your company isn’t in the habit of goal setting, creating aligned goals for the entire workforce may seem daunting. Rather than constructing a perfectly linked-up goal ecosystem, try the lean approach: The CEO publishes a set of company objectives; then, each employee creates one or two goals for themselves, specifying which company objective they support (if applicable).
Don’t let the perfect be the enemy of the good. If all employees have one or two specific goals, centered roughly around a set of well-chosen company objectives, you’ll be miles ahead of most companies.
4. Get on a quarterly rhythm. For most companies, resetting goals every 90 days is a good mark to aim for. This allows teams and employees to ensure that previously aligned goals don’t get out of sync. A quarterly rhythm also gives you the perfect opportunity to celebrate progress and adjust to new issues and opportunities with the next set of goals.
Traditional “cascading” may be on its way out, but keeping your team on the same page—and aligned to the same overall priorities—is a permanent element of good leadership.
Would you like to start using Khorus to align your team—without old-fashioned goal cascading? Schedule a quick demo and consultation and we'll see how Khorus can help your company achieve even more of its strategic objectives.