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Are You Measuring What Matters as a Leader?

Updated: Jul 13, 2023

Corporate success requires balancing short-term metrics with longer-term goals and objectives. Over-focusing on the near-term results without considering the bigger picture, however, is a sign of a mere manager rather than a leader. As an executive responsible for an organization’s direction, it is critical to have strong near- and far vision, be aware of market trends, and to ensure future company viability.

A recent homework discussion with my third grader reminded me that much of what we learn about individual goal-setting is directly applicable to businesses as well. My daughter is already getting SMART on how near- and longer-term goal setting is both effective and challenging. Specific, measurable, attainable, relevant, and timely goals are key to both personal and organizational success. Many of us have surely applied this methodology to our annual development plans. So why then does it seem challenging for leaders to use this approach when it comes to organizational strategy?

A common yet insufficient response I get when asking board or c-suite executives what their strategic goals are for the companies they lead is “we want to grow.” Much like my daughter wants to get better at math, most for-profit organizations want to of course grow. It’s a generic objective, however, with little chance of success without more precisely defining from where and how growth will emanate, with which clients, products, and capabilities. Similarly, leadership teams often oversimplify measuring success to only financial reports. While cash flow, revenue, and profit are highly important, they’re more often the result of achievement rather than the goals themselves. SMART corporate goals need to therefore both quantify and qualify success as representative of not only quarterly, near-term financial results, but longer-term market, client/customer, and employee positioning. In so doing, leaders will have to address attainability, which requires a pragmatic view of whether the desired company direction is within the span of its control or its investment structure, and therefore even an applicable goal in the first place.

To set well-rounded organizational goals, even a third grader’s worksheet can suffice to communicate SMARTer with investors through employees.

Specific: I want to diversify the company’s offerings. My goal is to invest more in new products and services, specifically #AI-enabled. I want to increase the share of business delivered to healthcare, banking, and aerospace customers.

Measurable: I will know I reached my goal when x% of our revenue comes from x type of work in x market. When industry analysts cite us as a leader in these fields, we have less than x% unfilled open reqs and under market attrition, and we achieve revenue growth, operating margins, and cash flow in the top quartile of our peer group.

Attainable: These goals are realistic because we have already invested in these markets/capabilities with demonstrable growth results. I will accomplish them by reinvesting x$ annually in capability and talent development to achieve my goal within two to three years.

Relevant: This #goal is important because if we do not innovate our offerings and diversify our customer base, we risk stagnant growth and outperformance by competitors. It is the best way to ensure the company's viability long-term and maximize returns for investors and employees.

Timely: I will reach my goal within three years. My deadline for my goal is month/year, and I will see a x% shift by 12 months from now, indicating the strategy is working.

I encourage anyone striving to be a well-rounded business leader - not just a contributing manager - to shift their vision from near-term metrics to longer-term success. Apply #SMART goals that are specific, measurable, attainable, relevant, and timely apply not just for your individual development plans, but for defining and tracking progress of your overarching corporate strategy. In doing so, you can move an organization from nearsighted to having better balanced 20/20 vision.

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