A few weeks ago, with a new year upon us, a client asked me an intriguing question:

You spend your life helping people identify goals. What are the classic mistakes people make in goal-setting?

Spoiler alert: I’m not going to simply review the virtues of SMART goals in the remainder of this post. While having smart goals is definitely better than having stupid ones, I’m assuming most readers have been taught that handy acronym (though I’d love someone to give me the definitive answer of what the A stands for – I’ve seen at least half a dozen alternatives).

My client is right. I’ve spent nearly 20 years interviewing senior executives about their goals and priorities. I’m sure I’m well on my way to 1000 such interviews and I’ve seen leaders who have had a great grasp on their direction and others who – well, let’s just say some trains of thought never reach the station.

As you and your team set goals for 2010, here are a few characteristics of great goals I’ve seen over the years:

  • SMART – OK, I lied. If you do nothing else, it’s not a bad idea to have goals that are Specific, Measurable, Actionable, Realistic, and Time-bound. If your goals need to go to school to get smarter, that’s a good start.
  • Connect to value: Too often, even when I talk with senior leaders, their goals have surprisingly few “so what’s” to them. I’m interested in the fact that you are going to implement that huge new technology system. But how will the successful achievement of that goal benefit customers, owners/shareholders, employees, and/or other key parties in your value network? This is particularly important for staff groups (IT, HR, Finance, Marketing) since their internal stakeholders are so often asking the question (perhaps out of your hearing), “Why are we spending that money on that project instead of X?”
  • Make them few enough to promote focus: I know, you’re saying that’s basic. I with I had a buck for every executive I’ve met who has 6,7,8,9… goals. Every one of us thinks we are exceptional, but most human beings (and every organization I’ve known) can only focus on a very few things at a time. Think 3-5 maximum and I think your team members will give you a standing O. (OK, maybe not – but a little fantasy doesn’t hurt.)
  • Give innovation and growth priority: Most team members intuitively know that long-term success depends on adjusting and trying new things. Yes, we need to take care of basics (especially in tough economic times), but I find that organizations need some sense of where the new life-blood is going to come from. Otherwise, people start to mutter Einstein’s “If we do the same thing expecting different results…” quote to themselves. That’s a sign they are losing belief in the long-term viability of the current operating philosophy. They’re looking for what will take the organization to the next level of growth and performance. Do your goals speak to that?

So that’s my starter on what makes a good set of goals. What would you add from your experience?