Targets, Pressure and Metrics

I’ve lost count of the times and the number of people who have told me that you just can’t keep growing at 50% year-on-year. I was told this in 2009, 2010, 2011, 2012, and every year since. The funny thing is that for ten consecutive years we managed to do it, mainly because I set it as our target.

It’s amazing, but once the conversation at the start of each year focuses on, “How do we grow by 50%?” it doesn’t take long for enough ideas to be generated to give you a good idea of how you’re going to do it, how you’re going to stretch just beyond your reach and bridge the gap.

Intuitively, you would think that as a company grows by the same percentage each year, the numbers become harder to achieve, but you will find that the opposite is true. As you grow, your capabilities grow too. Your financial and human resources, your collective creativity, ambition and the number of opportunities in front of you will all grow as well. In a strange way, it becomes easier each year to work out how to hit your stretch goals and ultimately your moonshots.

Overall, we achieved our goals every year for a decade. I am confident that if I had set a specific target of 25% year-on-year growth, then the team would have worked just as hard but only achieved that.

If you’re wondering why I didn’t set a 75% year-on-year target, then aside from giving the team stress-induced heart attacks, remember that a stretch target must be striving for a target just out of reach, but with a vivid awareness of how the gap might be breached.

It doesn’t matter what your stretch target is or whether it’s growth-focused or not. From the outside, it might look like a fluke or luck, but from the inside, you know that if you set a clear, simple goal that is just out of reach, get an ambitious team focused on achieving it, and make every decision based on whether it can help you achieve that goal, then it is perfectly possible to bridge the gap and reach it.

As soon as you get there and right after you celebrate, what is the first thing you should do? Set another stretch target, of course.

What’s important is that your target is directly linked to what you want to achieve. It should be a clear, simple target that everyone understands. It guides your decision-making, is constantly communicated, and is always celebrated when you achieve it or even come close. Every time you hit a stretch target, you move closer to your moonshot.

Two words of caution about fast growth and being obsessed with metrics.

When I spoke about absorbing pressure, I emphasised that you should ensure that you are going through every step of the process to the best of your ability. Metrics should always drive you, but when the pressure becomes too intense, they can become counterproductive.

This is a story I always told my team in the final two weeks of the financial year, when the pressure was getting to the point that it was about to start breaking people.

There is a beautiful run from Australia’s famous Bondi Beach along the clifftops to Bronte. It is one of the world’s most stunning routes, glorified each year with a Sculpture by the Sea exhibition and celebrated at dawn by hordes of people from Sydney’s Eastern Suburbs, who walk and run along it as the sun rises over the Tasman and the world welcomes a new day. It is simply breathtaking.

I used to run it daily. It was a 10 km round trip from my house. As time went on and I became fitter, my rate of improvement diminished.

So, as opposed to the exponential gains I got initially, I had to struggle harder and harder to get marginal performance gains.

At a certain point, I got stuck. I just couldn’t improve my time by more than a few seconds. I varied my training, throwing in strength training and speed sessions. I became increasingly obsessed. I went to bed earlier to make sure my lack of sleep wasn’t slowing me down. Running was supposed to help me sleep better, but the irony was that my stress about hitting the wall negatively impacted my sleep.

Instead of four or five split times, I micro-managed it, shortening each one so I could add five more, giving me ten split times to track in total. There was no part of the run that wasn’t being tracked against my previous split times to ensure I wasn’t slipping. Nothing worked, and I grew increasingly frustrated. My morning run was supposed to help me cope with stress and reduce my cortisol levels, but it was now causing more stress than my bootstrapped business.

Then one day, I couldn’t find my running watch. I totally panicked. Eventually, after ransacking my house, I was out of time and had to get running. There was a kitchen clock, so I could see what time I started and finished, but I wouldn’t be able to track myself against my insane number of split times.

I was also slightly late starting. I usually set off in the early morning darkness and was almost halfway to my turnaround point when dawn broke. As I was so late on this day, I came up onto the start of the path at South Bondi just as the sun rose over the Tasman Sea, picking out the early morning surfers in the waves and painting the world a beautiful rose-coloured yellow on the blue, azure sea. It was stunning.

As I could not look at my watch all the time to check my splits, I started looking up and remembering why this was such a beautiful route. I drank in the views as I wound my way along the coast. As opposed to my usual stressful mood, when I would be endlessly checking my time, I was enjoying myself and remembering why I loved running so much and why this route was so special.

I eventually came back down my street to my front door, feeling more refreshed than I had in weeks. I enjoyed a euphoric feel-good factor and a much-needed endorphin rush.

Imagine my surprise when I opened the door and found I had smashed my time, the same time I had been stuck on for weeks, not by seconds, but by a massive one-and-a-half minutes.

Metrics are good. They track your performance and motivate you to improve. When the pressure is on, though, they can become a block, so focus on the process and, most importantly, remember that you do this because you love it. When you do this, the numbers that were just out of your reach will eventually fall into your grasp.

Bootstrap Confidential: Building from Bedroom to Boardroom Without Investors eBook : Green, Charles: Amazon.co.uk: Books