Does Goal Cascading Still Work?

The Mesh Team
Published on 
Apr 27, 2023
Cascading goals reduces agility, collaboration, and bottom-up innovation. It's time to switch to a better goal-setting model with OKRs.

Curb Your Enthusiasm has no shooting scripts—only outlines. No dialogues mean actors improvise on the set with the outlines acting as guides. And that's what makes the HBO show, now in its eleventh season, unique and successful—without a top-down script.

Businesses also have their version of TV scripts: cascading goals. At the start of each year, senior executives get together and decide the company's objectives for the following year. They pass the objectives down to the next rung, who then set their goals, and so on. The cascading continues until it hits the bottom of the corporate ladder: front-line employees. It could take months, but in the end, everyone's got their scripts.

However, that century-old practice of goal-setting produces shows that tank at the box-office of reality. Cascading couldn't keep up with the changing pace of business, modern work environments, and employee expectations. Lack of transparency, playing it safe while setting goals, and work becoming rote box-checking exercises—to name a few of the problems. One Mesh customer told us that while they were cascading down the goals, the quarter was already over. No wonder Harvard Business Review urged managers to avoid cascading goals.

What are cascading goals?

Cascading goals are a type of goal setting in which each successive goal is dependent on the successful completion of the previous goal. In other words, each goal "cascades" into the next, like a waterfall.

This technique can be used to achieve both short-term and long-term objectives. For example, if your long-term goal is to become a manager, your cascading goals might look something like this:

1. Get promoted to senior level within your current company

2. Become certified in management

3. Start your own management consulting firm

Cascading goals can be an effective way to achieve complex objectives because they help you break down a large goal into manageable steps. This can make the goal feel less daunting and increase your chances of success.

It's important to note that each goal in a cascade should be specific, measurable, achievable, relevant, and time-bound (SMART). This will help you stay on track and ensure that each goal is helping you move closer to your overall objectives.

Why cascading goals are important

There are a few reasons why cascading goals are important:

1. They help you focus on the most important task at hand. When you have a long-term goal, it can be easy to get bogged down in the details and lose sight of what's most important. Breaking the goal down into smaller, more manageable steps can help you stay focused and avoid getting sidetracked.

2. They keep you motivated. Having smaller goals to achieve along the way to your larger goal can help you stay motivated and excited about what you're doing. Each time you complete a goal, you'll feel a sense of accomplishment that will spur you on to the next one.

3. They increase your chances of success. When you have a plan for achieving your goal, you're more likely to actually achieve it. Cascading goals can help you create that plan and increase your odds of success.

4. They help you identify roadblocks. If you find that you're having trouble achieving one of your cascading goals, it can be a sign that there's a problem with your overall strategy. Identifying these roadblocks early on can help you make adjustments to ensure that you eventually reach your destination.

5. They force you to think long-term. In today's fast-paced world, it's easy to get caught up in the short-term and lose sight of your long-term goals. Creating cascading goals can help you stay focused on the future and ensure that your actions today are helping you achieve your long-term objectives.

How to create cascading goals

There are a few things to keep in mind when creating cascading goals:

1. Start with your long-term goal. The first step is to identify your long-term goal. This will be the goal that all of your cascading goals lead up to.

2. Break the goal down into smaller steps. Once you have your long-term goal, start breaking it down into smaller, more manageable steps. These will be your cascading goals.

3. Make each goal specific, measurable, achievable, relevant, and time-bound. Remember to make each goal specific, measurable, achievable, relevant, and time-bound (SMART). This will help you stay on track and increase your chances of success.

4. Create a timeline. Once you have your cascading goals in place, create a timeline for each one. This will help you stay organized and ensure that you're making progress towards your overall goal.

5. Adjust as needed. Be prepared to adjust your goals as needed. As you start working towards your objectives, you may find that some of your goals are no longer relevant or achievable. Don't be afraid to make changes to ensure that you're still on track to reach your destination.

Challenges of cascading goals

Goals drive strategy execution. In 1990, two goal-setting pioneers, professors Edwin A. Locke and Gary P. Latham, published a groundbreaking book summarizing decades of their research. They found that there's an inseparable link between goal setting and workplace performance. Locke and Latham recommended leaders set ambitious targets with metrics, make them transparent, and give continuous feedback. Cascading is the exact opposite of what Locke and Latham suggest.

Like anything, there are some challenges associated with cascading goals. Here are a few things to keep in mind:

Lack of transparency

A Harvard study says that "only 7% of employees fully understand their company's business strategies and what's expected of them in order to help achieve company goals."

In the cascading model, employees can't see the company's top-level goals. That prevents them from aligning their individual goals to those of the company. The result: reduced engagement, mediocre performance, and limited cross-team collaboration.

That's one reason why companies such as Amazon, Google, GE, and Samsung are adopting OKRs. Having goals transparency built in gives OKRs an edge over other goal-setting frameworks. Learn more about OKRs here.

Not flexible enough

In today's globalized world, businesses have become more complex and fast-paced. Disruption is happening everywhere, uprooting incumbents and upending entire industries. Companies need to be more dynamic and match their goals with the evolving realities of the day, which cascading doesn't allow.

Goal cascading happens once a year and takes months to trickle down the corporate food chain. It's tough, and in some cases almost impossible, to change the company's direction and course-correct individual goals on the fly.

SMART doesn't stretch

"I'd rather have the objective be to go to Mars, and if we fall short, we'll get to the moon," Google co-founder Larry Page often says. Stretch goals allow companies to go beyond incremental progress and come up with revolutionary products. They motivate employees to stretch outside their comfort zones, take on risks, and deliver exceptional performance. Locke and Latham agree: "90% percent of the time, challenging goals led to higher performance than easy ones."

One of the most popular frameworks that managers use to set goals during cascading is SMART: specific, measurable, achievable, relevant, and time-bound. If employees hit those "measurable" and "time-bound" goals, they get the incentives such as compensation and promotion. The problem with SMART is that it encourages employees to sandbag by setting easy to achieve targets and nipping stretch goals in the bud. A survey by Donald Sull of MIT Sloan concluded that two-thirds of managers would advise a new colleague to play it safe. Goal cascading, when used alongside the SMART framework, deprives companies of creativity and innovation.

Reduced engagement

The whole purpose of having goals is to improve employee performance. So it makes sense to involve them in the entire process. Doing that also makes them feel valued and motivated. Securing employee buy-in translates to increased engagement thanks to the IKEA effect, more ambitious goals, and better performance.

But goal cascading doesn't allow employee involvement in goal-setting beyond the narrow objectives set by their managers. When top-line executives don't have input from on-ground employees, many great ideas die before seeing the light of the day. Employees find it demotivating not to have a say in how they can better contribute to organizational goals, reducing their engagement and performance.

Lack of autonomy

In the forces, Commander's Intent allows lower-ranked soldiers to solve problems in real-time using creativity. In the business context, that "intent" translates into a company's objectives and the ability to solve problems with creativity into autonomy. Setting their own goals not only boosts employee performance but also frees them to explore new creative ways.

With cascading goals, there's no such thing called Commander's Intent. All the employees can do is to toil in a spiritless manner to hit their goals.

Limited collaboration

Collaboration among employees and teams is vital to employee engagement, innovative breakthroughs, and driving the company's performance. Goal cascading's lack of transparency means employees have little or no idea what other teams are working on. It creates a siloed work environment that discourages the exchange of ideas and teams coming together to solve a business problem. When there's limited collaboration, employees may hit their targets, but there's little innovative output.

"Having goals improves performance. Spending hours cascading goals up and down the company, however, does not... We have a market-based approach, where over time, our goals all converge because the top OKRs (goals and metrics) are known, and everyone else's OKRs are visible." says Laszlo Bock, former head of People Operations at Google, in his book "Work Rules."

Today, cascading goal-setting is like internal combustion engines: Inventors of both were born in the nineteenth century. The world has changed a lot since then, leaving them both beyond improvement. Just as electric vehicles replace internal combustion engines, companies need to shift from cascading goals to transparent, bottom-up, and meritocratic models. We recommend switching to OKRs.

Beyond cascading SMART goals is the land of motivated employees, breakthrough innovation, and better business results. And now is time to move.

Incorporating cascading goals into your organization

If you're interested in incorporating cascading goals into your organization, there are a few things to keep in mind:

1. Make sure everyone is on board. The first step is to make sure that everyone in your organization is on board with the idea of cascading goals. This includes upper management, middle management, and front-line employees.

2. Train your employees. Once you have buy-in from everyone in your organization, it's time to train your employees on how to create and work towards cascading goals. This training should include both classroom instruction and hands-on experience.

3. Implement a system. Once your employees are trained, it's time to implement a system for setting and tracking cascading goals. This system should be simple and easy to use.

4. Evaluate regularly. Finally, make sure to evaluate your cascading goal system on a regular basis. This will help you identify any areas that need improvement.

Mesh helps companies empower their teams and boost performance with OKRs and continuous feedback. Interested in knowing how Mesh can help you upgrade your goal-setting from cascading goals to OKRs? Speak to us today.

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About the Author

The Mesh Team is a diverse group of passionate professionals at Mesh, dedicated to transforming the world of performance management. Together, we aim to provide you with valuable insights, strategies, and knowledge to empower your journey toward achieving exceptional performance in your organization.
The Mesh Team
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