25th January 2017
6 ways to establish employee performance goals
There are a lot of theories on improving employee performance. Some believe setting firm goals and ignoring employee well-being is the best approach. Other’s completely ignore setting goals and focus entirely on making sure the employees feel comfortable. But in reality, neither of these approaches will maximise your employee performance.
Setting employee performance goals in a way that’s inclusive of their personal goals and still benefiting the company isn’t that difficult despite how important it is. Here are 6 ways to improve work performance that we’ve successfully implemented in the companies we work with.
Here are 6 ways to improve work performance that we’ve successfully implemented in the companies we work with.
1. Set goals with your employees — not for them
Performance management is all about seeking the right outcomes and understanding how to steer your staff towards achieving them. Yet, we frequently come across companies who give their candidates massive, ten-page job descriptions that still fail to clearly define the actual purpose of the role. A job description should be more than just outlining activities; it needs to set out expectations in terms of output, results, and any potential changes that an employee is likely to experience on the job.
It’s important you provide clarity on their role as it’s difficult to motivate employees when they don’t feel consulted, heard or given the time understand why they’re doing what they do. A recent survey actually found that 83% of respondents felt their organisation’s goals weren’t transparent enough and that job performance was suffering as a result.
So, before you set your employee performance goals, it’s essential that everyone understands what responsibilities and outcomes are attached to the position.
2. Define areas of responsibility
You need to define the core activities your employee is responsible for. Are they managing the launch of a new product, or are they generating new leads as part of a sales team? What are the exact deliverables you expect from them?
An easy way to approach those questions is by grouping performance goals into 5 or 6 categories, each specific to your business’s core value proposition. For example:
- Sales — Increasing sales volumes by 10%
- Service — increasing the employee’s Customer Service Satisfaction Score to 80% by the end of the next quarter.
- People Leadership — managing the team’s performance to reach 90% of project targets by the end of the fiscal year.
- Marketing — Increase organic leads by 20% each month
- Compliance — conducting a risk assessment audit by the end of the fiscal year.
- Costs — reducing operational expenses by 25% within the next six months.
This provides a solid frame from which you can begin listing all of the tasks, actions, and outcomes that an employee is expected to work to.
Try not to get bogged down with trivial detail (by listing activities like keeping the stationery cupboard neat, or bringing a cake to afternoon tea once a month). Instead, consider which tasks are the most essential to the role.
3. Decide what you need to measure
Setting employee performance goals isn’t just defining the outcomes you expect to see, but agreeing on the metrics you’re using to track them. Will sales performance be measured by monitoring the number of units your employee sells? Or for the amount of revenue they bring into the business?
It’s important to recognise that not all outcomes are easy to measure. A good example is marketing; while it can be easy to track KPI’s when it comes to less tangible goals like brand awareness, things get tricky.
You may need to get creative in identifying the KPIs that work for your business. There’s no need to stick to a traditional structure of spreadsheets and sales figures, so think about other ways your employees are bringing assets to your brand, and how these benefits can be tracked.
Consider search data, website traffic or even user surveys; the main objective of any measurement system is that your information is reliable and relevant.
If a performance goal can’t be measured or is too difficult to measure, then it doesn’t necessarily mean that the goal should not be set. But it certainly wouldn’t be fair to judge an employee’s performance on their ability to reach a lofty goal that cannot be accurately assessed.
4. Set realistic goals
Performance goals must be achievable, or else you could risk losing the engagement and motivation of your employees. Studies have found that employees are motivated more by smaller incremental goals as opposed to ones that seem intimidating, or impossible, to achieve.
Always make sure that the goals you set with your staff are there to challenge and push them to become better, but don’t overwhelm them to the point that they’re frightened to even try.
5. Provide ongoing expectations and feedback
Effective performance management requires setting expectations and goals regularly, rather than just once a year. Once performance goals have been agreed on, you should aim to schedule regular meetings with employees to provide an open, non-judgemental platform where you can both discuss their progress. Offer advice on how to improve performance, but don’t forget to ask what they think of your performance too.
6. Understand their why
What drives your employees? What inspires them? When establishing performance goals, we can’t paint all employees with the same brush. Millennials, for example, will have different priorities to older workers; studies show that up to 60% of millennials are driven by a “sense of purpose” when choosing their employer, above other factors such as money or status.
If you want to get the most out of your employees, understand first how they perceive their purpose, and focus on how you can align the business’s core values to theirs.
Management thought-leader Simon Sinek articulates it perfectly when he explains why managers need to work out what makes their employees tick. Whether it’s making a positive social impact or the potential for career advancement.
As a manager, you need to know why they’re in their chosen role, just as much as they need to work this out for themselves. Having this information on hand means you can better cater to the goals of your employees — and use incentives to achieve them.
Setting employee performance goals requires plenty of preparation before getting down to business. If you’re ready to sit down with your talent and talk shop, we’ve created an easy template to guide you through that process.
Categories: Developing Leaders