Let’s begin with some sad statistics from various sources:
Only 2% of leaders are confident that they will achieve 80–100% of their strategic objectives.
90% of businesses fail to reach strategic goals.
80% of organizations fail to track their business goals.
Only 10% of organizations achieve at least two-thirds of their strategy objectives, with 36% achieving between 50%-67% and 54% achieving less than 50%.
My own experience also shows that companies rarely achieve their long-term goals. It looks like something is wrong with the method. Do we still need a tool that misfires so often?
I believe we do. But we need to treat it right.
Goals as a religious ritual
The idea of goal setting is historically young. There is no evidence that companies in the XIX century, let alone earlier, actively used strategic management with goals, objectives, vision, etc.
Strategic management flourished in the XX century as an applied tool to help leaders make decisions. But it quickly became a religion in the sense that we often follow rituals without delving into their essence.
And nowadays, we take strategic goals for granted. Setting them is equivalent to having good manners in the business environment. If a company doesn’t have long-term goals, its CEO will unlikely admit it in a press interview.
However, goals are always about the future. And to set achievable, reasonable goals, we need a reliable theory of the future.
But can we have one?
A system integrated into another system that is embedded in many other systems
Every company is a system — and a pretty complex one. It consists of processes, hierarchy, culture, and people who are in intricate relationships with each other.
Ironically, large organizations may be successful though no one knows precisely how they work — in all the details.