While a lot of HR processes will change and alter depending on the size of the company, when you are talking about performance and setting goals for a company, the same issues and risks come up time over time.
Keep It Simple
Keep goal setting simple and to the point for each level of the organization. Work with the simple 4:4 rule – four KPI’s and four competencies. That’s it. Simple! Anything more than that just becomes too difficult to track.
Managers need to drive focus and align their team with understandable and achievable targets. Focus on at least four goals that are important to you and the business, then get your team on-board by cascading it properly. That means talking to them as a team and individually, and not just emailing them the numbers. Second, rev them up by focusing on the skills they need to achieve the targets – their competencies.
This is where the other four kick in. Every manager wants to see improvement in the soft skills of their employees, so competencies are important to track. Arming your people with the right training, tools of the trade, and technology will not only get the job done, but will boost the morale of your team. It will show that you value their development and career path.
Investing in your people drives business results. Empowering them with a good set of competencies and pitting them with each other promotes healthy competition within teams. This also aids succession planning for the organisation. But that’s another topic all together.
SMART (Specific, Measurable, Attainable, Realistic, Timely)
Giving an employee four clear simple KPI’s and four competencies is important but it is equally important that they see these goals as SMART. SMART has been around for ages.
Every year, goals are set and we compose each KPI to be SMART. Yet, our employees do not fully understand it otherwise they will not be in the same vicious cycle of crunching numbers and closing deals at the last hour.
Where do we fumble on this? It is in the Attainable and Realistic part? The numbers do not add up as Attainable and Realistic given the timeframe.
Let’s face it, most companies are revenue-driven, that is a fact. Over and over, companies try and set the corporate goals first, then cascade down the line the same financial goals set at the top. But once you get two or three levels down from the top, you find that management works with a very different set of KPIs from those at the top. A lot of companies fall into the trap of just trying to replicate what is being set above. Goals are set equally not equitably – which is not SMART at all.
Employees are given an equal share of the pie as the pieces of the full business target gets passed on per level. But, business strategies and the business plan are not cascaded properly. Communication barriers from the CEO to the frontline staff happen. Misalignment and disengagement are realities that dampens employee performance.
Top management must realize that goals must be crafted not just top-down but also bottom-up to be SMART. All throughout the annual performance evaluation cycle, it is vital to listen to employees concerns and work with them to achieve their individual and personal goals alongside the company goals. Allowing your employees to plan business strategies with you will make them feel valued and empowered.
Everyone wants to say they are using this SMART framework as it is the latest standard when setting goals, but then a lot of companies want to also create stretch goals. This is when the trouble starts and companies try and set their goals both Attainable andStretch. In my experience, everyone wants to achieve goals, but at the first sign they may not be able to meet them, they will not focus on them and fall into the pit of dismissing. Encouraging and growing your staff is the aim, so ensure you learn from others mistakes and keep it simple.
Giving an employee clear KPI’s that they can see are SMART, will encourage the employees to achieve these goals over any stretch goals that might be set
Know the strengths of your team and use it. Knowing the capacity of your individual team mates will allow you as a manager to leverage on the achievers – your rock stars. They are the employees who will crave for the stretch goals. Know who they are. Encouraging and growing your staff is the aim, so ensure you learn from others mistakes and keep it simple. Layout SMART goals that are attainable, and push employees with realistic stretch goals.