Summary
Goal Setting: Ambitious goals fail without an operational contract. Filling out HR forms with vague targets wastes time and kills commitment. Learn how to separate the end point from the right to define the path, agree on clear feedback, and secure the resources needed to turn a goal into a binding agreement.
The wording is not what gives a goal its value. The contract built around it is.
Goal agreements in most companies get written in October and November, shortly before the form is due with the HR department. That is precisely why they fill up with sentences that hurt nobody and move nobody forward. A goal that fills a form costs time and produces nothing.
This article is written for you if you are formulating targets for 2027 over the coming weeks, for yourself or for your team.
It applies equally if you receive figures from above that your role barely touches and you are expected to sign them anyway.
The argument up front: a goal takes its value from the contract around it rather than from its wording. Working only on the wording produces precise sentences without effect. The system behind it sits on the SMART method page, and the conversation structure sits on the GROW method page.
The Most Valuable Goal of My Career Was Empty at First
The Assignment That Started Everything
My manager at the time gave me the assignment to examine where in Eastern Europe an electronics department could be founded and built. Among the locations I examined were Poland, Slovakia, Czechia and Romania, along with several others. It covered framework conditions, costs and the question of whether the right people could be found there at all.
The Preparatory Work Was Demanding and Still Simple
I clarified with local universities whether the job profiles matched the qualifications on offer and how many graduates reached the market each year. That work was straightforward to deliver because the questions were clear. Tasks of that kind have a beginning, a path and a result, which is exactly why they are not the point where things get difficult. Sorting that kind of work is covered in the article on team commitment.
Then the Decision Came, and With It the Real Question
The CEO decided on Slovakia, I accepted the director position, and then I asked the obvious question: how many people should I build?
I received no answer. What came back instead was a counter-question: what do we need?
At That Point There Were Two Roads
I could have read that as evasion and done something arbitrary, pointing out that nobody had given me a number. That stance would have been comfortable and would have delayed the build-up by months. I chose the other road and took the question for what it was, namely an assignment.
What I Did Instead
I networked with every division head, derived the actual demand from those conversations, developed positions and roles out of it and submitted each proposal for approval individually. That was considerably more work than executing against a given number. It was also the point at which I learned to think strategically, a shift described on the mentoring page for directors.
I Did Not Get Every Role
Some positions I had to fight hard for and justify, because the business case had to hold. That very argument was the valuable part, since it tied each role to a purpose. In the end I could build the department around a demand I had examined myself and agreed jointly.
Why That Empty Goal Worked
The end point was clear, nothing inside the goal was defined at first, and it carried anyway. It worked because my manager formed his picture through very good questions in our reviews without controlling me. Across four years I never experienced the slightest trace of micromanagement from him. He let me run, and run I did. How quickly that flips once control enters is described in the article on overcoming micromanagement.
And What Sat in the Goal Form at the Same Time
Company leadership handed us directors mandatory goals, among them EBIT and quality costs, along with a series of further terms. What stood there was a goal cloud: plenty of buzzwords, and nowhere a derivation of what the person holding that cloud in their form is actually supposed to contribute. It was never followed up, it simply sat in the document. The goals I developed myself and agreed with my manager, by contrast, moved the department forward, and that package also contained training for my own development.
How I Have Measured Goals Ever Since
A goal acquires value once both sides agree it bindingly and fully own it. Whether it is a classically worded target, a development goal or something else matters less than whether somebody stands behind it. The opposite of that is the phrase do a good job. It contains no requirement, no definition and therefore no commitment.
No sales conversation. If I am not the right fit, you will hear that within the first five minutes.
What the Research Says About Goals, and Where It Gets Uncomfortable
Demanding Goals Work, and Work Considerably
Locke and Latham brought together more than 400 laboratory and field studies. The result is unambiguous: specific and difficult goals produce higher performance than vague appeals such as do your best. Difficulty and performance move together in a linear relationship until the limit of ability is reached. That makes the phrase do a good job not merely imprecise, it is demonstrably the weakest of all variants.
The Qualifier Almost Every Summary Drops
That relationship holds only under conditions: the person has to have accepted the goal, has to possess the necessary ability and must not be pursuing conflicting goals. Locke and Latham name five conditions in total, namely clarity, challenge, commitment, feedback and fit with task complexity.
This Is Exactly Where SMART Has a Gap
SMART covers clarity and partly the challenge. Commitment, feedback and fit with task complexity do not appear in the formula at all. That explains why a technically well-worded goal can still remain ineffective, and it explains my goal cloud too: the metrics inside it were measurable, only nobody derived which contribution was expected from me.
The Counter-Position Worth Knowing
Ordóñez, Schweitzer, Galinsky and Bazerman described systematic side effects of goals in the Academy of Management Perspectives: a narrowed focus that neglects other areas, distorted risk preferences, more unethical behaviour, inhibited learning, erosion of culture and declining intrinsic motivation.
Their image for it is blunt: goals act like a potent prescription medication and should not be handed out like a harmless remedy from the shelf.
That Debate Is Not Settled
Locke and Latham published a rebuttal in the same journal, and the exchange is on record. For practice the dispute matters less than the common ground: an ambitious goal produces a strong effect, and the direction of that effect depends on the conditions you set around it. Those conditions are what I call the operational contract.
What This Means for Your Goal Round
When you write goals over the coming weeks, the wording is the smaller part of the job. The larger part consists of establishing commitment, agreeing feedback and settling the resources without which nobody can reach the goal. A goal missing those three points is a promise somebody else is expected to keep, which is how the pattern in breaking down silos usually starts.
Five Steps to an Operational Contract
1. Separate the End Point From the Right to Define
Settle first what is fixed and what you are allowed to shape yourself. In my case the end point was fixed and the design sat with me, and that split was precisely the opportunity. When both remain unclear, what emerges is not freedom but a trap, because every decision gets renegotiated later.
2. Derive the Demand Yourself Rather Than Waiting for a Figure
If no number arrives, fetch the number from the organization. Talk to the neighbouring areas, derive the demand and submit it for approval. That round costs weeks and replaces months of discussion, as described in the article on escalation management.
3. Put the Contract in Writing, Not Only the Goal
Every goal needs four entries: which resources are available, which decisions you may take alone, which areas you depend on and what happens when conditions change. The last point is missing almost everywhere and matters most, because without it a goal survives even after its foundation has disappeared.
4. Agree Feedback Without Agreeing Control
Define the rhythm of your exchanges and the questions they run on.
My manager formed his picture through very good questions and never controlled me while doing it. That difference can be learned, and how it looks in a conversation sits on the GROW method page and in the article on open-ended questions.
5. Translate the Goal Cloud Into a Contribution
Targets from above do not disappear because you ignore them. Write one sentence per prescribed term naming your own contribution to it, and put that sentence in front of your manager. Whatever resists translation into such a sentence does not belong in your agreement, a discipline related to leading without authority. Include your own development in that package, because otherwise nobody writes it in.
You leave with a formulation, not with a proposal.
Voices From Practice
Goal Conversations & Strategic Direction
Vinayak Gaddam was Deputy Manager at Brose India and describes exactly the outcome a good goal conversation aims at: clarity and a stronger sense of direction.
His guidance consistently helped leaders gain clarity, confidence, and a stronger sense of direction in their roles. Andy has a unique ability to simplify complex leadership situations and offer actionable guidance tailored to individual needs. His mentoring style is both supportive and challenging, encouraging self-awareness and better decision-making.
Vinayak Gaddam, Deputy Manager, Brose India Automotive Systems
Gaining Objective Goal Clarity Beyond Reporting Lines
Radha Krishna Nemani works in vehicle safety and sought coaching outside his own reporting line. His feedback belongs here because clarity about your own goal rarely emerges on its own.
I had the opportunity to have coaching from Andy. He has wide experience of building and developing global teams as a corporate leader. He is very good at understanding the needs and perceptions of individuals and accordingly steering the discussions. I am very thankful for insights and clarity achieved through the coaching.
Radha Krishna Nemani, CAE Crash and Safety, Brose
Strategic Prioritization
Gauri Gole worked with me across several years on training initiatives. Her assessment belongs at this point because the hardest task in a goal round is not the writing, it is the discarding.
I’ve had the pleasure of working with Andy over several years on multiple training initiatives and related engagements. His strategic thinking, forward-looking approach, and ability to identify what truly matters make him a pleasure to work with. Andy brings clarity, trust, and genuine partnership to every collaboration.
Gauri Gole, Entrepreneur and Service Provider for Engineering Education
FAQ: Frequently Asked Questions on Goal Setting
Q1: What makes a goal valuable?
That both sides agree it bindingly and fully own it. The wording is the smaller part; what decides is commitment, agreed feedback and the resources needed to reach it at all. A goal only one side signs is an expectation rather than an agreement.
Q2: Are SMART goals outdated?
No, they simply cover less than many people assume. SMART delivers clarity and partly ambition. Commitment, feedback and fit with task complexity are absent from the formula, although Locke and Latham identify them as decisive for the effect. The full system sits on the SMART method page.
Q3: OKR or SMART, which suits an engineering department better?
They solve different problems. OKR aligns goals across areas and works in short cycles, SMART sharpens the individual goal and its measurability. In practice the method rarely fails, the missing contract around it does, which is why switching frameworks alone changes little.
Q4: What do I do with a goal cloud of metrics I barely influence?
You derive one sentence per metric naming your concrete contribution, or you strike it. That derivation is missing from most targets, and without it a metric stays a buzzword. Alongside it you agree two or three goals that genuinely move your area forward, avoiding the mistake of massaging the figures, because Ordóñez and colleagues describe exactly that behaviour as a documented side effect.
Q5: What about sites Q5: How many goals make sense?
Few enough that you can list them without looking them up, usually three to five. More goals produce selection in daily work rather than alignment, and that selection then gets made by your calendar. How to sort them sits on the Eisenhower prioritization page.
Q6: Can an imprecise goal still work?
Yes, under one condition: the end point has to be clear and the right to define has to sit explicitly with the person delivering. My build-up goal in Slovakia was constructed that way. Without that explicit transfer, an imprecise goal is merely a gap that gets closed later at the expense of whoever delivers.
Q7: How do I recognise a goal that only fills a form?
By three signs: nobody has mentioned it since the conversation, no feedback rhythm was agreed, and nobody could say which resources stand behind it. When all three apply, it is not a goal, it is an entry.
Q8: Do development goals belong in the same agreement?
Absolutely, otherwise they never happen. I deliberately put training into my own goal package, because it would always have lost out to the project situation. For leaders in that position, mentoring from expert to leader is a fitting frame.
Q9: What do I do when conditions change during the year?
You reopen the agreement rather than letting it fail quietly. That is why every goal contract needs a sentence about what happens when conditions change. Without that sentence the year ends with an assessment nobody considers fair.
Q10: How do I run the goal conversation itself?
With questions rather than with instructions. The most effective sequence is to settle the end point, then hear the other person’s proposal, and only afterwards bring in your own conditions. The GROW method provides a reliable structure for that.
Q11: When is external support worth it?
When you sit between the target from above and your team, and both sides expect something different from you. A neutral counterpart separates form obligation from effective goal faster in that position. The formats for it are executive coaching and Accelerate Now.
About the Author
Andy Balbus spent 25 years in the automotive industry, most recently as Director Electronics in Prievidza with forty engineers and as Senior Manager in Pune, carrying a project budget of 15 million euros and revenue accountability of 150 million euros.
As an ICF PCC certified coach with more than 1,000 coaching hours he works with leaders across the DE-SK-IN matrix.
Three worlds that rarely meet in one person: operational accountability for goals with a real price tag, professional coaching training and four years in Slovakia plus two years in Pune as an accountable executive. What a goal looks like when it holds, he learned by building a department out of nothing, and that is the perspective you get in the conversation linked below.
Results or Excuses
Over the coming weeks you will sign goals that define your 2027. Treating them as a form leaves you twelve months later with an assessment without substance and a team that has learned agreements carry no consequences. Clarifying the contract behind them gets you resources, decision rights and feedback worth the name. In thirty minutes we settle which of your goals actually produces an effect, which resources are missing for it and which sentence you take into the conversation with your manager.
Enter the year with a goal that holds instead of a form: 30 minute Reality Check
One calendar link, no preparation required.
More on how I work sits on the page about Andy Balbus, in the leadership case studies and in the glossary. Related reading: setting boundaries as a leader, no time for strategy, functional vs disciplinary leadership, developing executive presence and stabilizing a team after restructuring. For delivery, uncompromising delegation, the Team Charter Workshop and mentoring for team lead scaling are the practical next steps. If your build-up sits in Slovakia, executive sparring Slovakia is the next move.
Systematic Leadership does not end with a phone Call.
Follow Andy for more Perspectives and Insights.
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