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How to set goals in uncertain situations.
I’m an author, organizational sociologist, strategy professor, unsuccessful furniture maker, and Xoogler—this is yet another of my attempts to make sense of the state of not-knowing.
In a couple of weeks, I’ll be helping an organisation set goals under uncertainty. (If pandemic fears don’t shut down international air travel and cause the collapse of civilization.)
In an idyllic, riparian setting far from the nearest megalopolis, I’ll run a pretty weird goalsetting exercise with five groups of leaders from several international offices of a large organization in an industry undergoing massive upheaval.
I call this exercise Boris. I’ve done versions of Boris with both for- and not-for-profit organizations. It’s based on my research on how innovation teams set goals when concrete desired outcomes can’t be defined. This is the default situation any organization faces when pursuing real innovation or exposed to true uncertainty.
(Boris is the goalsetting analog of negotiated joining, which is how innovation teams should find new members when their roles can’t be defined in advance—for more on negotiated joining, see issue #16.)
For anyone who’s gone through a conventional (and usually time-intensive but ultimately unhelpful) goalsetting exercise, Boris initially seems really weird because it focuses on things which conventional goalsetting usually ignores.
But every team that’s gone through Boris says it works in unexpected ways. It unblocks teams that had been stuck for ages by giving their members freedom to act responsively to changing situations without working at cross purposes with other parts of the organization.
Boris works where conventional goalsetting doesn’t because innovation and uncertainty screw up conventional ways of thinking about setting and managing goals.
If the environment changes in unpredictable ways, inherently static goals don’t work. If the aim is to create something no one has created before, realistic and achievable goals don’t work.
This is true even in organizations reputed for being innovative and at the forefront of fast-moving industries.
When I worked at Google in the mid-2000s, one of the annual annoyances for anyone in the company was the process of working up objectives and key results (OKRs). Actually, OKRs were more than an annoyance. They were a yearly cross to bear, a yearly albatross.
Each level of the organization—from the individual up through functional divisions—spent weeks articulating what it was aiming for in each quarter and the year. There were endless email chains and meetings to roll OKRs up and down the organization chart.
Google, with its OKRs, had fallen into conventional ways of thinking about organizational goals. These all revolve around the idea that goals should be some version of SMART: specific, measurable, achievable, realistic, and timely. Conventional management focuses on developing goals like these and propagating them through the levels of the organization. This is supposed to align the organization and make it highly effective.
I have some additional background, having worked for some cycles as one of the downtrodden minions whose task it was to align OKRs across Google’s Product Team (nominally responsible for driving product strategy and development). From that perspective, OKRs seemed worse than mostly useless for an organization supposedly built around innovation. Even in the mid-2000s, the internet industry was changing rapidly and unpredictably. No matter how much harmonization we did, by year’s end we’d find teams working at cross purposes, individuals on the same team working at cross purposes, even individuals working at cross purposes to themselves.
OKRs ate up many person-weeks of time and, like most conventional goalsetting processes, always seemed like expensive organizational theater: useless, ritualist makework done as part of the performance of being organized.
Conventional goalsetting focuses on goals in themselves. More precisely, the conventional approach focuses on figuring out in advance what the correct goals are, then making sure everyone is pursuing those correct goals.
The problem is: when things are uncertain, the correct goals to pursue can’t be decided in advance.
Organizations need a fundamentally different way to think about setting and managing goals if they’re facing uncertainty from the environment or from their pursuit of innovation.
So Boris begins from a fundamentally different place.
The foundational difference is acknowledging that innovation and uncertainty make it impossible to predict in advance what the “correct” goals for an organization will be.
Instead, organizations working under uncertainty must be able to sense when situations change and respond appropriately. This means their members must be free to act autonomously. (For more on the importance of having these degrees of freedom, see issue #2.) At the same time, these organizations also need to make sure their members aren’t acting at cross purposes when they do so.
There’s obviously tension between the need for autonomy and the need for coordination. The only way to resolve the tension is by making explicit the constraints on what individuals in the organization can do. Goalsetting can do this, if it is designed correctly.
Boris does this by forcing people in teams to talk about the tradeoffs they are (or aren’t) willing to make, instead of focusing on figuring out concrete goals in advance as conventional goalsetting does.
The result is that team members build a shared and explicit understanding of what they can and can’t do. This frees them to do everything else needed to innovate or respond to unpredictable change.
The responsiveness Boris helps organizations achieve is practical autonomy. Autonomy is not simply the ability to do whatever you want, regardless of the consequences. Instead, it is having the ability to act in the moment using a deep understanding of current resources and constraints. This ability can only arise when you know what you can and cannot do.
Boris—and any exercise in clarifying and articulating tradeoffs within organizations—naturally clarifies which concrete actions the organization and its members should take. It thus removes much of the angst organization members often feel around not understanding how and what to prioritize given limited resources.
The unexpected—but often welcome—side effect of Boris is thus that the organization and and its members become highly effective.
It’s natural to feel comfortable about setting and focusing on goals (exciting!), and to recoil from talking about tradeoffs and constraints (what a downer!). But though people naturally recoil from doing so, talking through and explicitly agreeing on tradeoffs is what permits autonomous action.
Though everyone resists talking about constraints and tradeoffs, the simple and unavoidable fact is that they are the essential and unavoidable basis for strategy—especially under uncertainty.
If you found this useful or thought-provoking, you should definitely share it indiscriminately with masses of people. You can find previous issues of The Uncertainty Mindset here. I’m on the web at www.vaughntan.org, on Twitter @vaughn_tan, Instagram @vaughn.tan, or by email at <firstname.lastname@example.org>.