As a manager, how do I know I'm not making an opposite mistake - confusing action with motion? In other words, how do I know I'm not too hard on somebody? The guy is making dozens of calls, sending hundreds of e-mails, and going to dozens of meetings to get people to write software for my machine with no customer base, but I don't see any concrete results. How do I know it's not my fault for asking him to do an impossible task?
1. It could be an impossible task, but if the company depends on it, then what are you going to do? You can't hang on to someone who isn't delivering the results you need because you don't have infinite time and money. If they are filling a seat that someone better could potentially fill, you and the rest of your employees would be better served finding that better someone and survive.
2. Some tasks are impossible, but most are just hard. Embrace this definition of insanity: doing the same thing twice and expecting different results. If your report is making no headway, quickly as a team accept that, learn from it, and then spend the time to generate new approaches and test those out.
Both approaches are correct. You fire or double down depending on how aligned your report is to positive action. If they are defensive, unwilling, or incapable of learning and experimenting, they are roadblocks. If they are also concerned about their lack of progress, generating ideas, and resourceful, go the distance with them.
Note: it's legitimate for your report to claim that given the resources they have, they cannot meet the target. They can demand from you more resources to meet your goal, or demand you adjust your goal to meet their perception of reality. Then the process works in reverse. Are you defensive, unwilling, or incapable of learning? Or are you concerned about how well resourced you are, resourceful, and willing to go to bat for your report?