Jianlin Wang, China’s richest man, CEO of Wanda Group

In a recent interview, Jianlin Wang told the interviewer that young people should not be afraid to dream big. He then said, to reach the big goal, you have to “set small achievable goal. For example, make $100 million (RMB)”. This speech had gone viral over the internet.

$100 million, or roughly $15 million, might be a small goal to Mr. Wang. To most people, this is an astronomical figure in terms of money.

In 1993, Jack Welch, former CEO of General Electric (GE) was inspired by how the head of the Japanese railway system on a trip to Japan. In 1855, The chief issued a challenge to build a much faster train across Japan and reduce the slow train system, which could take as long as 20 hours to travel. The railroad engineers were asked to make a brand new design for the next 2 years. The engineers then proposed a train that can travel 70 miles per hour. The chief said 75 mph has absolutely no chance of transforming the nation! So the engineers keep making improvements over the next 7 years.

They added motors to each train cart, reduce friction and all the tweaks to make the train goes faster. After a huge effort of experiments and testing, the world’s first bullet train, the Tōkaidō Shinkansen, was built in 1964. It reduced the travel time of 120 miles from 20 hours down to 4 hours! After that, other bullet trains were built in different cities. The Japanese economy also grew quickly with the ease of transfer.

Six months after the trip to Japan, Jack Welch then set a stretch goal of reducing 25% of GE’s airplane engines defects. And the managers reduced small defects like cosmetic issues to hit the goal. Then Jack went even more aggressive to reduce defects by 70%! The managers started complaining and said there is no way of reaching that goal. Jack Welch gave them 3 years. So the managers started hiring more quality assurance workers, retraining all the employees. The error rates had fallen only by 50%. They started to only hire workers with technical backgrounds so they can spot errors more easily.

To attract great engineers, GE gave employees more autonomy. They could schedule their own shifts and organize teams however they wanted. It decentralized the plant scheduling process. By 1999, the number of defects was reduced by 75%. GE had set a record of not missing a single delivery in 38 months.

To make an innovative change, you have to dream big. Set a goal that is big enough that you cannot reach immediately. Then the key is to set small achievable goals that can actually get you there. Make small improvement from time to time. Don’t be afraid to challenge yourself a little bit above your comfort zone. As long as you have a well-defined plan to reach these small goals, you’ll eventually reach your dream goal.

P.S. the case study above can be found in the book Smarter Faster Better, which I have mentioned in here and here.

Good night New York!