Do you have an accurate sense of how your company stacks up?
Figuring out a company’s relative performance is ferociously problematic. It depends on which other companies are included in your comparison. Just change the peer group, and a laggard becomes a leader, or vice versa.
And if a company’s relative performance is in doubt, so are its goals, because the two are tightly linked. When Jack Welch was CEO of GE, he famously tasked each business with achieving number 1 or number 2 status in its industry, a goal-setting principle that echoes across the decades.
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