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Dare to Dare! But Not Too Much: The Stretch Goal Paradox

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In our previous newsletters, From Black & White to Technicolor and The Identity Paradox, we uncovered the hidden resources of paradoxes and polarities, both in our environment and within ourselves. We explored a way to be faithful to our core identity and at the same time to cultivate that flexibility that will allow us to grow and learn throughout our life journey. We are starting to understand how our storylines work and how we can avoid being trapped in them, instead of being their master and author and writing our narrative consciously, one word after another.

Now you may feel that you are ready to jump, take the next leap into your future, reinvent a new version of what you know. But hold your horses: you may find yourself in the Stretch Goal Paradox[1].

First of all, what is a “Stretch Goal”? A stretch goal is an objective entailing:

  • Extreme difficulty – stretch goals involve radical expectations that go beyond known capabilities and current performance.
  • Extreme novelty – brand-new paths and approaches must be found to bring a stretch goal within reach. In other words, working differently, not simply working harder, is required.

 

The paradox found by Sitkin, Miller and See in their research shows that, counterintuitively, stretch goals are almost always taken on by companies that are unsuccessful or even on the verge of failure. It may seem incredible given the amount of resources and knowledge that seems necessary to embark in such an ambitious adventure. In fact, the key to the successful achievement of a stretch goal is having:

  • Current record of successes
  • Slack resources

 

These two elements are necessary in order to support experiments and absorb failure. Every innovation, in fact, every new route we take will be paved by failure bricks: things that we tried and didn’t work out but that we learned from and are now showing us the path to follow. Like Dorothy’s golden bricks in the wizard of OZ, they will appear little by little pointing the way towards the castle.

Nevertheless, companies with just one of these elements, or none, are the most likely to try the big shot, even though they’re basically doomed since the start, as they are making an investment they can’t possibly sustain. How come they’re taking this ill-fated risk?

Because we are commonly more prone to take risks when we feel we have nothing to lose. We are so used to the idea of failure that we just try the big leap of faith, therefore choosing the worst possible moment to do it. As Daniel Kahneman and Amos Tversky’s Nobel Prize–winning research has shown, failure puts decision makers in a risk-seeking frame of mind. When choosing between bold action and playing it safe, firms that are struggling usually favor the aggressive path, while success tends to create risk aversion.[2]

The more we have, the more we remain attached to it because we don’t want to lose it, thus missing our best chance at taking a risky but success-bound action: when we are at the top of our game. Like surfers, we shouldn’t try to stand up on our board and make a double loop when we’re already crashing on the beach, instead we should try it when we are on the crest of the wave, the water fiercely supporting us and our balance as firm as it can be.

The Stretch Goals We Give to Ourselves

We find that what is true for companies, is also true for people. We are attached to our Strategies – our usual behavioral patterns or default response mode – as if they were the only certainty we can possibly have, just because they worked in the past. We enjoy the wave of success they brought us and are afraid of losing it if we change something. Once again, success makes us afraid of trying something new.

But it’s exactly while we are riding this wave that we should take the leap. That’s the moment to take a little risk: when our reputation is solid, our morale is high, our confidence is strong, and people trust us. That’s the time when we can experiment and absorb failure, when we can start to act as the person and the leader we want to become.

Don’t wait to wear out your current behaviors that no longer work. This is the case of Rita, an executive we recently coached. Appointed to the head of a new team, Rita was firmly anchored in her usual way of managing things and people. Even though this way was the one that brought her to that position, it wasn’t working anymore in the new context and with that specific group of coworkers. The message was clear, the team was disconnected and unhappy, but Rita kept applying her usual strategy, the only one she was familiar with, without trying to experiment with new behaviors. This rigidity, step by step, wore out her credibility and eroded her colleagues’ support. So much so, that even if at the very end she tried everything to win them back, including a radical makeover of her managing strategy, nothing could work, as the foundation of trust, support and time wasn’t there anymore for her to build on. Lacking the record of successes and the slack resources, the stretch goal was impossible to achieve (and yet, that’s exactly when she tried to achieve it).

So, what would help us dive into new challenges looking for new rewards without falling into the Stretch Goal trap?

  1. Establishing learning goals, not only performance goals. Learning is your golden brick, that will pave the road to the achievement of your more ambitious objective.
  2. Pursuing small wins and small losses. You don’t need a big makeover that will make you feel you’re not yourself. Small changes will give you the freedom to experiment, and through trial and error you’ll see what works for you and your organization, and what doesn’t.
  3. Building slack resources. Stock up on energy, confidence, knowledge and support before taking the next big step – and then do it while you have it.
  4. Having fun! We are not washing machines with a rigid set of instructions. We are a bunch of paradoxes, a union of opposites, we have this AND that and we can mix and match our resources to creatively build ourselves in the way that sounds true to us.
  5. Checking in with yourself. For all of the above, always make sure that it’s in alignment with what matters most to you. Stop, breathe and feel if what you are doing is honoring your core values, and if so, go for it!

Conclusion

General literature tells you to start your leadership journey with a clear sense of who you are. But that can get you stuck in the past. You are bound to evolve as a person and as a leader, encountering new challenges and stretching the limits of what you know — exiting your comfort zone and learning by doing. Growth and change are all around us, and we can’t stop them. So, choose which direction you want to take and…enjoy the ride!

By Anna Gallotti and Selika Cerofolini

[1] SIM B. SITKIN, C. CHET MILLER, AND KELLY E. SEE. The Stretch Goal Paradox. HBR, January-February 2017
[2] Kahneman, D. & Tversky, A. (1979). Prospect Theory: An Analysis of Decision under Risk. Econometrica, 47 (4)

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