Unrealistic goals don’t just fail – they harm productivity, stifle innovation, and demoralise teams. Smart goals drive real progress.

Setting goals is essential for any organisation, but not all goals are created equal. Smart goals – Specific, Measurable, Achievable, Relevant, and Time-bound – provide a framework that ensures clarity and feasibility. When goals lack these qualities, they don’t just fail to inspire progress, they actively damage morale and productivity.

Three reasons unSmart goals are worse than no goals

  1. They create anxiety and reduce productivity
    When goals are vague, unrealistic, or unmeasurable, employees are left in a state of uncertainty. This creates anxiety as they don’t know how success is defined or whether their efforts are making a difference. Stress and confusion lead to hesitation, inefficiency, and ultimately, lower productivity. People spend more time worrying about the goal than working toward it.
  2. They stifle creativity and innovation
    Poorly designed goals often force employees into a narrow, “Route One” mindset. Instead of allowing for lateral thinking and problem-solving, staff feel pressured to take the shortest, most rigid path to an unattainable target. They give the appearance of chasing goals without the substance. This kills innovation and discourages teams from experimenting with creative solutions that could provide long-term value.
  3. They lead to inevitable demoralisation
    When an unattainable goal is set, failure becomes a foregone conclusion. If a team spends three months failing to meet an impossible annual target, the next nine months will be spent in a state of disengagement, knowing there’s no point in trying to catch up. The result? A workforce that feels defeated, unmotivated, and disconnected from organisational success.

The Smart approach

The key to setting effective goals is ensuring they are achievable at a stretch – challenging but within reach with extra effort. A well-crafted goal pushes employees to improve without setting them up for inevitable failure.

The power of Marginal Gains

An alternative to setting overly ambitious goals is adopting the marginal gains theory, which focuses on making small, incremental improvements across multiple areas. 

This approach, famously used by British Cycling under Sir Dave Brailsford, demonstrates how a series of minor improvements – each seemingly insignificant on its own – can cumulatively lead to substantial performance enhancements over time.

Rather than overreaching for a single grand goal, organisations can drive sustainable progress by identifying multiple small areas for improvement. These gradual, consistent changes create a compounding effect, leading to significant overall growth without the risks of burnout or demoralisation. 

Applying this approach in the workplace ensures employees remain engaged, motivated, and continuously improving without feeling overwhelmed. The approach may take longer but it will be more sustainable, ending the stop-start approach of failed goal setting.

The pitfalls of numerical goals

W Edwards Deming, a pioneer in quality management and one for a snappy quote, was highly critical of setting arbitrary numerical goals. 

He argued that when businesses focus on hitting specific numerical targets, they often design systems that achieve those numbers rather than genuinely improving the company’s performance. As Deming famously stated, “A numerical goal without a method is nonsense.” Employees, under pressure to meet imposed metrics, may cut corners, manipulate data, or sacrifice long-term stability for short-term success.

Deming believed that organisations should create environments where processes naturally evolve to improve efficiency and outcomes. By adopting this philosophy, businesses can cultivate a culture of learning, adaptability, and sustainable growth rather than one driven by fear of failing to meet unrealistic targets.

As Deming also put it, “A bad system will beat a good person every time.” Even the most talented and hardworking employees will struggle if they are trapped within a flawed structure that prioritises arbitrary goals over meaningful progress. Organisations must focus on fixing systems, not just pushing individuals to meet unrealistic expectations.

Additional considerations:

  • Data supports it: Studies on workplace motivation (such as those by goal setting pioneers Edwin Locke and Gary Latham) show that overly ambitious or vague goals lead to burnout rather than peak performance.
  • Leadership implications: Managers who set unrealistic goals undermine their credibility. Employees quickly learn that leadership is out of touch, leading to cynicism and disengagement.
  • Case studies: Companies like Google use the OKR (Objectives and Key Results) framework, ensuring goals are ambitious but realistic. This balance fosters innovation without crushing morale.

Conclusion

A well-set Smart goal aligns effort with achievement, inspiring teams to push forward rather than grind to a halt. Without this structure, goals become not just ineffective but actively harmful leading to stress, stifled thinking, and a workforce that feels perpetually behind. In the long run, an unSmart goal isn’t a motivator; it’s a morale killer.