Objective setting is a core element of many performance management processes but too often objectives aren’t actually suitable for various reasons so here are our top tips for objective setting so that you get the best results for all involved.
Why Is Objective Setting Important?
Objectives are important for a number of reasons. From a business perspective, objectives aim to underpin progress and success and as an article on the website Indeed puts it, “Setting objectives helps any organisation grow. It’s a vital process for planning for the future and ensuring a company stays on the right path”. From an employee angle, objectives are also fundamental to the fulfilment of some of our basic intrinsic aspirations, the Harvard Business Review summarises why objective settings can be extremely valuable because this, “motivates us, gives us a sense of purpose, and helps us feel accomplished”.
Understanding the importance of objective setting then is beneficial when it comes to getting the best from the process but beyond understanding how do you actually go about implementing effective objective setting?
Simple & Specific
Don’t overcomplicate your objectives or have multiple objectives which are somehow all intertwined. Clear objectives lead to employees understanding exactly what is expected of them, what success looks like for each objective and how they are going to work towards them in their day to day work. When objectives are specific it is also beneficial for the employee. When the end goal is specific then it is simpler to work backwards from in order to create a plan that employees can progress through in order to achieve the objective. Many companies fail at or make objective setting much more complicated than it needs to be by using language and terminology that staff don’t understand or identify with. Using vague, ill defined corporate speak within objectives leads to employees being uncertain about what an objective actually involves and what the purpose of the objective actually is. By all means link individual employee objectives to overarching strategic objectives. But, an employee should be able to see how they contribute to the wider success of the business and if they can’t because their objectives don’t make sense then employees are far more likely to become demotivated and disengaged by the process.
Measurable & Time Bound
Back in the 1950s V. F. Ridgway wrote a paper entitled, “Dysfunctional Consequences of Performance Measurements”. This was long before data dashboards and reports but Ridgway absolutely hit the nail on the head in saying, “Not everything that matters can be measured. Not everything that we can measure matters”. When it comes to setting objectives then you really need to give some thought to if and how the objectives you set will be measurable. As Ridgway said, “Not everything that matters can be measured”, so it may be difficult or impossible to actually measure something that you feel is important and you want to include as an objective. If that is the case, you need to consider if it is worth having the objective in the first place. If you can’t measure something how will anyone know if the employee has succeeded, failed or is somewhere in between? Once you have decided that you can measure an objective, then how you do that is key. Consider any metrics that can be applied, how the data associated with those metrics is gathered and reported on and how it is shared with the employee. Can they see it in real time, will you show them the data that measures their performance towards an objective at regular intervals with check in meetings and how will you interpret the data? For example, you might set an employee an objective to achieve a 20% increase in sales income within a 3 months period. That objective can be tracked and measured, it can be reviewed monthly and progress can be discussed and actions taken to support performance as and when needed. By having a set timescale the employee also knows how long they have to work on the objective and this helps with planning. If you just set an objective to ‘increase sales income’, then even a 0.01% increase actually means that the objective has technically been achieved and without a timescale the objective is just open ended and liable to drift. You need to be specific, you need to have the correct measures in place and you need to set objectives within timeframes.
Realistic & Achievable
The trouble with some objectives is that they are never going to be achieved and ultimately employees are then being set up to fail. There is nothing wrong with setting challenging objectives. A good way to do that is to set incremental objectives so once the first level is reached and success is achieved then if an employee is outperforming the original objective they can be stretched. By setting this type of objective there is motivation to reach an achievable target and then go beyond. Whereas, if the stretch objective was the only objective, employees would most likely struggle to achieve it and become disengaged and demotivated as they would see it as unattainable. Breaking objectives down and chunking them into smaller, more manageable tasks can make life easier. Employees then see the objectives as being more realistic, they stay focussed and they don’t stress about something that they consider to be out of reach and improbable to accomplish.
Review, Revise, Reward
Once you are up and running with objectives don’t just leave them hanging otherwise, they will lose their importance and value. Make sure that you have regular reviews or check ins with your employees. That could be a simple email or message, it could be a quick catch up over a brew or you could share with them the latest figures so that they know how they are performing in comparison to the objective they’ve been set. Building in review stages to your objective setting and monitoring also allows you the opportunity to revise the objectives if necessary. There may have been a change in the employee’s role or the way the business operates which means that an objective is now redundant or that it needs updating. If that is the case then change it, objectives aren’t set in stone and it is utterly pointless for an employee to be working towards something that will be meaningless. Reviews are also great opportunities to reward and recognise progress towards or actual achievement of objectives. This is really motivating for employees and rewarding and recognising achievement and progress creates buy in, which is great for the employee and the business as well.
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Why not also check out our blog on a similar topic Key Performance Indicators
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