Goal Setting & Hard Systems in Startups

This thought is based on three separate accounts of ~50 people seed-stage startups. Hence, instead of generalizing, it’s a thought on what doesn’t work vs. what might work.

There are some general truths about startups. Things change fast, they have to adapt, people's duties change, your projects will change, the company you joined is not the same company six months later, etc…

The only constant is change and that constant is accelerated in a startup. Such is its nature that it needs soft systems instead of hard systems.

Soft systems are parameters that bend, more like the guiding principles to constantly change processes around. Hard systems are rigid, most commonly found in large, usually bureaucratic, institutions. It limits their ability to adapt and evolve.

One particular advantage a startup has on the big company is the deployment of the soft system. It’s fitting with its nature. Problems thus arise when a startup starts adopting hard systems.


I should point out a big company can work on soft systems but a small company can’t work on hard systems. If a startup had rigid processes of operations with sequences of processes that were tailored to fit one mold but the business needed to pivot entirely to survive… it wouldn’t work. If your business model will naturally switch over and over again for a period of time….then the adoption of hard systems is stupid.

But adopting hard systems feel safe. Everyone does it. Most schools teach it. Most people from big companies you hire to join startups or inexperienced people who search Google for best practices will use it. But, I think it’s one of the things that will kill the startup eventually.

One particular application is in goal setting. Most companies would probably do better by not having goal-setting practices in the first place. Most seem to really exist so some employees can justify their existence and hide behind using some HR software that doesn’t achieve anything. If you hired driven people they will probably be obsessed with learning anyway.

Some software like Collage has a sliding scale that you can use to ‘report’ you’re 30% on track to meet your goals. I guess if the company was intending to treat the employee like a 5-year-old who needed a ‘good effort’ star…the objective was achieved.

But the greater problem lies with how such startups will make employees set one year or three-month goals. I can see some effort is put into making it a three-month timeline since things change fast. But in many cases, the business is changing month to month and people’s roles will change on a weekly basis at times.

Results matter, but that means it is really important what these goals are. That leaves too much room for error. Once this becomes an official process, people will let insecurity pullover and list out as many goals as they can to show ambition. Just more optical posturing. Wrong incentives.

At best, a goal should probably be limited to one. There are few things that are truly important. If one important thing is done right, it should set the stage for most.

If a product designer sets a goal to build a new mock-up every week, it can include learning new techniques, software, reading about Dieter Rams, watching lectures for inspiration, etc…

Herein lies a process with most goal-setting processes. The hard system gets too specific. It usually makes the goal tie up to the company as it is in the moment. This is nonsense for startups since the company 1 month from now might be a completely new company and all those specific goals are useless. You’d be surprised at how many people in startups complain about this practice.

Given one knows of such rapid change. A goal, if one chooses to make it part of a company process, should be set regarding the individual’s process. It should not be tied to specific projects but on how the individual can work on their practice.

It’s similar to the view of having a compass instead of a map for one’s life. The map is a hard system that relies on a preset plan that one cannot forecast. A compass has general direction but the way is unmapped.

If a product designer wished to become the best designer of consumer apps, then one would need to practice more. Then, the goal needs to be oriented towards more practice or to get to the point of being able to practice constantly.

Such a goal won’t be impacted by how much a startup’s business changes and the individual’s role adapts. The whole point is to set a goal that works on a process one has control over.

It seems that this is not a common practice in startups.