Why Do the Stretch Goals Aiming to Excel the Company Often Fail?

What is a Stretch Goal?

Stretch goals can be attributed to an over productive approach suited for highly ambitious organizations and their employees. In literal terms, they can be increased or stretched goals requiring more dedication and effort to meet the goals. The stretch goals can be unrealistic. However, they hold benefits in such a scenario as well. Stretch goals increase productivity, mind usage, and efforts and let employees know their capabilities and efficiency.

What Are the Benefits of Stretch Goals?

Stretch goals hold numerous benefits discussed below:

Promote Productivity

The excess goals initiate the workaholic nature among people. It encourages them to work more and achieve their goals more than they do regularly, subsequently increasing their productivity. 

Encourage Motivation

Challenges and technical approaches, coming by the stretch goal, encourage people. It involves participation with an active mind and will to solve something difficult. It not only satisfies their mind for high capability but also makes them look for more such opportunities to put their potential. 

Foster Enthusiasm

The interesting work to be done and the goal to be achieved increases enthusiasm. It provides a reason to get up and work on things people love. It will lead to personal and organizational growth, further moving them towards success. 

Remind Employees of a Business’ Mission

Stretch goals are proof that a company is serious about achieving its goal. It makes conscious efforts to increase productivity and efficiency. It reminds employees that their company is also working with them; it is not just making them work or managing tasks but striving to reach the goal. 

Generate Innovation

Sometimes loads of work motivate employees to find shortcuts. Without compromising efficiency, such innovative methods can be utilized on a regular basis as well. Stretch goals play a major role in such contributions. 

Gain Funding

Stretch goals can often be used in crowdfunding campaigns. It helps increase the budget, further increasing the betterment of projects and opportunities for the population and earning financial success for the organization.

What Are the Challenges of Stretch Goals?

Stretch goals represent over productivity. Hence, it will have associated challenges, including: 

• It is crucial to have clarity on the goals and achievements. Following a completely unrealistic goal decreases motivation and productivity. 
• Stretch goals are not the right tools to inculcate skills among employees. It solely depends on their ability to manage the pressure and apply their skills. It may not incorporate the ability to execute. 
• Stretch goals may have a negative impact on employee numbers and their mental status. The inability to catch up with the stretch goals or inability to meet the demands of the organization will add to low morale and frustration. This will discourage the will to work. 
• The inability to cope with pressure or demotivating work environments will encourage the employees to switch companies. The company may lose bright employees as well. 
• Over-productivity and stretch goals may lead to cheating and unethical behavior to meet the target or aim for the incentives. This will negatively impact the work culture, declining the reputation of the company. 

The Stretch Goal Paradox Explained

The stretch goal paradox deals with the exploitation associated with it, usually when the aim is to be more productive. The practical examples witness the contrary use of stretch goals. The ones with a high winning streak and good performance need it, while the ones with a losing streak should not employ stretch goals. In practice, companies suffering losses or ones aiming for more money use stretch goals to achieve more. But the employees with low morale and emotions are unable to achieve them. Rather they go with unethical actions. 

Companies with suitable success rates and high morale and performance employees go into their comfort zone. However, they have the right people, approach, and time to use stretch goals for higher achievements. It indicates the need to set stretch goals depending on the company conditions and employee status.

How to Set Stretch Goals?

The stretch goals should be set after judging the mentioned points:

1. Determine if Stretch Goals Are Right for Your Team

The primary requirement is to judge whether your team needs proximal or stretch goals. It depends on the type of employees, their work status, the amount of work assigned to them, and most importantly, their mental status. The ones who want challenging tasks or wish to achieve more and grow more rapidly are suitable for stretch goals. 

While the employees interested in the present and small achievable goals are not employed for stretch goals, there may be employees who cannot reach their present goals. Proximal goals will enable working more on their goals in an efficient way. It also involves growth, but according to the employees. 

2. Choose the Right Moment

Judge the timing correctly. Urgently aiming for more work, especially when everyone has suffered a setback, is not the correct time for a stretch goal. It will decrease productivity and will have completely negative effects. 

3. Be Realistic

Stretch goals are synonymous with over-ambition and over-productivity. Yet, they need to be set cautiously. Completely impossible goals will also have contrary effects. The best method to set a stretch goal is by first setting the practically achievable goal. Accordingly, increase the goal considering all the related factors in mind. 

4. Support Your Team Members

The Stretch goal should be accompanied by support and help. Keeping a goal and expecting the work to happen magically is not possible. Provide every requirement and ensure the right amount of sleep, food and incentives are provided to the employees. Satisfaction and fullness will contribute to the right work and achieving the stretch goals.

5. Consider Your Organization’s Goals

The Stretch goal should be focused and parallel with the organizational goals. It will ensure employee growth, company growth, and overall productivity, benefiting every involved party. It will also ensure that employees take an interest in work and strive hard to achieve the goal, as it aligns with their interests as well. 

6. Make Smart Goals and Track Your Progress

SMART is an acronym that organizations should follow while setting stretch goals. The goals should be Specific, Measurable, Attainable, Relevant, and Time-based. Do track the goals to better judge the previous decision of stretch goal. Also, it will help in setting future stretch goals. 

7. Visualize the Outcome

Encourage the team with the visualized outcome. Knowing the results and understanding what the employees are working for will help achieve the outcome more enthusiastically.

More Tips for Setting Stretch Goals

Setting stretch goals is further made easy by understanding mentioned points:

• The aim of stretch goals should be to achieve results in a particular range to decrease the pressure and workload on employees. Setting a particular point may result in an inability to achieve. 
• Let the team decide on the methodology. It helps them to develop innovative methods and satisfies their curious nature. It also helps to have fun working on challenging tasks. 
• Set the time to reach stretch goals mindfully. Employees should get enough of it to meet their present goals and work on the stretch goals. 

Examples of Stretch Goals for Employees

Here are three types of stretch goals explained for clarity in understanding:

1. Organization Stretch Goals

These express the vision of the organization. It can be unrealistic and over-achieving. But the feasibility comes with freedom of time. Objectives can be set irrespective of the fixed point of time to achieve the target, decreasing overburden.

2. Management Stretch Goals

It involves keeping expectations from the management team. It requires hard work by the particular set of employees to work on themselves individually and in combination to bring results to the organization. 

3. Individual Stretch Goals

It will be solely for the individual. They will develop, which will open new paths for their career. 

Can Stretch Goals Go Into OKRs?

Stretch goals can be added to OKRs or Objectives and Key Results by maintaining transparency. Employees should know the logic behind the stretch goals and exactly what and how they need to work. 

For instance, generally, 70% completion of objectives indicates achievement of stretch goals. Therefore, objectives should be designed consciously, and methodology should be employee-based.

Can a Business Have a Stretch Goal?

The direct and simple answer to the questions is it depends on the strategic intensity and following of ethical values. Numerous businesses failed, while few succeeded as well. The key criteria are based on the mentioned two points. It is the responsibility of managers to define the stretch goals clearly with the concerned reason and make them as feasible as possible. It should not add to employees that they follow unethical means. For instance, businesses can have stretch goals like reducing customer satisfaction and experience by working on the necessities and quality of the product. 

Who Should Set a Stretch Goal?

The authorities in companies posted at executive and manager positions can set stretch goals. Founders also hold the right to set them. The method to be followed should be decided by the employees working on the stretch goals, using their problem-solving and innovative mindset. 

How to Motivate Your Team to Reach Stretch Objectives?

Teams can be motivated to reach stretch objectives through:

• Indicate the expectations clearly
• Promote brainstorming and an innovative mindset
• Promote the change in perspective and analytical thinking to combat the challenges
• Come up with new methods to understand the negative and weak points
• Inculcate learning environment
• Give incentives or celebrate the small achievements

3 Limitations of Setting Stretch Goals

Stretch goals are accompanied by a few drawbacks which should be considered while setting stretch goals. They are discussed here below:

1. Increased Burnout Within the Team

It happens when unrealistic stretch goals are assigned, or the managers do not care about the status of employees. The inability to reach the stretch goal or complete even half of it leads to the downfall of morale. The fact that they work more than usual and are not getting the results increases their frustration. 

2. Excessive Risk-Taking Within the Team

Working only on outcomes may hamper the quality of the product or service. It leads to increased risks that harm the company in the long term. It can also deviate from the ultimate goal. 

3. Unethical Behavior

Working on impossible things will distract the employees from working differently. This can include unhealthy or unethical means. The direct impact is on work culture, which will ultimately lead to a lack of talent and, subsequently, a decrease in productivity. 

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