3 Reasons Why Setting Goals Leads To Better Performance

Here are the scientific findings.

If you don't have clear and specific goals for your consulting business, read this.

Two weeks ago I had an interesting discussion with a new client around goal-setting (they gave me permission to share it anonymously). When we started discussing their goals and which metrics we could use to measure success, I felt hesitation from the partners. They didn't want to set any concrete goals.

"We don't have any hard targets in mind. Of course, we want to have good conversations with qualified prospects, and from a marketing perspective, we want people to see us as niche experts. But it's more about quality than quantity."

Now, I love the client's long-term orientation - that's a big reason why we are working together. They trust my judgment and experience, and understand that any sustainable and systematic change takes time. But this is not a valid argument to avoid setting common goals.

The main objective of advisory or coaching work is to help you achieve lasting change. This happens by identifying the gaps between where you are and where you need or want to be, and then developing a strong strategy to close these gaps.

All of our efforts are driven by a set of goals. Yes, in some cases they may cause negative side effects. But research on goal-setting is vast and points to what now is a unanimous conclusion - setting goals leads to better performance.

Edwin Locke and Gary Latham, two of the world's leading researchers on goal-setting, summarized the results of roughly 400 studies conducted over 25 years in a short article, New Directions in Goal-Setting Theory. How do our goals affect our performance?

  1. High goals lead to greater effort and/or persistence than do easy, vague, or the absence of goals.
  2. Goals direct our attention and action toward activities that matter, and away from distractions.
  3. Setting goals pushes us to retrieve old skills and motivates us to search for new knowledge.

Here's a short breakdown of those conclusions.

Greater Effort And Persistence

Locke and Latham's findings show that "specific, difficult goals consistently [lead] to higher performance than urging people to do their best."

“In short, when people are asked to do their best, they do not do so,” they explain. This is because do-your-best goals are personal and can't be put into numbers or words. This allows for a wide range of acceptable performance levels, which is not the case when we set a clear target or benchmark.

People with high goals produce more because they are dissatisfied with less. When the standards are higher (as long as we have are committed to it), we push more than those with easy goals. The biggest danger to avoid is obsessing over short-term metrics that are more noise than signal.

Direct Attention Away From Distractions

Goals force us to prioritize and avoid spending time and energy on irrelevant tasks. Without direction, we are dragged into urgent and distracting activities that don't drive any sustainable progress.

When it comes to mentally demanding work, we can only really focus on one task at a time. Multitasking - switching rapidly from task to task - results in a tremendous loss of efficiency. Clear goals reduce it, improving our working memory capacity and increase productivity.

Push Us To Retrieve Or Acquire New Skills

Of course, we can't achieve a high level of performance just by setting challenging goals - especially if we lack the necessary knowledge and skills to achieve them. Even in those cases, however, goals help us make the most of what we have while pushing us to learn more and enhance our skills.

Having clear goals helps us identify what are the abilities and/or experience we'll need to develop over time. And this applies not only to our business goals, but also to the bigger and more significant achievements we go after in our life.

Setting goals does not mean taking a short-term orientation and removing the joy from your work and practice. What you want is to improve clarity and drive, and ensure you are focusing your efforts on the right activities.

If you don't put some direction into your journey, you might end up moving in circles.

Thanks for reading. You can get more specialized and actionable growth insights for micro consultancies in our newsletter. Every Tuesday, you get one idea from Danilo, one quote from other experts, one number you need to hear, and one question for you to level up your consulting practice.

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