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April 20, 2007

Morph of a Nerd CEO – How Do You Set Goals?

How should goals be set?  The one word answer is HIGH!  Otherwise you won’t achieve anything worth achieving. Otherwise someone else – who set higher goals – will beat you to wherever you’re going. If what you’re doing is absolutely unique but you do it too slowly, you’ll just show faster-moving competitors what they ought to be doing and then be frustrated by eating their dust.

Full disclosure:  I’ve set goals too high more often than I’ve set them not high enough (but, in a long career, I’ve made both mistakes). When you set goals unrealistically high, people lose faith both in you as a leader and in their own abilities. The goals become jokes but people are afraid to tell you that they aren’t going to make them – they spend their time creating excuses or hoping someone else will be the first to confess tardiness.  This is a game called schedule chicken.  You can’t pull anything complex together because you really have no idea when any of the components are going to arrive – and neither does anyone else.

Nevertheless, in a technology business you’ve got to move fast both to beat the competition and to beat the changes in the technology. Remember, these changes are fractal so forecasting them far in advance is futile. You may have a good idea what’s going to happen next year, particularly if you’re making it happen. You have no idea what’s going to happen five years from now except that there’ll be radical change. That’s just the way it is.

In August of 1995 when I was at AT&T leading the effort to develop the company’s first ISP, WorldNet, I presented my management with a schedule that called for release in seven months. Our competitors at MCI already had a product.  Our customers were buying Internet access from funny companies no one had ever heard of like PSI and AOL because we had nothing that would meet their communication needs.  Even the baby bells were talking about offering Internet access.

Engineering, which didn’t work for me, said that it was impossible to deliver products in less than seven years. They knew that was true because they never released products in less than seven years.

I said I had no idea what the world was going to look like in seven years.

Engineering (and others) said that this was the final proof that I was crazy or incompetent or both.

I just found a doodad on a shelf dated April 12, 1996 congratulating team members on a great effort which culminated in the release of AT&T WorldNet on that day (OK, one month late).  It was a great team or the release would never have happened. Some of the key team members were those engineers who’d initially been so skeptical. Because we offered flat rate, all you can eat pricing and because we had a great brand, we had more customers signed up in our first week than MCI had achieved in the previous year.  Note that we had to change the rules because, despite all our hurry, we WERE late to the game.

There is no success you can have as a CEO that compares with seeing people realize that they can accomplish much more than they ever suspected. Not only their demeanor but their subsequent careers change.  So long as you can keep the people who’ve tasted the heady wine of unexpected success, you have a team prepared to keep doing great things.

This success only happens when you set a goal higher than your people would have initially agreed to on their own.  There is risk you’ll set the goal impossibly high – especially if you don’t have “buy in”; it’s your job not to do that too often. Features may have to (will have to) be dropped; you need to make good decisions. The pace while the stretch goal is being achieved is frenetic; everyone will alternate between elation and despair.  Seemingly insurmountable obstacles will arise; it’s your job to find a way over, around or through them.

You don’t want to end up with a reputation for doing the impossible; you want to end up with a team who believe that nothing is impossible for them.  That team, after a short rest and much celebration, will be ready for the next challenge.

More posts in this series:

How Hard Will You Work?

Sick Days are Sick

The Power of Silence

First Sole Practitioner

Yuk, Selling

The First Employees

The Close

When Free is the Right Strategy

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