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6. Goals and Objectives

Introduction 1 3 4

  • Goals need to be specific and difficult enough to motivate employees, but not very difficult that they are discouraged 1.
  • Factors that increase the relationship between goals and performance:
    • Goal commitment: whether the person has accepted or is attached to the goal.
    • Goal importance: how important the goal is to the person.
    • Self-efficacy: the belief that the person can achieve the goal.
    • Task complexity: how complex the task is.
    • Feedback.
  • Setting employee goals- 7tips: 3
    • Be specific.
    • Be realistic.
    • Measurable.
    • Deadline-driven.
    • Prioritize.
    • Evaluate.
    • Coordinate.

Goals and Objectives 2

  • Goals are outcome statements that define what an organization is trying to accomplish, both programmatically and organizationally. Try to think of each goal as a large umbrella with several spokes coming out from the center. The umbrella itself is a goal.
  • Objectives are very precise, time-based, measurable actions that support the completion of a goal. Objectives typically must
    • (1) be related directly to the goal;
    • (2) be clear, concise, and understandable;
    • (3) be stated in terms of results;
    • (4) begin with an action verb;
    • (5) specify a date for accomplishment;
    • (6) be measurable.
  • Measures are the actual metrics used to gauge performance on objectives.
  • The goals and objectives in the POLC framework serve as:
    • Gauge and report performance
    • Improve performance
    • Align effort
    • Manage accountability
  • Performance management systems: a process through which companies ensure that employees are working towards organizational goals.
    • (1) Management by Objectives (MBO)
    • (2) The Balanced Scorecard

Management by Objectives

  • MBO is a systematic and organized approach that allows management to focus on achievable goals and attain the best possible results from available resources.
  • MBO involves
    • (1) setting company-wide goals derived from corporate strategy,
    • (2) determining team- and department-level goals,
    • (3) collaboratively setting individual-level goals that are aligned with corporate strategy,
    • (4) developing an action plan,
    • (5) periodically reviewing performance and revising goals.
  • The complete MBO system aims to get managers and empowered employees to implement and achieve their plans, which automatically achieves the organization’s goals.

The Balanced Scorecard

  • It replaces MBO as MBO only focused on financial performance.
  • The Balanced Scorecard is a framework designed to translate an organization’s mission and vision statements and overall business strategy into specific, quantifiable goals and objectives and to monitor the organization’s performance in terms of achieving these goals.
  • 4 areas of focus:
    • (1) Customers => customer satisfaction and retention.
    • (2) Learning and growth => explore the effectiveness of management in terms of measures of employee satisfaction and retention and information system performance.
    • (3) Internal processes => looks at production and innovation, measuring performance in terms of maximizing profit from current products and following indicators for future productivity.
    • (4) Financial performance => the most traditionally used performance indicator, includes assessments of measures such as operating costs and return on investment.
  • The method examines goals, objectives, measures, and activities in the four areas.

Characteristics of Appropriate Goals and Objectives

  • More often you will:
    • (1) set a goal,
    • (2) have a few objectives underlying that goal,
    • (3) have one or more measures for each of the objectives.
  • (1) Less is more:
    • Too many or too few goals can be problematic; just the right amount is needed.
    • organizations should have two to seven key goals.
    • managers should not try to follow any more than 20 measures of performance.
  • (2) Time measures to drivers:
    • Link measures to the factors needed for success (key business drivers).
  • (3) Do not just measure the past:
    • Past, present, and future measures are needed.
  • (4) Take stakeholders into account:
    • The measures that affect all stakeholders should be considered.
  • (5) Cascade goals into objectives:
    • Top-down approach: start with the top managers and cascade down around the organization.
  • (6) Simplify:
    • Consider combining multiple measures into one for simplicity.
  • (7) Adapt:
    • Measures should change with organizational, strategic, and environmental changes.
  • (8) Base objectives on facts:
    • Measures should be based on research methods and not arbitrary numbers.

Personal Balanced Scorecard

  • Recall that the scorecard for an organization:
    • (1) starts with vision and mission,
    • (2) followed by goals (financial, internal business processes, customer, and learning and growth),
    • (3) which have corresponding objectives, metrics, and tactical activities.
  • The personal balanced scorecard has 4 categories:
    • (1) Financial:
      • captures your needs and aspirations about money,
      • and financial obligations that you might have as a result of your role of caring for a parent, sibling, or child.
    • (2) Others:
      • reflect goals that you have in relation to other individuals or society at large.
      • what do relations with your partner, children, friends, employer, colleagues, and others imply for your goals?
    • (3) Individual Strengths:
      • represent the internal perspective, reflecting goals related to your health and well-being.
      • reflect those strengths that you wish to be distinguishing features.
    • (4) Learning and Growth:
      • refer to your skills, abilities, and aims with regard to personal and professional learning and growth.
      • How can you learn and remain successful in the future? What type of skills and learning are required now, for future aspired roles?
  • your personal mission and vision reflect who you are and where you want to go. Personal Mission reflects your values and philosophy of life. Personal Vision captures what you want to achieve.
  • The next step is implementation. One way to think about the implementation of your Balanced Scorecard is through the plan-do-act-dare cycle (PDAD cycle), to be followed continuously.

References

  1. Baran, B. (2012, January 18). Employee motivation: Goal-setting theory [Video]. YouTube. https://youtu.be/_yj2wsPJEWs ↩↩

  2. Carpenter, M., Bauer, T., & Erdogan, B. (2010). Management principles, v. 1.1. https://2012books.lardbucket.org/books/management-principles-v1.1/s10-goals-and-objectives.html ↩

  3. HR360Inc. (2014, October 9). Setting employee goals [Video]. YouTube. https://youtu.be/M2OPEUjBYdw ↩↩

  4. Sinek, S. (2009, September). How Great Leaders Inspire Action [Video]. TEDTalk. https://www.ted.com/talks/simon_sinek_how_great_leaders_inspire_action ↩