Hitting Target Is Not Your Goal by Corey Kleinbauer

A sound growth strategy often has more to do with what you say No to, even more so than what you say Yes to.

Every company wants growth. This often means hitting "target", "plan" or "the number". After all the strategy meetings, off-sites, 1:1’s with your peers or teams discussing the various initiatives, the lone prism in which an enterprise looks through to judge their efforts comes down to how they did against the revenue plan. And why is this? Because a revenue number, or target, is linear and therefore measurable…and revenue growth is a very good thing.

Many of us came up the ranks living in that linear world. If you ask an AE what their goal is, the answer is provided before you can finish the question. “TOHITTARGET!” and in this case, that is exactly right and what everyone wants to hear. The world needs lot's of AE's who are hitting quota.

But for leadership, does hitting the monthly or quarterly revenue target mean that most things worked well and the company is performing as it should? If so, is the opposite true when you missed the number? Don’t ask your CRO - s/he will likely be too busy taking a victory lap with the former and updating their Linkedin with the latter.

Achieving revenue targets is an outcome, not a goal....and when it’s recognized as a goal, a company can become frenetic and misaligned very quickly.

Ask a fellow member of your leadership team, “what is the overall goal for all this work we are doing?”. At first you will hear something like “to hit the revenue target the Board gave us” but ask the question again eventually you are going to hear that it is to get to an acquisition, an IPO, perhaps to achieve X% market share…or perhaps it’s hitting an EBITA target or achieving profitability. If you ask a CEO or board member they may look at you and say that “it's all of those things”..and much like the AE, it’s their job to think that way. But for departmental leadership, the answer cannot be “all those things”. We all know the old quotes about trying to be great at everything and pleasing everyone.

As a department leader or Founder, it is incumbent upon you to translate what I would call the “expectations of outcome” of the Board into a more precise and measurable goal - and not multiple goals, but rather, one - and have that goal agreed upon across the leadership team. Let’s take that goal of “hitting revenue target” and not just hitting it but doing so consistently. Getting there takes some analysis as well as a look in the mirror. Basic math says that if "adding 120 new logo’s at within 10% of the historical ACV/TCV, less typical attrition of X, over the next x amount of months” shows a likely outcome of hitting your targets, your goal just showed itself to you. In this case it is new logo’s. That's your goal. That is your battle hymn. If it’s achieving profitability, then you are primarily in for an exercise of increasing efficiency, doing more with less and removing friction until you are on a calculated financial path to achieve that.

With the establishment of a goal, leaders don't stop refining things..Marketing will be focused on demand gen, Sales with their close rates, Finance with cost structure and Development with bug fixes and enhancements…all of this continues on but the agreed goal is on forefront of every action a leader asks "does this directly close the gap to my one goal?"

Once the goal is clear and agreed upon, 3 things can quickly be put into place to set a prairie fire of enthusiasm and organizational inertia.

First, make this goal known and tangible to the entire company. Get campy with it. Put up one of those thermometers made with magic marker that you have seen at local fundraisers - where the temp climbs higher with each step to achievement. Make t-shirts. Gamify it and give it visibility. Visit the progress often and prepare for those discussions with each of your team members about what they will do to continue getting there and how you will support them. Start every staff meeting with the question of what was done that day or week to drag us close to the goal. Communication of a unified goal and progress to it is also helpful to all those stakeholders in the back office as well. There are many people who are removed from the flash and bang of revenue events and therefore, not updated on what affects their daily efforts are having towards a company's goals. I know a lot of presales people who bemoan the fact that they work on deals for months and aren't notified about a deals progress or even a win until it’s announced at a sales huddle. In short, have a mechanism where achievement is tracked and progress is conspicuous. Keep it simple and have fun with it.

Second, put in place meaningful financial rewards to encourage the achievement of that goal. An annual company bonus is nice but when people don't know how they are tracking to it, or worse yet, how they can effect a good outcome, the reasons and power of financial bonuses are degraded. Bonus season has the potential for peril as well if bonuses are not what people have come to expect because they are not aware if performance is good or bad and what they could have done to create a better outcome. You may recall from the movie Christmas Vacation that instead of a bonus, Clark Griswold got enrolled in the Jelly-Of-The-Month Club and a few minutes later, there was a kidnapping and the police swarmed the house. We never found out if Mr. Shirley thought he had reason to be so cheap and incremental.

Lastly, and this is where you come in Mr. or Ms. Business leader, remove, minimize or alter all internal meetings, mechanisms, pricing and support policies and compensation plans that do not directly contribute to that goal. Especially with those endless streams of internal meetings. We are all drowning in internal “catch up calls” or daily scrums. They serve a purpose but it’s very likely that if you don't do something to get out of your normal, and give other people the space and permission to get out of theirs, you will not get to the place that you know your company is capable of. The answers are on the street. Talk to customers, partners and front line personnel and encourage candor. Share you goal and ask them for ideas on how you can accomplish it. In these sessions, it's a good idea to check ego at the door, to listen more and talk less. Make it judgement free. That’s the real definition of a safe-space. Listen to what you hear and throw away any feedback from the rare person who may be self-serving or trying to get in your good graces and don't let it sour you on the exercise itself. Be open to new approaches…to your product, pricing, incentives or sales and support processes. This takes humility, an innate curiosity and a willingness to be told you have been wrong but when you do this, you create an army of co-conspirators who are gleefully working towards that goal alongside you. Your goal is to communicate - the outcome is unity.

In summary, a goal is a verb whereas an outcome is a single moment in time. A goal is a purpose and staying on that purpose transforms work into something that is personally meaningful for many of your co-workers that you pay and depend on...and it gives everyone a ticket for a ride that they are excited to be a part of.

I hope this assists you in creating better outcomes. That was my goal.

Corey Kleinbauer