Can you envision your organization setting a goal that seems impossible to achieve? Join David and Drew as they dissect the paradox of stretch goals and discuss the overarching impact of aspirational objectives on an organization's performance. We take you through the controversial concept of ‘zero harm’ and why it's so scarcely represented in academic literature.
The conversation stems from a review of a noteworthy paper from the Academy of Management Review Journal titled "The Paradox of Stretch Goals: Organizations in Pursuit of the Seemingly Impossible," which offers invaluable insights into the world of goal setting in senior management.
Discussion Points:
Quotes:
"The basic idea [of ‘zero harm’] is that companies should adopt a visionary goal of having zero accidents. Often that comes along with commitment statements by managers, sometimes by workers as well that everyone is committed to the vision of having no accidents." - Drew
“I think organizations are in this loop, where I know maybe I can't achieve zero, but I can't say anything other than zero because that wouldn't be moral or responsible, because I'd be saying it's okay to hurt people. So I set zero because it's the best thing for me to do.” - David
“The “stretch goal” was credited with the introduction of hybrid cars. You've got to have a whole new way of managing your car to get that seemingly impossible goal of doubling your efficiency.”- Drew
Resources:
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David: You're listening to the Safety of Work Podcast, episode 113. The question we're answering today is, when are seemingly impossible goals good for performance? Let's get started.
Hey, everybody. My name is David Provan, and I'm here with Drew Rae. We're from the Safety Science Innovation Lab at Griffith University in Australia. Welcome to the Safety of Work Podcast. In each episode, we ask an important question in relation to the safety of work or the work of safety, and we examine the evidence surrounding it.
Drew, firstly, apologies on my behalf that we've had a two-month break. I'd like to say, following the theory of multiple causation, that there are lots of reasons for that, but it's mainly just been slackness on my part. I guess not the good kind of slack that promotes resilience, either. It's the bad kind of slack, which is not getting around to the stuff that you want to.
But today, you prompted me this week, and we're taking a new look at an old topic, and that topic is zero harm. We talked about zero harm way back in episode 12, which is pre-Covid. It's still one of the most downloaded episodes, although I think it's been taken over by episode 95, I think it was, which is the Take Five research that you were part of.
In that episode, the original episode, we pointed out that while there's a lot of controversy and debate about zero harm as a strategy, there's actually very little academic literature on the topic. We summarize some of the main papers in that episode.
If you're relatively new to the podcast, you may want to go back through the back catalog and check it out sometime, but you don't need to have listened to it to follow what we're going to talk about today. Drew, what prompted you to come back to this topic and go looking for another paper?
Drew: David, I've been keeping a lookout for new research about all of our old topics, because one of the points of the podcast is we're trying to give up to date empirical research. Once things start to get three or four years old, maybe there's new stuff that comes along that replaces it. There hasn't really been anything significant about zero harm.
One of the main advocates of zero harm, Jared [...], has published a new handbook, which I'd recommend if you're interested in a good history of the overview of zero thinking and one of the arguments in favor of zero harm. But it's not new research, and it doesn't really engage with any of the criticism. What I did think is that we could look at the arguments for zero harm, and look at whether there is evidence that directly supports those arguments.
The basic idea is that companies should adopt a visionary goal of having zero accidents. Often that comes along with commitment statements by managers, sometimes by workers as well that everyone is committed to the vision of having no accidents.
The critics say that this is unrealistic, because you can't have zero harm. If you've got an impossible goal that leads to corruption of safety measurement, corruption of safety management, under reporting, misclassification, binary thinking, disillusionment.
But the advocates say that it's okay to have an aspirational vision that's not a concrete target. It's a goal for the future that's going to drive innovation, learning, and improvement. That turns out to be something that has actually been studied, not in safety, but in the general idea of organizations that adopt these aspirational goals.
What we're going to do today is we're going to step outside safety and look just generally, is it a good or bad idea for organizations to have aspirational goals that aren't realistic targets? David, anything else you wanted to add before we get into the paper itself?
David: No, I really like this idea. We'll introduce the paper shortly. But as soon as you sent me through the topic, I straightaway went, ooh, you didn't mention [...]. Here's an opportunity to talk about goal zero. I think organizations are in this loop, where I know maybe I can't achieve zero, but I can't say anything other than zero because that wouldn't be moral or responsible, because I'd be saying it's okay to hurt people. So I set zero because it's the best thing for me to do.
I think what this paper hopefully today starts to talk about, well, it might actually not be the best thing to do in certain types of situations. I think it's really important that organizations understand all of the dimensions of the work, again, not just in the safety science, but the setting and the achievement of these visionary goals and the organizational conditions, that the positive conditions that those goals can create and the negative conditions depending on the characteristics of the organization. It was a lot of fun to read through this paper. Would you like to introduce it?
Drew: The paper has five authors, Sim Sitkin, Kelly See, Chet Miller, and Michael Lawless, and Andrew Carton. They were all associate professors or professors at big universities in the US, Duke, New York, Houston, Maryland, Penn State. They're all very experienced management researchers. They've all got their own topics of interest, mainly focused on senior management, goal setting, and decision-making. But they also seem to be part of this ongoing collaboration on the topic of organizations that set impossible goals.
There are three or four publications, all drawn from the same total group of about seven or eight authors. I think what they have in common is that they all did work at Duke at some point in time. That's how they all know each other, and they've just got this shared interest.
The paper is called The Paradox of Stretch Goals: Organizations in Pursuit of the Seemingly Impossible. It's published in a journal called the Academy of Management Review. This is a highly respected journal. It mainly focuses on theory papers, but papers that are grounded in evidence from non management disciplines. It's a way to take economics, psychology, sociology, and build up ideas about how to manage organizations grounded in that more foundational research.
That's what this particular paper is. It's a theory paper, but it's based on a critical review of empirical research. There’s a trick to reading this work. Because the paper itself is not empirical, you've got to have a lot of trust in the authors and the peer reviewers of the journal, that they're fairly representing the work that they're basing it on, and that they're drawing reasonable conclusions.
It's pretty easy to build up a theory of anything, claiming that you're referencing lots of other work that actually you're stretching well beyond that original work. That's why it is important to think about who the authors are, what they know, what journal it’s published in. That gives you some assurance that this is not an unrealistic theory on a castle of sand. But bear in mind that this is not actual empirical research into stretch goals. These are logical conclusions based on underlying science and social science.
David: I think that's a good overview, Drew. If we start to talk about the paper, in the introduction of the paper, the authors set up this problem that organizations face, where organizations have to both balance short-term performance. This month, this quarter, achieving what we've committed to achieve in the short-term with long-term success, building for a sustainable, successful, and hopefully a better future than exists for that organization today.
Short-term performance. These are different, I guess, objectives both need to be done at the same time in an organization, because short-term performance is based on doing the things that you do now, doing them well, and possibly continuously improving those things.
Long-term performance is based more on learning, innovation, and change. What we're going to be doing next year, five years from now, and 10 years from now, things the organization might be doing might look very different to how they look today.
Drew, do you want to talk about some strategies for encouraging this longer-term innovation and some of the other parts of the intro?
Drew: Innovation is obviously something that gets talked about a lot in management literature. There are fairly well-understood basic strategies that you can do to make your organization more innovative. They range from things as basic as just having a higher turnover of employees and drawing from a wider, more diverse pool of employees, to creating whole separate units that are designed to be innovative and free from the rules and constraints of the current organization.
David: Like the Google moonshot program or something like that, a whole program, team, and resource to just go and find the next idea.
Drew: Exactly, and then there are strategies in between. Rather than having a whole separate unit, you can have more decentralization, so allowing individual business units to be more free to make big strategic choices. Or leveraging your current employees, picking out ones who aren't thriving in the current order, and putting them together in a team to do something else instead. And all broad cultural strategies like manipulating risk preferences, by the way, you reward employees in the way you're doing evaluations to encourage people to do more risk taking and less conservatism.
The overall point of all of these strategies are really three things. You're trying to redirect energy, attention, and action towards alternate futures, rather than managing the status quo well. That redirection is really quite hard to do because there's a lot of built-in incentive and motivation to do things well right now rather than to take risks that might not pay off. d
David: Drew, just for redirection's sake, it isn't necessarily in the long-term interests of an organization. One way of (I guess) trying to support this redirection is this idea of setting a stretch goal. We want to redirect the energy, attention, and action into an alternative future, but we want that alternate future to be in pursuit of this future state vision or this stretch goal, something that seems to be impossible today, but will be a great outcome if the organization was able to achieve it.
The idea of the stretch goal is that it disrupts current complacency. I don't like that word, but it promotes new ways of thinking and acting. The stretch goal might serve like a deliberate moment of crisis. You're almost creating a crisis or an uncomfortability in the organization by saying, we really want to be way over here. It's very different to where we are today.
This feeling of crisis can also do those things, promote innovation, experimentation, and new directions for the organization. The very idea of stretch goals suggests that the current ways of doing things, obviously, keep doing more of the same, then you're not going to achieve this stretch goal. So new ways of doing things are very much encouraged through the setting of that stretch goal.
Drew: A good example of this—and this is one of the success stories that's told about stretch goals—is Toyota setting a goal of cutting fuel efficiency, so doubling fuel efficiency or cutting the amount of fuel a car needs in half. There's just no way you can achieve that by making a standard combustion engine incrementally more efficient.
This stretch goal was credited with the introduction of hybrid cars. You've got to have a whole new way of managing your car to get that seemingly impossible goal of doubling your efficiency.
Another one with Southwestern airlines getting 10 minute turnaround times for airplanes at gates. It was just such a change that the regulators thought it was impossible under regulations, and the people at the airport thought it was impossible for people.
It's so disruptive that you can't just say, are we going to get there bit by bit by doing things better and better and better? You've actually got to drastically change the way you do things to meet the stretch goal.
David: I think these ideas, people might say, yeah, cutting costs in half or reducing R&D cycles from years down to months, and then in the safety space going from having maybe a number of major incidents and minor incidents every month or year to zero. It's this idea that is a really big, seemingly impossible goal when looking at the current functioning of the organization.
Drew, I think a good paper, and this is a little bit of theorizing and a little bit of literature review, I don't know quite what you call this paper, but one of the things that I like about a good paper that's written in this style is that the authors actually lay out their questions that they specifically want to answer. They actually frame this paper up underneath the title with one of the things that we're specifically interested in exploring through this paper. Do you want to talk about that? Because I know you really liked this type of format.
Drew: I think every research paper should have a research question. In this case, they've got four questions. These questions come out of the observation that there are lots of success stories of organizations who both set these seemingly impossible goals and dramatically improve their position as a result of those goals. I think the authors suspect that some of this anecdotal storytelling might be a little bit suspect.
The questions are, firstly, what are the mechanisms through which having a stretch goal might result in exploratory learning and improved organizational performance? In other words, instead of step one, steal underpants, step three, profits, step two, question mark, how do you actually get from A to B?
Given that there are mechanisms, what are the risks of those mechanisms? In other words, is it always going to be positive? Or how could it get worse? Once you've laid out those mechanisms, positives, and negatives, you can then ask, well, when does it happen? Does it sometimes work and sometimes not work? Are there patterns to when it's more likely to work in patterns when it's less likely to work?
The final question was, does this pattern actually hold true? Do the organizations that fit the pattern that should succeed, are they the ones that adopt stretch goals? Or do organizations that are unlikely to fit the pattern adopt stretch goals?
Spoiler alert, what they're doing here is pointing out a paradox, which is the title of the paper. They're eventually going to build to the argument that the organizations who could benefit from stretch goals don't set them, the organizations who are unlikely to better stretch goals do set them, and explain some of the forces that might cause that to be the case.
David: I like a good paradox in social science research. I like it when authors say, look, this is quite complex, yet we can find patterns for how these social systems are likely to work.
The definition of a stretch goal is really important. We've talked around a bit of a definition, but there's a four-point definition here of a stretch goal. One is that it's expressed as an outcome goal. It's usually a very quantifiable level of performance or an achievement of something very, very specific.
The second is the probability of reaching the goal is unknown. But at the moment, it seems to be impossible. It could be something like a 0% possibility.
It's not the same thing as a challenging goal, which has a nonzero, like a 10% probability of reaching them. That might improve our production by 20%. That might seem very difficult, but it's something that is not a 0% chance of happening. There's an expectation that the people charged with pursuing that goal will figure out the strategies on how to reach it.
Drew, when I read that definition, I straightaway thought of the moon race in the 1960s. When JFK stood before Congress in 1961 and said, "The US should commit itself to achieving this goal before the decade is out of landing a man on the moon and returning him safely to the earth.", I think what's interesting with that goal is at that point in time, NASA had never actually successfully put a person into space. It was only a year after a Russian cosmonaut was the first person into space.
The idea of not only getting into space, but actually landing a person on the moon and bringing them back to Earth was something that seemed to be impossible. But from Kennedy's point of view, which is why NASA will figure this out, I just need to set them the goal. It's not quite an organizational stretch goal, but it was definitely the one that landed in my mind when I read that definition. I don't know if you liked that example or not.
Drew: I think that's a good example of both the stretch goal and the way in which it's intended to drive performance, which is that there are a huge number of different problems that need to be figured out in order to do this. Everyone's just thinking, at some point, vaguely in the future, we might get there.
The idea is that setting that as a goal basically says, okay, you got to take risks, you got to start launching flights, and see what happens. Some of them are going to blow up. But unless we try things out and try different technologies, extreme ambition is what can drive the behaviors, attitudes, and emotions that lead you to learning and to change.
David: We might revisit that example a little bit when we talk about some of the things that contribute to those goals being successful for organizations and maybe unsuccessful.
Let's talk a little bit now back about Vision Zero, Drew. Do you think that zero harm or zero vision meets this definition?
Drew: It definitely, technically meets the definition. I struggle a bit on whether people who adopt zero harm are really going into it with the goal that people have with conventional stretch goals. As you said yourself, sometimes it might be just more of a moral frustration that the only acceptable goal for safety is zero. It's not as much of a stretch goal, it's just a reluctance to have any different goal.
But for the people who like seriously and academically defend Vision Zero as a good idea, this is what they're claiming it will have as its positive effect. Why is it a good idea for your organization to have a goal of zero? It's because having that goal will lead to innovation and learning rather than accepting the status quo as inevitable. It does fit in those terms.
It certainly is a quantified goal. It does seem to have a 0% chance of success. It's more than just challenging. For some organizations, there is an expectation that people will genuinely try to reach it. For other organizations, that fourth one might not apply, and it's more just a moral commitment rather than a strategic intent. I'm sure we've had this conversation. Have you been in an organization that had zero harm?
David: I don't think I've ever. It's definitely been hard, I guess, not as a front and center express goal of the organization. Definitely, certain business units that adopted in organizations I'd worked in. Definitely, there was some subtle background campaigning that had gone on in organizations that I was part of, but it was never on t-shirts, coffee cups, slogans, and not in what I'd imagine an organization is doing zero harm, what it would look and feel like inside, and the language was never a big part of any organization I was in.
Drew: The one organization that I've had the most interaction with with zero harm policy would be Downer. That's interesting because some of it appeared to be just more of a zero because it has to be zero. Sid Dekker would mock their staff every time they showed up with this zero harm on their pockets because it's branded onto all of the clothing and stuff like that.
What I found interesting is, this is an organization that I was involved in precisely, because they were doing a lot of research, innovation, and trying to systematically try out brand new big picture things to shift the game on safety. There was actually this alignment between the zero harm policy and an organization, which was doing that real future thinking experimentation, playfulness, and trying to drive a game shift learning. That's like N equals one, but it's one example of an organization with both zero harm and this genuine desire to make real innovative change for safety.
David: And I think that's where you mentioned earlier about why the goal is set and whether it's designed as an actual stretch goal to design that. Or there are other reasons, because obviously, the organization you're talking about is part of a contracting supply chain. It's doing a lot of demonstrated safety to a lot of clients, who have an expectation to see certain things when they're contracting certain organizations.
Again, like you said, there are reasons both moral and commercial, as well as (I guess) strategic on why organizations might set these goals. That may have been part of the case in that organization as well.
Drew: Exactly.
David: Two dimensions you mentioned. Extreme difficulty, extreme novelty. It must be a very difficult goal, and no clear and apparent discernible path to achieve it at this point in time.
Drew, let's talk a little bit about how stretch goals can facilitate and disrupt this learning and performance improvement outcomes of organizations. Do you want to explain how the authors talk through how stretch goals could create positive outcomes as well as maybe negative outcomes inside organizations?
Drew: Just as a language thing, they use these terms facilitators and disruptors, which I find a bit confusing when you're also talking about innovation at the same time. Basically, when they say facilitator they mean positive effect, and disruptor they mean negative effect on performance. I'm just going to abandon the language of the paper and talk about them as positive effects and negative effects.
They talked about the three areas where you would have positive and negative effects. Cognitive which is ways people think, affective which is way these people feel, and behavioral which is things people do. What are the possible cognitive effects of having a stretch goal?
The first one is redirecting of attention. What are you noticing? What are you spending time looking at and thinking about? That can go inwards and outwards?
Outwards, it can be looking for new sources of information and ideas, so going outside the organization and trying to find things that other people are doing, that other people are thinking.
Inwards, it can be critically questioning the assumptions that people hold. What do people think is inevitable? What do people think can't be done, shouldn't be done, or isn't worth trying? What are the frameworks? What are locking us into particular ways of thinking and doing that we can challenge and disrupt?
And then just sort of, what do you notice as it comes past? Are you more open to opportunities? Do you just see something and think, hey, we could do that, hey, that's worth trying? Rather than a more risk-based mentality that we see things and we think, oh, that's a challenge, that's a risk, let's not do that? David, anything else for you in that cognitive space?
David: No, I think you've covered that well. Really, the positive effect is thinking outside the box in what you've thought there, new ways of thinking about how the organization functions.
Drew: That's a good summary. Thinking about the box is something that everyone says that they want in the organization. But we usually don't want that in practice. We usually want people most of the time to be behaving within the box, so the box functions really well. This is like a redirecting of thought to spend more time. Not all the time, but some of the time outside the box.
The second thing is about emotion. The idea here is that there are positive emotions that are associated with learning and innovating—optimism, urgency, curiosity, playfulness. Those are all positive things that having an aspirational goal can lead people to.
The ideal is where people can actually imagine what that future looks like, so they actually want to be in the organization that is in that future. They're trying really hard to get there because they'd rather be there than where they are now. That can make people very, very motivated. That moves then on to what behaviors to those motivations lead to.
One of the simplest ones is just people try harder. When people have got somewhere that they're really looking forward to getting to, they run faster. They work longer, they work harder. But also, they're more likely to engage in trial and error-type behaviors rather than more conservative behaviors. They're likely to do that with faster cycle times. So trying, failing, trying, failing, trying, failing, doing that more often rather than longer term incremental step-by-step improvement.
David: They're all positive things. They're all things that organizations talk a lot about, so I couldn't get past when we're talking about wanting people to think inside the box and outside the box at the same time. I just had Schrodinger's cat in my mind since we were talking about that. I think those things are really positive. If your stretch goal achieves those ways of thinking, feeling, and doing in your organization, then that's really positive.
Drew: This accords with the language of innovation, move fast and break things. You're trying to inspire that attitude and reward that attitude by the goals that you're setting for people.
David: Even if we go back to the aerospace example, when you talk to people at NASA about commercial aerospace, they talk about putting these big contracts out there for the Space X's, the Blue Origin's, and all these companies to do. They don't know how these commercial companies are going to achieve it, but they put these really big contracts and opportunities out there, knowing that these organizations are going to be able to do things and work in ways that NASA maybe can't work.
Maybe we'll talk about how it doesn't quite fit the model of this paper. But definitely, you can see that industry moving away from saying, we want this done this way. We need this achieved. We need to have something that can land a person on the moon. And we need someone who can sustain life on Mars, whatever it is, and let that goal create the environment to figure it out.
Drew: When we get into the negative effects, one of the underlying principles here is, when you're focused on innovation, is your attention directed inside the organization or outside the organization?
The authors, based on a fair bit of research, say that sustainable innovation mostly requires building on and improving stuff, which is in the organization. Even though it might be a drastic change, it's still drawing on internal resources and ideas.
The risk is that when you get very frustrated or have an impossible goal that you think is impossible, people might not be inclined to do that. They might be inclined to reach out for quick fixes from outside the organization, which is not the innovation you want. It's just haphazardly borrowing outside ideas and trying to make them work.
In terms of thinking, if people can't make any sense of how to get to the goal, then they end up with disorganized and impulsive thinking. They start trying to put in place quick fixes. Rather than genuine innovation, it's more like borrowing. You're grabbing an idea that works somewhere else and trying it here.
If you're trying to learn, then learning from outside is good, but it's got to be systematic, and it's got to be genuinely bringing the ideas into the organization, rather than just haphazardly grabbing small ideas without systematically thinking whether they're a good fit, whether they're most useful, whether they're actually going to help reach the ultimate goal.
In terms of emotion, the important thing here is that emotions work in both directions. Anything that can make you happy can make you sad in the wrong environment. Sure, having an impossible goal can highlight some more exciting future and make you optimistic to get there. But it can instead make you think, oh, the goal is impossible, we're not going to get there. This is hopeless. What are we doing here?
Depending on who you've got and how they're already thinking rather than being optimistic, people can get demotivated, feel helpless, even get into this Andean innovative environment of fear, that they're actually afraid to take steps towards the goal because they fear the consequences even of trying.
The trouble is that when you're in an innovation trial-and-error type mode, you're always going to have failures. If you're predisposed to be hurt by those failures, to fear punishment, or to have your morale shattered, then that's just going to get worse and worse. You get into this cycle of early failures that makes you think that the goal is impossible. You think things are bad now because you've just failed, so you're not going to work at it.
Even for an organization that is making progress, the closer you get to the goal, the less you have initiative for working towards it because the more you're tempted back into the conservative mold of just small incremental changes.
David: I think it's fair. Did you want to finish off any more of those negative characteristics?
Drew: We just quickly finish off then with, what behaviors does it drive? A couple of things. In particular, it drives behaviors that don't have good feedback. The organization might make changes, but it's not going to have a good idea of whether those changes are helpful or detrimental. It's going to be hard to distinguish when multiple things are going on. What's actually contributing towards the success and what's not working well?
It can lead to discoordination between parts of the organization, as well as different people heading off in different ways to try to achieve the goal, different ideas of how to get to the goal, and blaming each other for not making progress or for making progress in the wrong way. That actually undermines current performance.
You're not doing well in the short-term because of trying to move towards the long-term. If you don't feel that that is worthwhile, that's just going to drive a cycle of poor performance now without supporting the positive performance towards the future.
David: We've heard those positive and negative potential outcomes that these stretch goals or processes, ways of thinking, feeling, and acting in organizations from these stretch goals. The authors don't specifically talk about zero goals, but the idea of zero harm or zero accidents, how do you think it fits with these ideas of creating positive or negative patterns and performance?
Drew: I don't think it's a great fit for the types of positive things that you would get at, for example, from saying, let's put a man on the moon, or let's make a car that is twice as efficient as a current car. Even if those seem impossible, they seem imaginable, and they seem like futures that people would want to be in. Whereas having no accidents is literally, logically impossible in the long-term, but you're always there in the short-term.
Right now, the last day, the last week, you've had zero accidents. You're there at the goal, and then you have an accident, you're not at the goal. Zero is a stretch goal seems to be much more reactive than the type of stretch goals that they're talking about as working. That's just my personal impression, that's not what they say in the paper. I'm just trying to logically think through, would it fit? It seems to fit with the negative ones, but it doesn't seem to fit well with the positive ones.
David: I think you quite passionately talked about the statistical impossibility of zero, because to have that as being a possible outcome in an organization there needs to be zero risk. I always talk to people about driving on the road, and I always use that example about short-term, long-term. I say, do you think it's possible for you to drive your car today and not have an accident? Or do you think it's possible that maybe there would be no accidents in your city today? Well, maybe that's possible.
Do you think in the next year, it's possible that no one in the whole of Australia has a car accident? People go, no, that has to be impossible. You get into this discussion about, like you said, over time it becomes quite impossible.
The authors, I think, quite deliberately, all the way through this paper, they always say seemingly impossible. They never actually say a stretch goal is something that is impossible. It's a good point. I think a stretch goal needs to be something that is practically achievable, even if you don't know how.
Drew: And I think that's the key thing. They talk about it as something with 0% probability, but what they really mean is 0% probability unless the game changes, and then the goal is to make the game change.
You could imagine, let's have zero car accidents. That could be possible with a game change, where we stopped driving cars. If Queensland committed to, we're going to make car accidents zero, how are we going to do that? That's just going to have to be a massive investment in public transport.
You could see how that stretch goal could work in that way, but it doesn't fit well with this try-fail-try because the last thing an organization working towards zero harm is going to do is accept, let's try out things that would probably get people hurt till we find a strategy that actually works better for safety. Yeah, that's very incongruous.
David: We've talked about the positive and negative patterns and outcomes. Let's talk a little bit about the contingency factors, because even in the title we talked about the paradox of where these things might be useful and not useful. The authors then go on to talk about what they call contingency factors, which are organizational factors that may make it more likely or less likely that stretch goals give you the positive effect that (I guess) is hoped for and claimed by the advocates of zero as a stretch goal. Do you want to talk about the first factor?
Drew: Based on the mechanisms for what would create a positive effect of the stretch goals and what would create a negative effect of the stretch goals, an organization that is likely to have the positive effects is an organization which is currently performing strongly.
Why is that? An organization that is currently performing strongly isn't going to be threatened by having something impossible to do, because they're used to being successful. They're used to things going well. They're optimistic that if they try hard, it will work out. They're already inclined to be optimistic, their staff already have energy, and they're motivated by the company.
The organization, in order to have been successful, must have things within the organization to build on, things that have worked well that are cognitively available to people. When people think of how we are going to be better, they'll say, oh, this worked really well, let's do more of that. They're more likely to be internally focused than externally.
Organizations that have done well, when you ask them what a successful organization looks like, they're going to say us, they're not going to say they're competitors. They're less likely to try to innovate just by trying to borrow quick fixes from the outside. They're more likely to try to do things themselves, so be genuinely innovative.
An organization that hasn't done well recently that's currently performing badly, is much more susceptible anyway to fear and defensiveness. There's already blame going around. People are used to blame. They're fearing blame. They're more likely to be looking for quick fixes because they're trying to be good now, as well as good in the future. They don't know how to be good now. When we talk about innovation, they're talking about fixing things, so certainly likely to be looking for those haphazard, quick fixes.
When you set an organization that's used to doing badly, set them an impossible goal, they're much more likely to be overwhelmed by that. That overwhelm might become hyper vigilance, it might be disorganization, it might be franticness. The strong performers are the ones that are actually more likely to have those positive effects that you're looking for.
David: I think that's a really interesting thing. It makes a lot of sense when you say it like that. A lot of the conditions, patterns, and ways of thinking, feeling, and acting, like you said, there are likely to be strong foundations in good performing companies and less foundations in weaker performing companies.
I guess in relation to safety, we can draw the obvious conclusion that a company that is already seemingly quite safe and having a low number of accidents relative to their risk in their industry, that may build on that by having a zero, but an organization that is performing very poorly when it comes to safety, maybe it's not a smart thing to set a stretch goal like zero harm. That may be the environment in which senior people in the organization think that it's most appropriate.
Drew: We are going to get onto that. Who is more inclined to put on a stretch goal? Just quickly before we get there, the other factor they point out which goes hand in hand with success but isn't intrinsically linked, is how much spare resource the organization has. The model here is to think of Google.
When Google wants to set a stretch goal, just take some of its spare cash, dump it into an entirely new organization, and say, have all the resources you want, have all the people you want, just try new things. If we lose that money, so what? That's what the ultimate in slack resources looks like.
Basically, if you've got spare time, then you can spend time innovating without taking away from getting things done now. If you've got access to resources, you can systematically look for new sources of information.
If your company is strapped on their travel and training budget, and you're only allowed two days a year to spend looking for stuff, you're going to be less able to find new ideas than a company that's got a massive internal education budget that lets people go out and do entire degrees on the company's dime.
The more spare resources you have, the more you're looking for opportunities to spend that resource, the less likely you are to perceive things as threats that are going to take away the resources that you have. It's much easier to encourage people to make suggestions and come up with ideas.
If you believe that the organization is going to back you, then if you've got an idea, you're going to make that suggestion. Whereas there's no point in making suggestions if you think that there's not going to be any money to try it, not going to be any time to try it, not going to have a chance to do it.
Basically, the more slack you have, the more you can keep doing what you're currently doing well well, and you can try something new. Whereas if you don't have slack, you're going to make a choice between the two of them. You're going to compromise current performance in order to get that future innovation, and change.
David: I think that makes a lot of sense. Good performing companies with excess capacity, in terms of resources maybe get the positive benefits of stretch goals, organizations that are maybe poor performers, stretched on resources, and maybe get more of the negative patterns and outcomes of stretch goals. We maybe gave a bit of a spoiler earlier, but what types of organizations seem to be the ones that actually pursue stretch goals?
Drew: I don't know if it's much of a spoiler when it's the whole title of the paper, The Paradox of Stretch Goals. If you're successful, if you've got spare resources, then you're not feeling any pressure to innovate. Your success breeds conservatism and risk aversion because you're doing well, you're doing fine. You don't need to change, you don't want to change.
This is like the British in the lead up to World War I. We're deliberately trying to slow the pace of innovation in warships because they were winning. Why do you want a game-changing ship when you've got the best Navy in the world? What you want is for things to stay the same.
Whereas if you're in an organization that's falling short, you feel that you're not doing as well as your competitors, or even not doing as well as you used to be, then you're looking to change direction, you're looking to turn the corner, and you're looking for big picture ways to change the whole momentum.
Basically, the type of organization that tends to set stretch goals is the type of organization where they're going to backfire. The type of organization that doesn't tend to set stretch goals is probably the one that would most benefit, most be able to learn and innovate if they were to set those stretch goals.
David: Drew, let's just touch back in then on maybe why people think, before listening to this podcast or reading this paper in terms of the authors of this paper, why do people think stretch goals are a good idea? We hear about stretch goals a lot in business. I have throughout my whole career, their specific term every year with annual performance target setting, the idea of setting stretch goals. Why might people think that it's a good idea?
Drew: The most immediate reason is just very obvious. There are a lot of success stories about organizations that have set stretch goals and have achieved success. Those are great stories. They're great stories to tell, they're great stories to read. They're very optimistic and inspiring.
Who doesn't want to be the next Apple? Who doesn't want to be the next Toyota? Who doesn't want to be the next Google? Who doesn't want a story of an organization that was struggling, then they set themselves the ambition to change the world, and they changed the world?
But if you look closely at those stories, most of them were organizations that, at the time they set the stretch goal, had good resource endowments. In other words, these are actually the people who break the pattern or break the paradox. Even though they were successful, they still decided to go ahead and set stretch goals, because they thought the way to stay successful wasn't to stay the same. It was to vote current success towards future innovation.
They're actually exceptions rather than a pattern. If you feel like you should set stretch goals, you should set stretch goals. In other words, if you are already the next Google, then go ahead and innovate. If you're already the next Apple, go ahead and innovate. If you're already the next Toyota, go ahead and innovate, because long-term, the only way to keep your lead is to do this innovation. But if you're an organization that's currently struggling, this might not be the answer to stop struggling by setting the stretch goal.
David: Or struggling or without the resources. I think that's the other good point here as well. You see these stretch goals coming at a time when organizations are really challenged on resources and even going through quite deliberate resource reduction, cost cutting type programs, and setting really ambitious stretch goals at the same time thinking that these things might go together. This paper here suggests that they go the opposite direction.
Drew: I think one of the inevitable patterns that I've run across in my career is organization setting stretch goals for efficiency, because they are experiencing a shortfall in resources, and they want to try to recapture some of that margin. They're setting stretch goals for efficiency, and that falls straight into the negative trap. You can't innovate for greater efficiency. At the same time as you're feeling that push, you're going to invest in order to reap those returns.
I don't really know where safety fits quite in this, because an organization could be quite successful in other fields and pick safety as the area that they want to innovate in.
That would actually match the positive pattern in an organization that's doing well in terms of productivity. They recognize a bit of spare cash, they think, okay, let's set some real game changing goals for safety. It would actually make sense with the positive pattern, but it tends to be that organizations with poor safety performance are simultaneously experiencing particularly crunched margins, resource shortfalls, and often poor performance in other areas as well.
David: Drew, we've talked about some of these success stories. There's always a risk of cherry picking these success stories and believing that the conditions that created those success stories can be reapplied to our own situation. I want to talk a little bit about how that might relate to safety. I know you've pulled some quotes out of the paper as well.
Drew: This is just a general warning they give about how businesses learn what's good behavior. It happens in leadership research as well, where we see these apparent success stories that come out of both selection bias and incomplete learning cycles.
For a short period, there's apparent success, so we say that must be a great strategy. What we don't see is what that looks like in the long-term. What we don't see is all those other organizations or other leaders that were doing the exact same thing without becoming a success story, because those don't make the news.
I think this happens particularly in safety all the time. We have a relatively short period when we don't have accidents, and we champion that as a big success story. Hey, come and learn from us because we're doing it well. But there hasn't been any long-term change in the underlying risk. There's just been a relatively short period of no accidents.
Trying to say, oh, that's because of the zero harm, oh that's because of the stretch goal, is a real logical fallacy. We really got to understand these things. Systematically find not just a good set of organizations that happened to have had success and happen to have done zero harm, but find all the organizations that adopted zero harm and see what effect it had on all those organizations over the longer term.
That's really hard research to do because companies that are doing badly don't stick their hand up and volunteer to be part of research into what makes safety successful. So you do tend to over sample.
David: I think the second part in one of these questions, which you might not get to for time, but the coupling of adopting a zero harm, stretch goal, and then having a period of good performance. The authors talk a little bit about dropping a large ocean of organizational initiatives. How do you know which are the things that have contributed?
When we think about safety as an emergent property of the work, then it may be less likely to be the specific safety things that have been implemented compared with other organizational changes or improvements that have changed the way that work gets planned or executed and maybe change the risk.
Drew: This is, I think, the most palatable message for people when you're trying to be skeptical about the evidence for safety initiatives. Someone tells me, I came into an organization, I introduced zero harm, and the organization has been doing really well for the past 10 years.
My question would be, how do you know that the difference was zero harm? How do you know the difference was? You came into the organization. Maybe it's not zero harm, maybe it's just you're really, really good at your job. There are always things like that that we can ask, because no one ever does things in a vacuum. There are always other things they're doing, other things that are going on.
David: We always do practical takeaways. I'm sure our listeners who have got to this point in the episode are really interested to see what we'll suggest here. I know you've got a bit of a caveat before we get there. Do you want to share that? I think it's good for us to just dive into practical takeaways.
Drew: I just want to remind listeners that the authors didn't directly measure any of the effects that they're talking about in this paper. They're extrapolating to logical conclusions based on evidence about how organizations work. David, you and I are extrapolating further to then extrapolate this to zero harm. Don't take this as gospel, take this as ways of thinking about this issue and maybe moving the needle on what you consider to be good arguments and evidence when it comes to things like zero harm.
In particular, this idea that very few strategies are universally good or universally bad, the question is, how do we think it works? And is this the right time and the right organization where we think that this would work? Or is this not the conditions under which we think this would work?
The first takeaway then is there are plausible mechanisms. Where stretch goals, including goals like zero harm, can improve safety? But those mechanisms work when you're in a space that facilitates experimentation, openness to new ideas, and radical change. If that's the space you're in, something like a zero harm vision would go really along with encouraging that thing.
David: I think in my experience recently and over the longer term, that's possibly not the case in lots of companies that have adopted this type of stretch goal in the resources, industries, construction, manufacturing, logistics. They're not intended to be industries that operate in this space of experimentation, new ideas, radical change. I think that's a good first takeaway.
Drew: The second one is that the organizations that should be thinking in terms of stretch goals are the ones that are currently successful. They've got time, space, and other resources.
That goes both ways. If you're an organization that finds itself that has currently free resources or currently seems to be doing well, that's exactly the time you should be trying to shift towards that longer-term rather than focusing all your energy just on maintaining what you're doing now.
David: Thinking of it is like a good to great, like setting a stretch target when you're already good. I liked your point earlier that it may not be just in relation to safety performance. You might be a really good operational performance company that has got safety, maybe not where you want it to be, but you might have good reliability, good productivity, and a bunch of other things. Again, it gives you those foundations to draw on and leverage maybe into the safety stretch goal.
Drew: The third one is I mainly drew thinking around this issue, I guess. Because of the way they talk about when stretch goals work, I think possibly, even if you want to set a stretch goal for safety, expressing it as zero harm might not be quite right. It might be better to express your stretch goal as something that is a bit more specific to your own organization and more about trying to radically change risk exposure.
Radically change the amount of car travel or get rid of car travel. That seems impossible but would be really good for safety if you could do it. Radically changed the amount of work at heights. People in an organization never go into confined spaces. How are we going to achieve that? Or even change the number of hours per week.
We're going to try a stretch goal where we get the same amount of stuff done, and people only need to be at work for 30 hours or four days a week. All of those things would be a positive transformation that gives that idea of an impossible vision that people can see and can try to make possible. Whereas expressing things in terms of zero, I think, is a little bit at odds with that.
David: Drew, I think it's a really good point I was just reminded of. When you were talking about that, I was involved in an organization. We set a target of a 50% reduction in wind screen time, which was around car travel that was very geographic. You would know Western Queensland well. It was a very geographically diverse asset. Lots of people driving to and from very remote areas, and obviously quite a worrying risk of light vehicle–type incidents. The goal was a 50% reduction.
It was one of those things that's impossible, but the organization, I don't know if they've ever quite achieved it, but I found very different ways of working for people to achieve certain tasks. I think that was good.
I added a few extra ones here like something seemingly impossible, but maybe drive performance. I'm just saying, we're going to have two engineering layers of protection for every fatality risk in the company or something like that, where it's just, like you said, seemingly impossible but gives people something to run towards rather than run away from.
Drew: I think that particular one is something that has gone very well with what people were originally trying to get out with zero harm. I think in its early conception, people were trying to get away from this idea. The accident happened, oh, that's inevitable, there's nothing else we can do about it. Having that bad attitude, or every accident, there is something that we could engineer rather than just saying, oh, there's nothing we can do about this. That's the vision.
People have actually done really well in the sustainability space with these stretch goals with things like cutting paper, cutting carbon, cutting energy usage, and really quite dramatically changing infrastructure in the way organizations work to try to reach some of those seemingly impossible sustainability goals. I think it can be done in safety.
David: I'm now going back 20 years, but I was in an organization that changed every printer default to double sided grayscale in the whole company. That couldn't be unchanged. For a moment, I was an incredibly popular person in the company.
We did the type of thing, like radically changed the way that people do things. I won't talk about some of the unintended consequences of something like that, but you're right. I think the environment has used it well. Final takeaway, Drew.
Drew: This is actually repeating something we said in episode 12. I'm interested if you still agree with this point you made back then, which is, I think that if you're in an organization with zero harm right now, or you're having zero harm imposed from the outside through contractual relationships, I don't think it's worth fighting about.
I think the actual wording of the slogan is pretty insignificant. Where there's leverage is in trying to interpret that high level slogan into the type of vision and application that is more likely to get the positive effects and less likely to get the negative effects.
Don't fight having zero harm. Just be clear that zero harm is about radical change. It's about searching for experimenting with new ideas. It's not about knee jerk reactions to each individual event that happens. It's about the long-term, not about maintaining the short-term.
David: I think my opinion here just listening to you say that and thinking back is zero harm might not be the problem. When we read through this paper, and we look at it, they're just talking about stretch goals in general—positive, negative, certain types of organizations that it suits.
If you've got zero harm and you're worried about that stretch goal, thinking that setting a different stretch goal for safety is going to solve the problem, I think this paper would say that's not actually the problem. It's not the stretch goal that's the problem. It's like, do you have the conditions in the environment in your organization that gets the positive benefits from stretch goals in general?
I think if you don't have zero harm, and you think you've got the types of conditions in your organization that could benefit from stretch goals, I'd set a stretch goal for safety, but I wouldn't do zero harm. I'd do something different.
But if you do have zero harm, I'd work more on changing, like you said, the conditions in the organization to try to get more of the positive outcomes rather than thinking that changing the stretch goal itself is magically going to get you all of those benefits.
Drew: Even having zero harm is your indefinite long-term vision and setting your short-term like two-year, five-year strategy. Some of those are more concrete, but also very stretch goals around particular safety risks.
David: Yeah. The question that we asked this week was, when are seemingly impossible goals good for organizational performance?
Drew: I think we have a fairly clear answer here. They're good when the organization is currently doing well enough, currently has a bit of slack resource, and has the willingness to go into a process of genuine innovation, trial and error, systematic learning. Stretch goals are not good when the organization is struggling and trying to turn a corner using the stretch goal.
David: Thanks, Drew. That's it for this week. We hope you found this episode thought-provoking and ultimately useful in shaping the safety of work in your own organization. Send any comments, questions, or ideas for future episodes to feedback@safetyofwork.com.