Goals are strategic assets. They focus attention, coordinate teams, and measure progress. But goals have a dark side: they can push you to over-persist, ignore better opportunities, and treat anything short of the target as failure.

Management researchers Maurice Schweitzer and Lisa Ordóñez documented the systematic costs: goals create pass/fail thinking, proxy confusion, and inflexibility that interferes with rational strategic adjustment.

The Pass/Fail Problem

Goals are effectively graded pass/fail. You hit the number or you don't. This creates two predictable distortions:

Economist Richard Thaler put it sharply: "If a gold medal in the Olympics is the only grade that passes, you do not want to ever take your first gymnastics class."

Pass/fail thinking converts progress into perceived failure.

A project that achieved 60% of its goal may have created substantial value—but feels like a loss relative to the target.

When Proxies Become Objects

A goal is usually a proxy for underlying strategic objectives. Revenue targets proxy for business viability. User growth proxies for product-market fit. OKRs proxy for strategic progress.

The trap: the proxy becomes the object. You start optimising for hitting the number rather than the strategic value the number was meant to represent.

Proxy Confusion

A team has a goal of 10,000 monthly active users. They achieve it by running aggressive promotions that bring in low-quality users who churn rapidly.

The goal is hit. The underlying strategic objective—building a sustainable user base—is not. The proxy was pursued at the expense of what it was meant to represent.

Inflexibility in a Flexible World

Goals are set based on information available at the time. But the world changes. New information arrives. Assumptions prove wrong. Better opportunities emerge.

If you reran the original analysis with current information, you'd often set different goals—or pursue different directions entirely. But goals persist. They become anchors that resist updating.

"Inflexible goals aren't a good fit for a flexible world."

The "Unless" Solution

The antidote isn't to abandon goals—it's to build in conditional flexibility. Every goal should include "unless" clauses that preserve strategic adaptability.

Examples:

The "unless" is your pre-agreed exit ramp. It protects against pass/fail lock-in, proxy confusion, and inflexibility—without abandoning the motivational benefits of goal-setting.

Building Unless Clauses

Three Categories of Conditions

  1. Market/environment changes: Competitive landscape shifts, regulatory changes, macro conditions
  2. Internal signal changes: Resource constraints, capability gaps, team capacity
  3. Strategy evolution: New information that changes the underlying thesis

For each goal, specify at least one unless clause in each category. These become the kill criteria that preserve strategic flexibility.

Progress Markers

The second countermeasure: deliberately award partial credit. The pass/fail view ignores progress. Counter it by explicitly tracking and celebrating intermediate milestones.

Progress markers convert the evaluation from "did we hit the number?" to "what value was created?"—a more strategically accurate frame.

Goal Audits

Goals should be periodically re-examined against current information. Not "are we on track to hit the goal?" but "given what we now know, is this still the right goal?"

Goal Audit Protocol

Monthly

"Has any unless clause triggered? Is there new information that would have changed the original goal-setting?"

Quarterly

"Given current knowledge, would we set this goal again? Does the proxy still represent the strategic objective?"

Annually

"Should this goal continue to exist? Is it still relevant to strategic priorities?"

The Deeper Pattern

Goals are tools. Tools serve purposes. When the tool becomes the purpose—when hitting the number matters more than what the number represents—you've confused the means for the ends.

The operators who navigate this best hold goals loosely: committed enough to drive focus and accountability, flexible enough to update when conditions warrant. They use goals without being captured by them.

Strategic Exit Series
Part 11 of 14: Navigating Goal-Setting Traps

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This article is for educational purposes and does not constitute business or professional advice. Strategic decisions should be made with appropriate professional counsel.