Written by Ryan Farley

Last updated 27 January 2023 ·

Stretch goals: Finding the sweet spot between too conservative and too audacious

The most successful organisations often achieve groundbreaking results by working towards borderline “ridiculous” goals.

When you give individuals, teams, and departments a goal to work towards, one of three things will happen. If the goal is overly ambitious, employees will burn out. If what you’re asking for is too easy, it’s unlikely they’ll give it their full attention. But what happens when you encourage your people to shrewdly test the limits of their abilities? Employees may achieve something they previously thought impossible and find it the most fulfilling work they’ve done in years.

Although there isn’t a black-and-white formula for creating spectacular stretch goals, there are several shared definitions and strategies among companies that have succeeded the most with this approach. Understanding and applying those insights to your organisation’s OKR process can be invaluable.

What are stretch goals?

Stretch goals are grandiose objectives and desired outcomes. They should “stretch” an individual or organisation beyond what the goal-setter views as realistic. Landing on the moon was a stretch goal (and probably the reason many people use the phrase “moonshot” as a synonym). But launching an astronaut 238,855 miles to the lunar surface took more than just lofty dreams.

Stretch goals are also defined by their dependence on innovative and novel approaches to overcoming obstacles. Neil Armstrong wouldn’t have walked on the moon if NASA had relied solely on brute force and existing technology. He was supported by hundreds of engineers and physicists who invented integrated circuits, freeze-dried food, tyres made of springs, and dozens of other revolutionary components for the mission. Ambition and innovation are the keys to this approach.

When stretch goals with the right ingredients are created, documented, and cascaded effectively throughout an organisation, they can motivate employees, align siloed departments, and trigger breakthroughs. That is, as long as executives introduce them under the right conditions.

When and how to create inspiring stretch goals

An analysis from the Harvard Business Review found that most stretch goals succeed or fail based on two variables. The first was whether an organisation had recently experienced a celebrated win or a painful failure. Announcing a stretch goal soon after a significant misstep was usually perceived as desperate, making employees feel pressured to scramble for solutions. Conversely, when teams felt optimistic and motivated after recent success, they tended to be more deliberate and thoughtful when tackling ambitious goals.

The second variable that increased the chances of achieving a stretch goal was how much time, money, and expertise an organisation had available for experimentation. Suppose you can’t empower your employees with the resources they need to explore unconventional ideas. In that case, it will be difficult for them to push past existing organisational performance and success boundaries.

Once you have enough team morale and company resources to chase after an exciting stretch goal, avoid those based on traditional metrics like profit, market share, and recurring revenue. Those metrics may motivate people in the short term, but stretch goals yield far better results when representing more than numbers in an annual report.

For example, imagine you operate a chain of seaside resorts in Southern England. Making it a goal to open beachfront locations in 2-3 foreign countries might seem an enormous challenge. But it’s not that crazy once you break it down into a five-year plan based on manageable objectives and key results. And during that time, frontline employees dream about putting ‘multinational hospitality company’ on their resume, managers fantasise about international business trips, and everyone takes pride in working for an organisation with a purpose. Everyone wins.

This isn’t to say that well-crafted stretch goals don’t improve the numbers on the annual report. They almost always lead to extraordinary financial outcomes. It’s just that money is rarely what drives employees to stretch themselves. It’s the feeling of pride and fulfilment that comes from challenging and meaningful work.

Need some inspiration for creating goals that motivate your employees? Check out our comprehensive guide to OKR examples for UK businesses.

OKR tools to track and cascade stretch goals

The simple act of documenting and sharing stretch goals can increase success by 33%. In an organisational setting, OKR tracking tools are among the most common ways to create team dashboards that ensure everyone is aligned and focused on the company’s North Star.

If this article helped you create or clarify a stretch goal, now is the perfect time to break it down into objectives and key results you can delegate to your team. We built Reclaro’s 1-3-5® OKR software to do precisely that.

Schedule a free personalised demo today to see how it works.

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