CHAPTER 2

Define Employee Goals—and Decide How They’re Measured

As a manager, you’ll take the lead on setting objectives for your team as a whole. Each team member will be working toward these overarching targets, but each individual should also have unique, personalized expectations of their own.

From a purely logical perspective, goal setting should be a top-down process that begins in company strategy and cascades down from the top ranks of the organization—from the president to the VPs to the directors, all the way down the line. This system helps ensure that the goals of any employee in an organization would support their manager’s team goals as well as the organization’s broader objectives.

But the traditional “cascading goal” model has its downsides. When no one is able to set their own goals until their supervisor’s goals have been established—which can’t happen until their manager’s goals are set—employees can feel like mere cogs in a wheel. The cascading model can directly or indirectly signal to your reports that they are truly subordinate, leaving them feeling less motivated than those who have had more ownership and control in setting their own goals. Imposed objectives dictated from on high are unlikely to motivate people as much as goals they had some say in developing. Inflexible, top-down goals can also fail to account for or take advantage of the unique interests, skills, and potential contributions of individuals throughout the organization.

Given this, consider a different approach: Let your direct reports take the lead in setting their goals. Targets that are defined by employees themselves (with managerial guidance and review) engender an important sense of ownership. A person who isn’t invested in the creation of their goals may not have the same level of commitment to achieve them—and a person who isn’t held accountable for results has no reason to take goals seriously. In his HBR.org article, “The Right Way to Hold People Accountable,” leadership advisor Peter Bregman explains, “Accountability is not simply taking the blame when something goes wrong. . . . Accountability is about delivering on a commitment. It’s responsibility to an outcome, not just a set of tasks. It’s taking initiative with thoughtful, strategic follow-through.”

Giving your employees the autonomy to define the details of their goals will help them take responsibility and accountability for the results they aim to achieve. It also helps ensure that they understand both the specifics and the greater importance of their objectives.

You can support your people by helping them understand what the organization’s larger goals and strategy are and what your team needs to achieve. By reviewing and providing input on each objective your direct report suggests, you can help create opportunities that also support each person’s growth and enable their engagement.

Set Up a Performance-Planning Session

In many organizations, new goals are set after a formal performance review, which serves as the natural end of a traditional performance management cycle and the beginning of a new one. Many experts suggest separating the review meeting from the goal-setting process for a more-focused discussion. Since appraisal sessions can cover a wide range of topics from criticism to compensation—and because many review conversations are at least somewhat emotionally loaded—separating out the goal-setting process allows you and your employee to give the conversation due consideration and focused attention. If possible, schedule a separate performance-planning session to discuss the employee’s goals and your expectations.

While your employee may be setting goals for the year in this meeting, it’s possible that those targets will need to be adjusted before the review period ends. In fast-changing industries, the goals you set may not be relevant for an entire year—or even for a quarter. Between constantly evolving technology and a rapidly changing economy, many organizations are becoming more agile; in that context, planning employee goals and tasks a year in advance may not be realistic or accurate. Some companies have replaced annual objectives with short-term ones. At the retailer Gap, for example, employees have quarterly targets; at GE, shorter-term “priorities” have taken the place of annual goals. Recognize that a person’s goals may need to be adjusted or adapted during the year. It doesn’t make sense for anyone to keep working toward an outdated target, so while you should aim to establish long-term objectives, recognize that you may need to meet again to revise or adapt them.

Before you and your employee get together at the performance-planning meeting, ask them to draft a list of goals for the two of you to review together. Give them some pointers about what makes for an effective goal, and review some promising sources for coming up with possibilities. Employees at every level should be able to articulate how their work feeds into the big-picture organizational strategy in addition to fitting with their individual strengths, skills, and ambitions.

Define Goals

When your employee has a list in place, assess their suggested goals. How do they fit into the larger picture? Can you see clear links between their expected contributions and the results they need to achieve as members of your team? Are the objectives realistic and challenging? Do they cover all the elements of the SMART rubric and meet the characteristics of well-defined goals? When reviewing the list, make sure both organizational needs and the employee’s professional aspirations are accounted for.

Aligning goals with those of the organization

Each unit, team, and individual should have goals that directly support the organization’s larger strategic objectives. Such alignment focuses each person’s energy on the work that matters most to the company. Your employee may already understand your team and organization’s strategic efforts, but don’t assume that they do. Take the time now to discuss those efforts in detail. Under standing why a goal is important, on both an individual and an organizational level, will make it more meaningful to your employee.

With these aims in mind, review the employee’s suggested list. Do each of their proposed goals line up with these big-picture efforts? Do they fit within a larger organizational or team strategy? By defining together how their goals can contribute to a larger organizational purpose, their sense of ownership and engagement can grow, and you can begin identifying which of their suggested goals should take priority.

If a target doesn’t match a team or organizational aim, assess whether it’s the right fit. You may be able to revise it to better serve the team or company, or you may choose to remove it from the list altogether. Also, discuss whether there are any goals that are missing from their list that would be important to add from an organizational perspective.

Aligning personal interests with professional goals

Understanding your direct reports at a personal level will help you not only in the goal-setting process but with every facet of performance management. How can the unit goals be crafted to inspire the highest level of enthusiasm and engagement from each person? What are your employees’ career ambitions? Are their professional goals compatible with those the unit or organization must pursue?

By understanding your employees as individuals and learning about their personal strengths and interests, you may be able to help incorporate those elements into their professional goals. Activities that contribute to organizational success can also spur individual employee development—and people can find the intersection of professional goals and personal interests highly motivating.

Ask your team members if they would be comfortable telling you about their personal interests during your performance-planning meeting if their drafted list of goals doesn’t seem to include them. Consider what adjustments can be made to workplace objectives to include those interests. A software developer with a stand-up comedy hobby may not have much opportunity to entertain at work, but if you know they thrive in the spotlight you can suggest them for any speaking opportunities that arise. A goal of delivering departmental presentations or pitching new clients may well suit their interests and skills.

Even employees who share identical titles and roles can adjust certain goals or take on specific tasks that best suit their interests, tap into their strengths, and reflect their personal traits. Your team of three marketers, for example, may share similar goals regarding the new marketing initiative your department is rolling out in the next few months, but each person can also have individually tailored goals that suit their unique interests. If one person likes social media, for example, they might set a goal of increasing the organization’s followers and growing brand awareness on a specific platform. Their colleague with an interest in customer research and focus groups may set out to spearhead new research efforts to better target your department’s marketing dollars, while another team member with a passion for data analytics could aim to analyze your current marketing effort’s reach. By identifying your employee’s interests, you can help them define objectives that let them explore and develop skills that are meaningful to them while producing valuable work results.

Once you’ve taken the time to understand your employee’s strengths and aspirations, look again at their suggested list of goals to see if any align with those traits and objectives. In some cases, you may need to prioritize an organizational mission over a personal aim, but strive for balance to keep your employee engaged, motivated, and growing. (See the sidebar “When Personal and Unit Goals Conflict” for suggestions on what to do when your employees’ aspirations don’t match with unit goals.)

Set a Reasonable Number of Goals

Once you and your report have discussed the list of goals in detail, narrow down the list to a succinct set of objectives to pursue. Even stellar employees can only do so much. A person faced with two goals will probably make progress toward achieving both. But when faced with five, an individual may only make progress toward two or three. Any more than five, and your employee is unlikely to accomplish any, since their attention will be so divided. Instead of burying someone in a flurry of goals, prioritize: Focus on two to four challenging, specific, significant goals.

People can also be overwhelmed by complex and large goals—which is not to say they can’t aim to meet them. It can be helpful, though, to break a goal into smaller pieces, or to set shorter-term aims. Setting monthly or quarterly goals, rather than annual ones, can narrow the focus enough to make the target achievable while still having a big impact.

Establish Ways to Measure Success

Once you and your employee agree on a set of meaningful goals, determine how you plan to assess progress toward each one. List anticipated outcomes and measures for each item.

Metrics provide objective evidence of goal achievement or progress toward it. Sales revenues, errors per thousand units of product, and time to market for new products are all clear examples of metrics that can be linked to goals, since they can be easily quantified.

It’s worth noting, however, that not every goal can be easily measured, and you can fall into traps while establishing metrics. Keep the following pitfalls in mind as you define how objectives will be evaluated.

• Missing metrics. Some goals may not be obviously connected to clear performance metrics. “Increase unique visitors to the website by 5%” is simple to measure if you know the starting point, but a goal of “increase engagement on social platforms” is trickier to quantify.
• Choosing the wrong metrics. Not all that can be measured is equally important or worth targeting. While it’s great to increase the number of customer complaints resolved in a given time period, it may be better to focus on reducing the number of complaints overall.
• Overemphasizing metrics. Performance is a combination of two factors: behaviors and results. If results are the “what” of performance, behaviors are the “how.” Noting the behavior and work behind a specific goal is just as important as the metric itself, even if it’s not easily quantifiable. Helping a colleague who’s facing a tight deadline or coaching a new member of the team is unlikely to fit into anyone’s formal goals, but such actions deserve recognition and acknowledgment.

When goals aren’t easily quantified

Some goals are more qualitative and therefore harder to measure. In such cases, you should still be able to pinpoint tangible, measurable targets within them. If you’re struggling to find a suitable unit of measure, set a more specific, metric-friendly goal targeting something that can be measured. Someone whose goal is to improve their public speaking skills may set a target of making six public presentations in the upcoming year, with the understanding that there will be a follow-up meeting to discuss that performance and ways to improve after each. Or, if your employee is tasked with increasing innovation, a suitable target might be to propose three new ideas to the department in the next six months or to meet certain deadlines for specific stages in a project’s development.

Determine in advance how you plan to measure progress for each goal, whether it’s a numerical or time-based target. Be specific: If you were evaluating an individual who wanted to improve their public speaking, you might want to agree on how you define “public presentations.” Are they presentations to the department, to the organization as a whole, or outside the company? Additionally, define ways to measure engagement and people’s reactions to determine if the speech was considered a success.

While goals and metrics are hugely important, they are not the be-all and end-all of performance management. Don’t make the mistake of dismissing what you can’t quantify. When it comes time to assess an employee’s performance, you’ll want to look beyond simply measured aspects.

Establish Expectations, Not Just Goals

When you discuss objectives with your employees, you should also talk about what you expect of them in terms of behavior. Your direct report may understand what they must achieve, but if they do so in a way that’s detrimental to your team or the organization, their contributions won’t matter.

Talk through your expectations for citizenship behaviors—like stepping in to help colleagues in need, serving as a resource for others, cooperating and demonstrating flexibility, and training new hires—as well as basic competencies like behaving professionally in the office and arriving to work on time. How individuals contribute to organizational culture may not fit into a goals framework but is still essential to achieving strong performance. Understanding behavioral expectations is important to creating a collaborative and productive work environment—and you should make it clear to your employees that you value their contributions and cooperation on this front as much as you do their work results.

When you make your expectations clear from the outset and your employees understand how they’ll be evaluated, performance improves. Plus, making expectations explicit helps hold employees accountable.