Stretch Goals: When They Work, and When They Break Teams

Stretch goals are the part of goal-setting most leaders like in theory and few run well in practice. Set one and a team either finds an approach it didn’t know it had, or it decides quietly that the target was never real. The size of the number rarely decides which way it goes. What decides it is everything around the number: slack in the budget, scoring rules that treat 70% as a good result, a leader who reads a miss as information, and a team that chose the target itself.

This guide covers the research on when stretch goals help and when they backfire. It then shows how we set them as aspirational OKRs that teams own instead of fear.

What are stretch goals?

Stretch goals are targets set deliberately beyond what a team expects to reach with its current resources and methods. They are meant to be missed some of the time, and their value comes from the new approaches a team tries on the way.

In an OKR system, a stretch goal is an aspirational OKR. Its counterpart is the committed OKR, which the team is expected to deliver in full. Our guide to OKR scoring covers the scoring rules for both, and the short version matters here: a 0.7 is a failure on a committed OKR and a success on an aspirational one. Teams that don’t know which kind they are working on will read every partial result as bad news.

The term has a second meaning outside management. Crowdfunding campaigns use “stretch goals” for extra rewards unlocked when funding passes the original target. This page is about the management meaning only.

Do stretch goals improve performance?

Difficult goals do raise performance, provided people have the ability to reach them and stay committed to them. Edwin Locke and Gary Latham’s summary of 35 years of goal-setting research found that the most difficult goals produced the highest levels of effort and performance, and that performance levelled off only when the limits of ability were reached or when commitment to the goal lapsed.

Those two conditions carry the whole argument. Ability is about skill, time, budget and access to decisions. Commitment is about whether the team believes the goal belongs to them. A stretch goal that is handed down from the top, arrives without extra resources and is tied to a bonus tends to lose both at once.

This is why we tell leaders that the stretch is the easy part. “Teams will not pursue bold, meaningful outcomes unless it is genuinely safe to fail while trying.” Without that safety, people protect themselves. They negotiate the target down, or they hit it in ways nobody intended.

When do stretch goals backfire?

Stretch goals backfire when an organization is short on resources or pays people for hitting the number. Sim Sitkin, Chet Miller and Kelly See called this the stretch goal paradox in Harvard Business Review: the organizations best placed to benefit, those with recent wins and slack resources, seldom use stretch goals, while businesses in trouble adopt them in a desperate attempt to turn things around and nearly always fail.

The research on side effects is just as direct. In Goals Gone Wild, Lisa Ordóñez, Maurice Schweitzer, Adam Galinsky and Max Bazerman list a narrow focus that neglects everything outside the goal, a rise in unethical behaviour, distorted risk preferences, corrosion of culture and reduced intrinsic motivation. They argue goal setting should be treated as a prescription-strength medication that needs careful dosing and close supervision.

The best-documented case of what happens without that supervision is a bank. The Consumer Financial Protection Bureau fined Wells Fargo $100 million after finding that employees, spurred by sales targets and compensation incentives, opened more than two million deposit and credit card accounts that customers may not have authorized. The targets were met on paper. The outcome the targets were supposed to represent was not.

The lesson for OKR practitioners is narrower than “avoid stretch goals.” Keep the stretch away from pay, and check the conditions before you set the number.

How are stretch goals different from SMART goals and committed OKRs?

A committed OKR is meant to be delivered in full, while a stretch goal (an aspirational OKR) is meant to be partly missed. SMART goals sit closer to committed OKRs, because the A in SMART stands for achievable.

	Приверженные OKR	Aspirational OKR (stretch goal)	SMART goal
Built to	Be delivered in full	Push past the current way of working	Be specific and achievable
Expected score	1.0	0.6 to 0.7	Met or not met
What a miss means	A delivery problem to fix	Normal, and a source of learning	The goal was not achieved
Where it fits	Customer commitments and launches with fixed dates	New markets or a step change in a core metric	Individual tasks and projects with a known path

The practical rule is that a team should know which column it is in before the quarter starts. Labelling a goal aspirational after it has been missed is not a scoring method. It is an excuse, and teams see through it quickly.

What score should a stretch goal reach?

Around 0.6 to 0.7 on a 0 to 1 scale. Google’s re:Work guide calls 60% to 70% the “sweet spot” for an OKR grade and says that someone who consistently fully attains their objectives isn’t setting them ambitiously enough.

Read the score over several quarters rather than one. A team that lands on 1.0 for every aspirational OKR is setting targets it already knows how to hit. A team that sits at 0.2 quarter after quarter is either under-resourced or setting targets nobody believes in, and both are conversations for the leader rather than the team. The weekly OKR check-in is where that pattern shows up early, long before the quarter closes.

How do you set a stretch goal a team will own?

Let the team propose the stretch and label it aspirational before the quarter starts. Keep it out of compensation and review it every week like any other OKR, so the team learns early whether the new approach works.

Start from the committed baseline. Ask the team what result they could deliver with confidence, then ask what would have to be true to reach well beyond it. The answers to the second question are usually the most useful output of the whole exercise, because they name the constraint, often a missing skill or a dependency on another team.

Check the resources before you check the ambition. The HBR research is blunt that stretch goals work for organizations with slack and fail for those without it. If the team has no spare capacity, the honest move is to free some up or to set a committed OKR instead.

Agree in advance what a 0.7 looks like in concrete terms, so nobody argues about it in week twelve. Keep bonuses tied to other measures. At quarter close, spend as much time on what the team learned as on the score itself.

What does a stretch goal look like as an OKR?

It pairs an objective the team finds meaningful with key results set well above the current baseline, and it is labelled aspirational from day one. The example below is illustrative and not a client result.

Objective (aspirational): Make onboarding the reason new customers stay. Ключевой результат 1: Raise 90-day retention of new accounts from 72% to 85%. Ключевой результат 2: Cut time to first value from 14 days to 5.

The same team might carry a committed OKR alongside it, such as moving every new account onto the new onboarding flow by the end of the quarter. The committed OKR protects delivery. The aspirational one tests whether the new flow changes customer behaviour. Scored separately, each tells the leader something different.

For more on writing measurable key results, see how to write key results.

What else do people ask about stretch goals?

The questions below come from Google’s People Also Ask results for “stretch goals” in the US. Each answer is written to stand on its own.

What is the difference between a stretch goal and a target goal?

A target goal is the level a team plans and budgets around. A stretch goal sits deliberately above it and is expected to be partly missed.

Should stretch goals be linked to bonuses?

No. Paying people for hitting a target they are expected to miss invites exactly the behaviour documented in the Wells Fargo case, and it teaches teams to set lower targets next time.

Are stretch goals a good idea for a company in trouble?

Rarely. The stretch goal paradox research found that struggling businesses adopt stretch goals most often and fail with them most often, because they lack the slack resources that make experimentation possible.

How many stretch goals should a team have?

Fewer than most leaders expect. Keep the majority of a team’s OKRs committed, and add aspirational objectives only where the team has capacity to try something new.

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About the author. Dirk Schmellenkamp is Founder and CEO of the OKR Institute, which has certified 70,000+ practitioners and run OKR implementation programs for 1,000+ organizations across 50+ countries since 2017.

If your teams treat every OKR as a commitment, or none of them, an OKR certification course gives them a shared language for telling the two apart.

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