Set Annual Goals That Advance Your Strategy

His annual goals were actionable, but were they too constraining? 

My client Ed had set a clear, measurable goal to boost employee engagement: schedule quarterly skip level meetings with key employees. It’s a familiar way to access valuable perspectives and make employees feel heard.

And in our executive coaching work together, Ed had been expanding his strategic thinking, mindset and impact. That broader lens caused him to pause to consider - “What’s the higher level purpose and desired outcome I actually care about? Does scheduling 12 quarterly skip-level meetings really help me advance a strategic objective? Or is this an activity that feels clear and measurable, but might not deliver the intended impact?”

It’s a trap many leaders fall into. We set goals to create clarity and focus for the organization - only to end up with  misaligned efforts, or initiative overload. Why? Because annual goals often drift to one of two extremes - either too low (activity-driven to-dos) or too high (vague aspirations with no anchor). It’s a perennial challenge for strategic leaders, translating strategic ambitions into annual goals that are actionable but flexible. 

So how do you keep your team aligned with clarity, without boxing them in with tactics that made sense in January, but are outdated by April?

1.   Set Annual Goals at the Right Altitude

Annual goals are where strategy gets real. But translating long-term strategic intent into day-to-day action is harder than it might seem. I think of it as setting them at the right altitude - not too high or too low. Finding the right altitude is critical: high enough to clarify impact, grounded enough to focus energy (think guardrails), and flexible enough to invite discernment and creativity.

This is where OKRs often get misapplied. The Objective gets inflated (“Be the best place to work”) while the Key Results get reduced to activity checklists (“Hold 12 skip-level meetings”). You end up with a strange combination of too lofty and too tactical - without the clarity needed to drive meaningful progress towards your strategic direction.

A well-formed annual goal should be:

• Strategic - anchored to a longer-term objective defined in your strategic plan.
• Outcome-oriented - focused on what “good” looks like, not just what gets done.
• Directional, not prescriptive- allowing teams to adapt the how while staying accountable to the what.

So instead of: Hold 12 skip-level meetings
Try: Improve employee engagement as measured by eNPS and retention of high-performers

You can still track skip-levels as a supporting initiative - but they’re not the goal. The goal is the impact.

Practice: When setting an annual goal, ask: Is this defining a meaningful outcome - or just describing an activity we hope will work?

2.    The Risk of Setting Goals Too Low  

When strategic leaders set goals that are really activities like “Run skip-level meetings” or “Launch new engagement survey,” they actually constrain creativity and ownership. It becomes about executing an activity, regardless of whether the activity actually contributes to the overarching strategic objectives.

In Ed’s example, the strategic goal was to improve employee engagement. But the goals jumped straight to the tactical level (scheduling skip level training, creating pulse surveys, adding new training) without evaluating each one: for our employees, would this activity actually achieve that goal? Is there something else that would accomplish that outcome more effectively?

The result is a scattershot of well-intentioned activity that sounded great in theory, but actually had diluted impact. Remember that strategic goals should name the outcome you’re solving for - not the list of how you’ll get there. When goals are tied to intent, leaders can adapt their tactics while staying accountable to what really matters.

Practice: Before finalizing any goal, ask: What’s the higher purpose this is meant to serve? If you can't articulate that clearly, you’re likely setting a tactical goal in disguise.

3.   The Risk of Setting Goals Too High

On the flip side, when goals are too aspirational, teams don’t know what’s expected. “Improve culture” or “retain top talent” is inspiring… but what does it mean in practice? You need to bring more strategic clarity - making strategic tradeoffs to focus the team on the approach that best meets your context, to move the needle on those higher level goals.

That’s what Key Results were originally meant to do. Not as task trackers, but as signals of strategic progress and momentum - clear, observable outcomes that indicate whether your strategy is actually working.

The outcome isn’t “Hold 12 meetings.”
It’s “85% of employees report feeling heard and valued by leadership.”
It’s “Regrettable attrition down 20% among top performers.”
It’s outcomes that matter.

Practice: Pair each annual goal with 2–3 outcome-based indicators that define what progress looks like - without prescribing how to get there.

How to Know You’re at the Right Level

The next time you write down your annual goals to advance longer-term strategic objectives, ask yourself:

• Does this goal focus energy rather than disperse it?
• Does it leave room for experimentation and ownership?
• Can teams make real tradeoffs based on this goal?
  

If the answer is yes, you’re probably at the right altitude. If your goal reads like a slogan (“be innovative,” “be a great place to work”), you probably need to come down a level. If your goals are too prescriptive (“schedule quarterly training sessions,”) you risk being active, but not impactful. 

Strategic clarity isn’t about doing more. It’s about enabling better choices. 

That starts with setting goals that guide decisions without dictating the details, and creating space for creativity, learning, and adaptation. 

The Balance That Matters

Great annual goals hold a powerful tension:

• Commitment to a meaningful outcome - so people know what matters and feel accountable to it.
• Flexibility in the approach - so teams can adjust when initial actions aren’t delivering the desired impact.

This is the heart of strategic agility in action. Holding the strategic throughline while adapting with insight. And that’s exactly what a good annual goal enables: a shared understanding of what we’re trying to create, with space to learn our way forward.

Practice: Build in regular review points - not just to check progress, but to ask: Is this still the best way to achieve our goal? If not, adjust to stay anchored to the outcome, not the original plan.

Want to test this in your own leadership? Take one of your annual goals. Zoom out. Zoom in. Rewrite it at the altitude that lets you lead with clarity and agility.

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