Spend some time in most business organizations—as I have done over the past 35-plus years—and you will likely observe the practice of cascading goals top-to-bottom. Why? Because executive teams believe: a) it is the way to align organizational goals and people’s activity, to implement strategy; b) it is a way to exercise control over what happens in the organization; c) it is the means to holding people accountable and the basis for evaluating people’s performance; and d) it is what other executive teams do.
So how does it work? After the executive team establishes strategic goals for the business they then use them as objectives for the people in the organization to focus on and accomplish in the coming year or so. To this end they send them on down through the organization’s hierarchy as a way of implementing their strategy. Eventually these goals reach those performing the organization’s work.
The objective, and in turn the aim of all managers in the hierarchy, is to see to it that those below them are working toward accomplishing the strategic goals. What better way to provide direction for and gain control of what happens in the organization! Set goals then hold people accountable for accomplishing them—brilliant! After all business is all about results, so what better way to keep the focus on results than to force measurable goals for results through the organization.
It sounds like a perfect plan: It is so logical and oh so linear! Yet the tale of the tape shows most strategy implementations don’t quite measure up to expectation. The dominos don’t quite fall as expected. Just because the top executives decide on a goal doesn’t mean that the organization is organized/structured for and capable of accomplishing it. If the organization’s structure is aligned and it is capable, it seems reasonable to ask why isn’t it now doing it? Clearly there must be something missing!
On the other hand, if the corporate strategy requires a change of the organization’s work then cascading goals would be an inadequate way to develop understanding of the organization’s new work and the associated new direction of the organization. In this case it is the change in the system itself that requires the focused attention of the executive team and not merely the setting of measurable goals and lining up the dominos.
It’s Not Linear It’s A System
The assumption underlying the practice of cascading goals is that the organization’s goals are directly applicable and linearly connected to everyone else’s work—the operative words are directly and linearly. What is not realized and understood is that while everyone has a part to play in the performance of the organization, everyone’s part (and associated performance) can’t be defined directly from and linearly connected to the organization’s goal and to be measured as if independent of everything else.
Organizations are social systems—human activity—wherein relationships, interactions not parts, determine performance. In other words, every action will impact multiple relationships throughout the system. Therefore, understanding toward effective management of the system can’t be realized through reductionism. The organization’s work cannot be framed as the linear sum of each individual’s effort—the organization’s work doesn’t line up that way. The organization is a system—a complex whole of reciprocally interdependent elements in mutual relation—not a linear series of independent activities, even though the management structure is created as if it was. In other words, the implementation of strategic goals should not be thought of being synonymous with lining up a series of dominos with all that is needed from those in authority is to tip the first one to lean on the others in sequence.
Invariably it is assumed the goals are independent and thus they are framed in isolation of each other—each goal is to be accomplished without regard to its relationship to other goals. But often the maximization of one requires the minimization of another—yes they are often negatively correlated if not mutually exclusive—and more often than not the executive team’s strategic goals are not within the direct control of those doing the organization’s work. What’s lost among many is that these are strategic goals that are (usually) not within the job description of non-executive level positions.
The further away from the top the less relevant and the more intrusive are the cascaded goals to the people doing the organization’s work. As a result those trying to do the organization’s work now have two jobs to do. They have their work plus the job of meeting the executive team’s strategic goals.
Often to those at the bottom the cascading of goals can seem like an avalanche. Therefore by cascading goals without an associated method for accomplishing them the executive team makes everyone’s job just that much more difficult—the executive team’s action is not helpful, it’s a hindrance. Therefore, what was in the mind of the executive team, a simple linear implementation (a.k.a cascading goals) is in reality an impediment to the very thing they seek, good performance.
Also the fact that each person will be judged, and correspondingly rewarded/punished, based on him/her accomplishing the strategic goals develops in each the sense that he/she is on his/her own—not only in isolation of everything else but on outcomes over which he/she has little or no control. Moreover, those held accountable are presented with a dilemma that is ‘undiscussible’, which keeps their difficulty swept under the rug. Though the obstacle is there, it remains unrecognized and unresolved by those with the authority who can do something to remove it.
Causing individuals to focus on his/her survival negatively impacts efforts toward collaboration and synergy impedes performance even more. That is to say, when faced with a choice between looking good versus doing good work, the former will win out most of the time. Again, the organization is system of relationships where performance is an emergent property and not the linear sum of each person’s effort; in other words any decrease in collaboration will likely have a negative impact upon the system’s performance.
Using strategic goals as the means and measure of individual performance is seemingly a way to look strategic in the use of annual performance appraisals. However this doesn’t change the fact that annual performance appraisals don’t facilitate performance.
It is the executive team’s job to ensure the system supports people; that is, that the system aligns with the strategic goals.
A Leader’s Work Is The System
Consider as an analogy an orchestra. While the orchestra’s conductor desires the orchestra to produce or deliver quality music, each member/musician does not have delivered to him/her the conductor’s goals that are added to and define how their performance will be assessed. Everyone doesn’t get the same version of the composition and the same goals in playing his/her music. Rather each has a different and unique part to play—at different times some play loud others soft, some high some low—that when integrated emerges as beautiful music.
Accordingly, the conductor understands the relationships that comprise the orchestra, the roles each musician play and how each member’s performance is to be coordinated and integrated in realizing the goal the conductor has set for the orchestra’s performance of the composition (i.e. the orchestra’s work). It is the role of the conductor to translate his desire for the orchestra’s performance into a direction and method appropriate to each instrument section of the orchestra. In short the conductor is there to support the members in their performance of their role toward the making of quality music. Such support goes a long way toward a great performance, or in business terms the successful implementation of strategy.
The executive team’s strategic goals are theirs’ to implement; it is not the job of others. Executives should acknowledge that, “…the conductor of an orchestra does not make a sound…his true power derives from his ability to make other people powerful” (The art of possibilities by R. Zander & B. Zander). However “not every conductor is capable of moving beyond his own agenda and his own prejudices to see how he supports or undermines the players’ performance” ( Zander & Zander).
Clearly helping people be great requires an understanding of the system of work and the people doing the work. To this end the team must ask (it self), what could and should we do to facilitate quality work among those doing the organization’s work? How can we help them to be great?
Fulfilling their responsibility requires from executive team far more than cascading strategic goals to others. Implementing strategy is not about lining up dominos but rather about enabling those playing different roles and interacting with each other to realize their potential as they perform the organization’s work. This requires humanship and the guidance of Profound Knowledge.