Systems Vs Goals

Are goals and systems in competition or are they complimentary? A
goal is an objective to get something done. A system is a set of actions
that seemingly have the same outcome. Why then does it happen that when
we set goals – it requires changes in systems?

When starting to research the theory of goals – it is hard to find a
comprehensive theory of how goals work on where they should focus on an
organisation. There seems to be a wide consensus that without a goal –
an employee is less than likely to even show up for work. The research
focus in terms of goal setting comes from Locke and Latham out of the
late 60’s. The key points that Locke and Latham made were that
motivational goals needed to have the following dimensions: clarity,
challenge, commitment, feedback and complexity. Goals need to be clear
and measurable. Secondly, goals must be challenging, with achievement as
the final payoff. Thirdly, employees must feel part of the goal-setting
process to be committed to a clearly relevant goal. There must be a
program that involves feedback, recognition and progress reporting to
give a sense of moving towards the goal. Lastly, the task must be
complex but not overwhelming, with sufficient time and resources
available.

From this description, we see that goals are inherently tools to
motivate employees and except for point 3 that talks about a clearly
relevant goal – does not quite define where we should set our goals to
achieve something.

Now on the systems side we find that a system is defined as an input,
process, output loop that has feedback in it and thus creates a
self-perpetuating or at least self-re-enforcing loop. Systems can also
be defined as a group of parts connected by a web of relationships.

The objective of a system is to perpetuate itself, and arguably will
always involve an element of growth, or at least injection of energy –
as a system that tends to decrease in entropy – tends to disappear.

This brings us to the crux of the matter.

• Systems are there not to change as much as possible.

• Goals are there to motivate change from a non-active state to an
  active state.

• These two things are often in conflict.

Even at its best – goals are ineffective and most organisations would
tell you in order to achieve a goal, you have to set the goal much
higher than is actually intended. The people that are good at achieving
goals are rare, often brash an operate at the expense of the system. The
people that perpetuate the system are often described as lazy, selfish
and bureaucratic and they are seen as playing politics and obstructing
others to make a difference.

If we look carefully at someone that understood that there is a
different path – we have to consider the work of Deming. Deming realised
that there is a balance between improving the system and getting to
done.

Putting principle 1 and principle 10 together gives an interesting
wakeup to how we set goals.

“Create constancy of purpose toward improvement of product
and service, with the aim to become competitive and to stay in business,
and to provide jobs. Eliminate slogans, exhortations, and targets for
the work force asking for zero defects and new levels of productivity.
Such exhortations only create adversarial relationships, as the bulk of
the causes of low quality and low productivity belong to the system and
thus lie beyond the power of the work force.”

According to Deming we are purposefully creating conflict with
goals.

I think there is a middle ground

1. Create a strong purpose. This defines where the system is
   going.

2. Define goals on four levels

   1. Things that we need the system to do

   2. Things that we need to do to improve the system

   3. Things that we do to maintain the system

   4. Things that we need to do now

I do not believe in SMART goals. I believe in goals with a purpose
and I think that they idea of SMART goals confuse the real issue that
asks why the system exists in the first place and what we are doing to
make it better.

As a challenge, I would ask a manager to spend the same time that
usually goes into goal setting and to use that time to ask employees how
we can strengthen the system, remove inefficiencies and move closer to
where we are going as a company. When you start doing this – you
naturally build goals that are both there to achieve results and to
strengthen the system achieving the results. Many goals I find
traditionally are simply set to achieve a result where the underlying
system to achieve it is simply not defined, clear or considered when the
goal is set.

The second point in terms of goal setting is also that once I have a
goal – I need to understand how the system is going to get us to
achieving that goal. The goal thus needs to be moving the system forward
and must be using the system to achieve its task. The items that
constitute the goal must actually be manipulable by managers. I find it
fascinating that we can set a goal of e.g. achieve $ 100 million in
sales. The reality is that sales from entities that is outside of our
system, will never happen and that the only influencable items from a
goal is the things that I can ask sales people to do more of which may
include more calls, more visits, quality in the way that we present.

I believe that this is why the balance scorecard and the strategy
maps became so popular in the mid 1990’s and early 2000’s. They actually
for the first time started to establish a relationship between goal sets
and variables. I think however that the balance scorecard by Kaplan and
Norton represents a generalisation of a much larger question around
goals and goal theory.

So, this brings us to a conclusion that states that goals should be
set on both an institutional and a functional level. Goals must be clear
in terms of what they need the system to achieve and need to focus on
the influencable items that are in the organisations’ control.

14 Principles of Deming

1. Create constancy of purpose toward improvement of product and
service, with the aim to become competitive and to stay in business, and
to provide jobs.

2. Adopt the new philosophy. We are in a new economic age. Western
management must awaken to the challenge, must learn their
responsibilities, and take on leadership for change.

3. Cease dependence on inspection to achieve quality. Eliminate the
need for inspection on a mass basis by building quality into the product
in the first place.

4. End the practice of awarding business on the basis of price tag.
Instead, minimize total cost. Move toward a single supplier for any one
item, on a long-term relationship of loyalty and trust.

5. Improve constantly and forever the system of production and
service, to improve quality and productivity, and thus constantly
decrease costs.

6. Institute training on the job.

7. Institute leadership. The aim of supervision should be to help
people and machines and gadgets to do a better job. Supervision of
management is in need of overhaul, as well as supervision of production
workers.

8. Drive out fear, so that everyone may work effectively for the
company.

9. Break down barriers between departments. People in research,
design, sales, and production must work as a team, to foresee problems
of production and in use that may be encountered with the product or
service.

10. Eliminate slogans, exhortations, and targets for the work force
asking for zero defects and new levels of productivity. Such
exhortations only create adversarial relationships, as the bulk of the
causes of low quality and low productivity belong to the system and thus
lie beyond the power of the work force.

• Eliminate work standards (quotas) on the factory floor.
  Substitute leadership.

• Eliminate management by objective. Eliminate management by
  numbers, numerical goals. Substitute leadership.

11. Remove barriers that rob the hourly worker of his right to pride
of workmanship. The responsibility of supervisors must be changed from
sheer numbers to quality.

12. Remove barriers that rob people in management and in engineering
of their right to pride of workmanship. This means, inter alia,
abolishment of the annual or merit rating and of management by objective
(see Ch. 3).

13. Institute a vigorous program of education and
self-improvement.

14. Put everybody in the company to work to accomplish the
transformation. The transformation is everybody’s job.