Stretch goals are powerful but widely misunderstood

People have been talking about stretch goals for as long as there have been goals. Google’s rapid rise has sparked a whole new series of discussions about them. It’s widely known that Google has made stretch goals a core part of their culture—their Ten things we know to be true reads: “We set ourselves goals we know we can’t reach yet because we know that by stretching to meet them we can get further than we expected”.

Despite the attention, the topic receives, stretch goals remain a mystery to most people. A mystery mostly caused by two questions that never have been answered thoroughly:

1. Should I set myself stretch goals?
2. Just how far should I stretch myself?

In this article, I’ll answer both questions from a business point of view, but I guess most of it could also apply to personal goals.

What is a stretch goal?

For most people, stretching reminds us of a physical exercise. Just like physical stretching, stretch goals should help you reach results that you couldn’t reach before. Yes, stretching may feel uncomfortable, perhaps even a bit painful—but you’ll feel good afterward. That is, if you don’t stretch yourself too much—you don’t want to strain your muscles. A stretch goal, therefore, is not a moonshot goal.

Stretch goals are not moonshots
In 1962, during a speech at Rice University, US President John F. Kennedy captured the world’s imagination proclaiming that: “This nation should commit itself to achieving the goal, before the decade is out, of landing a man on the moon and returning him safely to the Earth.” This was to become enshrined in history as the first “moonshot goal.”

Thanks again to Google, moonshot goals have seen a recent surge in the corporate world. In a 2013 interview with WIRED, Larry Page, Google’s Cofounder and CEO, said: “I live by the gospel of 10x. A 10% improvement means that you’re doing the same thing as everybody else. You probably won’t fail spectacularly, but you are guaranteed not to succeed wildly.”

Stretch goals are more like roofshots
Moonshot goals can be great, but stretch goals are more like roofshots. Luiz Barroso, a Google Fellow and a VP of Engineering, explains: “Go out there and dream big; then show up to work the next morning and relentlessly and incrementally achieve them. [...] The bulk of [Google’s] successes have been the result of the methodical, relentless, and persistent pursuit of 1.3-2X opportunities. [...] Each of them a roofshot. The combined result, though, was awe-inspiring.”

In short: A combination of roofshots (i.e. stretch goals) enable you to ultimately achieve your moonshot goal.

Should I set myself stretch goals?

Yes, you should—but you have to careful with them.

The topic of stretch goals has been heavily researched and, up until now, most research indicates that organizations and teams do benefit from setting themselves stretch goals. For some organizations, however, stretch goals can be quite a cultural change, and that’s why you have to implement them with care.  If you only just got started with a proper goal management program in your organization, it’s probably best to wait.

Below is a brief summary of that research, but the most striking insight is coming from a meta-study performed by Edwin Locke and Gary Latham who found that “the highest or most difficult goals produced the highest levels of effort and performance”. This meta-study included data of over 35 years of empirical research.

Further findings are:

• Stretch goals get the best out of teams and individuals(Locke and Latham, 2002) by exploiting their, sometimes hidden, strengths. (Baum and Locke, 2004)
• Goals that initially seem to be outside the capacity of the workforce may not actually ‘stretch’ employees since they are likely to achieve those stretch goals consistently for decades. (Howard and Bray, 1988; Locke and Latham, 2002)
• Setting challenging goals leads to much better results than employees ‘trying’ to perform their best. (Peter A. Heslin, Jay B. Carson, and Don VandeWalle, 2008)

Just how far should I stretch myself?

Stretch yourself too much and you’ll strain your muscle. Stretch your goals too much and you risk demotivation and/or unethical behavior.

Demotivation requires little explanation. If you set stretch goals which you deem completely unrealistic and entirely out of reach, you stop believing in them. And if you stop believing in them, the'll demotivate you. This becomes especially an issue in teams and organizations, where disbelief can result in a culture where it’s ok to not reach (stretch) goals, because “Hey, it’s just a stretch.”

Unethical behavior occurs when unrealistic and unachievable (stretch) goals are dictated top-down. A team of researchers found that middle-managers, when it became clear their people could not meet these goals, “[...] exploited vulnerabilities they identified in the organization to come up with ways to make it look like their workers were achieving goals when they weren't.”

Linda Treviño, one of the researchers: “Everybody has goals and goals are motivating, but there are nuances. [...] If you're not committed to the goal because you think it's unachievable, you'll just throw your hands up and give up. Most front-line employees wanted to do that. But the managers intervened, coercing them to engage in the unethical behaviors."

It requires little explanation that this can harm a business in many different ways, not the least because many (strategic) decisions will be based on incorrect data. It’s impossible to lead a company that way.

Luckily, there is a simple solution: divide the target that you deem feasible by 0.7, and that’s what you stretch target should be. So if you sold 700 books last quarter, try to sell (700 / 0.7) 1,000 books this quarter. You already know how to sell 700 books, now figure out a way to sell a 1,000 of them.

That’s exactly what stretch goals do: stimulating you to push yourself further and to try new things. Something that humans have been doing ever since.