It’s that time of year; when business owners take stock of the year gone by, and start to make plans for the year to come. What went well this year? What do we want to do more of? What do we want to do to make 2016 better than 2015?

When I’m reviewing plans and goals with business owners, I can’t help but think about the children’s fairy tale, Goldilocks and the Three Bears. And it’s not because I see a perfect parallel between business owners and Goldilocks, it’s because I see what’s missing. In my experience, business owners tend to think in terms of two types of goals: goals that are too small, or goals that are too big. Too often they never make the discovery that Goldilocks made; they never find goals that are just right.

Making plans that are too little

The business owner who is planning on 3% growth in sales; or planning to install new project management software; or redesigning their website, is planning on having next year be about the same as the year that just went by. Whether or not they achieve these goals, they will likely feel like Goldilocks felt when she tried the porridge that was too cold, or lay on the bed that was too soft: that there is no impact, no connection, and no satisfaction in making goals that are too little.

Maybe their vision isn’t powerful enough to drive them to take more risk. Maybe they’re just happy with things staying the same. (News Flash: things are not going to stay the same.) But their goals are uninspiring. They are managing their business, when they need to be leading their business.

Making plans that are too big

The second group is much more aggressive. They have goals like, “I’m going to double sales, and triple profits.” Rarely do these goals have any analysis behind them (do you know what it would take to double sales?). Nor do I believe that these owners have much commitment to these goals. For Goldilocks, the extremes could be costly (porridge burned her tongue). Oddly enough, wherever she was on the spectrum, living in the extremes had the same effect of no impact and no satisfaction.

When I ask business owners about these grandiose goals, the typical response is that they believe that by setting big—“inspiring”—goals, people will work harder. The thinking behind this is “even if we achieve half that goal, that’s a great year”. (I can think of nothing more disheartening than achieving half of a goal I have set for myself). These business owners are already “lost”, searching in vain for “the thing” that will really make their business take off.

Listen, if you are making goals that are only for you—if you aren’t sharing them with your team or even the key leaders in your team—then make whatever goals you want. But if you are setting goals in order to align your team (so that each of them can see the role they play in the success of your business), then it’s very important that the goals are significant, well thought through, and achievable. If goals just result in overwhelming people, or if there’s no sense of priority, that’s not inspiring.

The only way that goals will inspire and bring alignment to your team is if they can see that there is a realistic chance of achieving them, and that, by achieving them, the business as a whole wins! Everyone wants to win and achieve! Setting either unrealistic goals, or goals that are too low, can create disengagement and disappointment when the team realizes there’s no way to actually win.

Goals that are “just right”

Many business owners don’t do what Goldilocks did. For whatever reason, they have not had the courage to think deeply enough about their business to find goals that are “just right”. They either plod along making no impact or they burn out on huge goals that never get reached. In either case, they are usually asking themselves “what’s wrong? and why isn’t my staff more engaged?”

So how do we set goals that are inspiring and achievable; goals that motivate, challenge, and align our teams? To do that, we need to add the one ingredient that makes it most likely that the goal will be achieved: commitment. If you aren’t committed—if you aren’t 100% on-board with hitting these goals no matter what—why should anyone else be? You need goals that inspire you; goals that you can see will up the game of your whole business. If you aren’t personally invested in these goals, no one else will be either. Goldilocks didn’t have a team, but she wasn’t daunted; she found her “just right” every time.

To make goals you are committed to, you need to spend time thinking them through. If increasing sales is a goal, how are you going to do that? Can you raise prices? Can you sell more to existing clients? Can you reactivate old clients? What marketing initiatives do you need to bring in new leads? Can you deliver on that many projects? What do you need to add to your infrastructure to do that? I’m not saying you have to have it all figured out—you’ll never set any goals that way—but you need to have a reasonable outline that your team can buy into (and improve).

Engaging in some sort of planning exercise helps to develop the confidence (in you and in your team) that your goals are achievable. Having a goal that you and your team can be confident in will give all of you the courage to make whatever changes meeting the goal requires.

(If you really want to see engagement, then you should try inviting your team into the planning process! More on that in another blog…)

When it is obvious to your team that you’ve thought this through—and it isn’t just some “pipe dream”—they see your commitment. Your commitment means that their efforts to achieve this goal won’t be wasted.

Goldilocks meets Daniel Burnham

So. For those of us who make little goals, you should, as Daniel Burnham famously said, “Make no little plans; they have no magic to stir men’s blood and probably themselves will not be realized. Make big plans; aim high in hope and work.”

For those of us who already make big goals, that’s great. Make your plans big; but make them thoughtfully. Setting huge goals without reflecting on capacity, without including your team members (who can give you valuable information) is foolhardy. But taking enough stock to understand what your capacity really is, and how to apply it, is wise.

Once you’ve got a great plan in place, make sure that you are committed to it and can demonstrate that commitment to your team. Make sure they know their roles in helping to achieve those plans. And don’t forget to take into account a celebration, (or, like Goldilocks, a long NAP), to recognize the achievement of your goals!