No goal for 2023? No problem.

By: Steve Zimmerman

The holiday frenzy at year-end often turns into the resolution frenzy for a new year.  Whether it is the passage of time or the darkness of the winter solstice that causes these moments of reflection, hope springs eternal as goals are set for the new year.

Organizations are no different.  Whether it is the nonprofit budgeting process for a new fiscal year or the revising of a strategic plan, leadership sets out to clearly articulate a series of goals for the organization.  But what if there weren’t goals for 2023?  Is that heresy?

In his 1994 book Built To Last, Jim Collins coined the term “Big Hairy Audacious Goal,” and nonprofit boards have latched onto the idea of a “BHAG” ever since.  As a sector, however, nonprofits have never suffered from a lack of BHAGs.  From protecting clean, lead-free water and eliminating racism to educating youth and creating stronger, more equitable communities, a quick perusal of mission statements surfaces many BHAGs.  Unfortunately, though, too often strategy processes, board meetings and budgeting sessions are spent coming up with new targets as opposed to spending energy on the real challenge organizations face: developing the strategies necessary to sustainably accomplish these audacious goals.

The growth and professionalization of the nonprofit sector in the early 1990’s, as well as the evolution of big data, have spawned calls for increased accountability and transparency in organizations from funders, beneficiaries, watchdog agencies and the public alike.  This led to a focus on metrics and goal setting.  Bridgespan’s concept of intended impact introduced in the early 2000’s encouraged organizations to focus on “a statement or series of statements about what the organization is trying to achieve and will hold itself accountable for within some manageable period of time.”  Notably, the definition doesn’t use the word “measurable;” however, intended impact was quickly paired with theory of change, which calls for measures to monitor progress toward impact every step of the way. While the intent may be admirable, research has shown “it is not feasible, or even desirable, for all organizations to develop metrics at all levels on the logic chain.”[i]

The drive for goals and metrics has grown out of our sense of control, the desire to break down complex societal challenges – generations in the making – into manageable pieces that can be solved. But Cameron Norman points out in “Smart goals or better systems?” that “In complex systems, our ability to exercise control is highly variable and constrained and goals provide an illusory sense that we have control.  So either we fail to achieve our goals or we set goals that we can achieve, which may not be the most important thing we aim for.  We essentially rig our system to achieve something that might be achievable but utterly not important.”[ii]

Indeed, to ease our mind about the uncertainty of the future and exercise our sense of control we set goals, budgets and strategies based on data and spreadsheets. “This is a truly terrible way to make strategy” says Roger Martin in his article “The Big Lie of Strategic Planning.” He continues, “It may be an excellent way to cope with the fear of the unknown, but fear and discomfort are an essential part of strategy making.”[iii]

Even worse, the use of imperfect metrics to monitor progress may cause the focus of the organization to drift towards flawed goals instead of focusing on the strategy and actual desired outcome.  This process, called surrogation, is prevalent across organizations today and can lead to unintended outcomes.[iv] We so badly want to define and chase what can often be arbitrary benchmarks that we lose sight of why we started running in the first place. We replace the strategy in our minds with the metric goal, becoming so embroiled in the tactics, we forget to pull ourselves up to get the strategy right.

Before all the anti-measurement crusaders rejoice, there is value in monitoring progress toward the intended impact, but it is important to put the metrics into context.  Nonprofit professionals and volunteers work too hard and use resources too precious to not know if their efforts make a difference.  However, innovation is messy.  For many mission areas, there is a reason the private sector leaves these big, hairy challenges to nonprofits. Solving complex social issues requires being bold – and that doesn’t always equate to tidy metrics or reasonable goals. As Norman writes, “innovation, adaptation and discovery are not about reason, but aspiration and hope.”  Focusing on being specific, measurable and reasonable are in direction tension with “being innovative, adaptive or creative.”  The wrong emphasis diminishes our chance of accomplishing our ultimate goals. After all, “Most social transformations were not because [someone was] reasonable.”[v]

Innovation, then, is realized through continuous learning.  Therefore, creating an innovative strategy is not a one-time or episodic practice, but rather the continual process of trying, observing, listening, refining and trying again.  This constant learning is at the heart of adaptive strategy and our perspective on the organizational model, and it is through this process that organizations develop strong, effective strategies and programs that move them toward their desired impact.  Though specific goals can make this process seem manageable, the dynamic nature of our environment, the unstable funding market that nonprofits face and the audacious nature of intended impacts make the timeline for progress uncertain. Static goals only capture parts of these elements. To be successful, the strategic direction needs to recognize and hold all the elements – community influences, revenue generation and intended impact – together, while also provide the flexibility to adjust course as leaders learn from implementation.

To do so, instead of focusing on goals, focus on “creating systems and processes for action.”[vi] A goal for a youth development program might look at improving attendance and grades by certain percentages so that students remain on track for graduation. A process for action, rather, establishes a systematic reflection on how the organization – not just individual programs – is performing. Where is there room for improvement? What could be expanded? How are we reaching and interacting with constituents? Could we involve more people or partners? These systems or feedback loops should include ways to engage a variety of stakeholders, including direct constituents, staff, board, volunteers and others, and to hear their perspectives and suggestions about how programs have worked and how they might be strengthened. The involvement of those closest to the strategy not only builds a more cohesive organization but also delivers a stronger strategy. As Harris and Tayler write, organizations can’t just “hang signs around the building promoting the strategy – you need to involve people in its development.” Engagement and feedback loops allow organizations to be nimble and move quickly to refine and increase effectiveness of strategy. Focusing here, as opposed to on arbitrary or “stretch” goals, goes further toward deepening impact and building the type of community in which we want to live.

Letting go of goal setting can be hard.  But it is time to admit the complexity of the mission our sector undertakes and what we can and cannot control.  So, this year, instead of asking what your organization’s goal is, ask how you’re building an adaptive, inclusive culture that allows you to learn from experience.

A special thank you to Jeanne Bell for offering articles and inspiration for this piece.

[i] Ebrahim, A. & Rangan, V. K. (2010). The Limits of Nonprofit Impact: A Contingency Framework for Measuring Social Performance. Harvard Business School. https://hbswk.hbs.edu/item/the-limits-of-nonprofit-impact-a-contingency-framework-for-measuring-social-performance.

[ii] Norman, C.D. (2017). Smart goals or better systems?. CenseMaking. https://censemaking.com/2017/07/19/smart-goals-or-better-systems/.

[iii] Martin, R. (2013). The Big Lie of Strategic Planning. Harvard Business Review. https://hbr.org/2014/01/the-big-lie-of-strategic-planning.

[iv] Harris, M. & Tayler, B. (2019). Don’t Let Metrics Undermine Your Business. Harvard Business Review. https://hbr.org/2019/09/dont-let-metrics-undermine-your-business.

[v] Norman, 2017.

[vi] Ibid.