Assess capability and resource margin before setting a stretch target

Stretch goals work when you have enough slack to absorb failure — assess that first.

Why it works

A stretch goal is a high-variance bet: it accelerates learning if successful but consumes resources if it fails. When resources (time, energy, financial buffer) are already depleted, a failed stretch amplifies the deficit. The mechanism for benefit requires sufficient slack to run the experiment and recover from misses — which is a precondition, not an assumption.

How to do it

1. Before setting a stretch target, honestly assess your current resource margin: how much failure can you absorb?
2. If resources are already stretched, set a near-term performance goal to rebuild margin first.
3. Only move to a stretch target once you have a meaningful buffer of time, energy, or capability.
4. Define the stretch as a specific, measurable target with a clear timeline.

Evidence

Sitkin et al.’s critical review found that stretch goals produce positive outcomes primarily for high-performing, resource-rich organisations; for struggling or resource-depleted ones, stretch goals increased dysfunctional risk-taking and lowered performance. (observational)

Much of this research is organisational rather than individual; individual-level boundary conditions may differ somewhat.

Sources

• Sitkin, See, Miller, Lawless & Carton (2011), "The paradox of stretch goals", Academy of Management Review

Common mistake

Setting a stretch goal during a high-pressure or depleted period because "that’s when motivation is most needed" — the research suggests that is when stretch goals most reliably backfire.