Goals setting: from SMART to FAST
For most firms goals are ingrained in their company's DNA. They are part of the furniture and an essential element for strategy execution and employee management. One of the most cited goal setting techniques and the one a majority of managers opt for is SMART goals. Pursuing those SMART goals that try to suffice the principles “specific, measurable, attainable, reasonable and time-bound” is often part of a traditional approach to goal management. Belonging to this approach are oftentimes an annual cycle, privately set and reviewed goals, and a strong linkage to incentives.
The issue with this traditional approach though is that it often undermines the alignment, coordination, and agility that is needed in today's complex business world. Not uncommonly employees set goals little ambitiously to ensure getting the promised bonus. Furthermore, privately held goals frequently lead to intransparency and consequent misalignment with strategy. SMART goals focus narrowly on individual performance. And furthermore neglect the need for collaboration as well as they don´t fulfill the demands of discussing goals throughout the year to ensure flexibility and adaptability to frequent changes.
To ensure successful strategy execution through your companies goals MIT Sloan Management Review suggested to instead of SMART goals opt for FAST goals.
What are FAST goals?
FAST goals are an acronym for goals, which are embedded in frequent discussions, set ambitiously, measured by specific metrics and transparent for everyone in the organization.
A frequent discussion of goals allows to keep focus and maintain these goals top of mind. Moreover, it helps you to keep track of progress and receive feedback on potential improvement opportunities. Those discussions also shed light on if resources need to be reallocated and if prioritizations of initiatives are still adequate. Thereby, guidance for important decisions is provided. Also, executing frequent discussion helps employees to better understand how their work contributes to the overall company's success. Moreover, it drives employee engagement.
Ambitious goals trigger you to try a little harder. They should be more difficult but still possible to achieve. Challenging the status quo of your performance usually allows you to outperform collegues with less ambitious objectives. Furthermore, it prevents employees from setting goals so low they are certain to achieve them (“sandbagging”). Next to this, when you are forced go beyond current practices, to stretch a little more and push a little further, you usually have to seek innovative and more creative ways to attain your goals. Be careful though to not exaggerate with the ambition of your goals. More is not always better here and too ambitious, so called stretch goals are not optimal for every company nor for every situation.
Specific, ambitious goals increases performance of an average team or individual. This is because goals that are specific, meaning translated into concrete and tangible metrics, clarify what employees are expected to deliver. The more specific they are the easier it is furthermore to test them. And determine what is working and what is not. This helps you to enhance your agility by adapting faster and making adequate course corrections. Moreover, you can extract concrete learnings more easily so you can boost your performance in the future even further.
Goals and their current level of achievement should be visible and accessible to everybody in the company. This helps to better align the large amount of manifold goals and consequent activities with corporate strategy. And to coordinate more effectively across silos. This way it is moreover easier to spot goals that are not (well) aligned with the overall strategy and adjust them quickly and successfully. Also, public goals can show employees what levels of performance are possible. And they help to find colleagues in similar situations who can provide advice on how they can do better. A good overview over your colleagues´ goals furthermore might help you to discover new opportunities for collaboration. This transparency can be introduced through simple boards showing your goals on sticky notes or through softwares and platforms like the one from Workpath in a more advanced and sophisticated manner.
Putting FASTgoals into action through OKRs
A lot of very successful companies such as Google, Twitter, and Netflix use an approach called Objectives and Key Results (OKRs) to put these principles into action. The approach is usually introduced as holistic framework to goal and performance management and brought to life by establishing proper OKR processes. This so called OKR cycle builds the heart of a successful agile goal and performance management system, which lets you better implement, achieve and monitor your FAST goals.
If you want to find out more about Objectives and Key Results, you can have a look at the most important OKR sources here.