Business Goals

Don’t set performance goals alone

Before getting to employee goals, explain to them the company’s strategic direction and your mandate, then ask employees to write an initial list of their goals, writes Dan McCarthy. An honest discussion with open-ended coaching questions can then be used to finalize employee targets.
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Which of these common techniques is most effective for setting annual employee goals?

1. Manager asks employee to write his/her own goals and rubber stamps them.

2. Manager writes the goals and hands them to the employee.

3. Employee writes a draft list of goals and reviews them with the manager. Manager decides which ones to keep, refine, and adds one to two of his/her own.

4. Manager writes a draft list of goals and reviews them with the employee. Employee gives input and manager refines them based on employee input.

5. Manager and employee each write a draft set of goals, they get together and compare, and manager decides which ones to keep.

Which is the correct answer? None of the above is correct because they are ALL inherently flawed. Here’s why:

1. Manager asks employee to write his/her own goals and rubber stamps them. This one is obvious, but it happens all the time. It’s often the result of a manager complying with an HR mandated performance management or goal setting process. It’s lazy management. First of all, the employee is writing their own goals in a strategic vacuum without having the benefit of the manager’s insight into company and department strategy and goals. While writing your own goals is good for buy-in and commitment, a complete lack of involvement from the manager tells the employee that the goals really don’t matter – that it’s just a creative writing exercise that will have little to do with what really matters.

2. Manager writes the goals and hands them to the employee. This technique goes too far in the other direction – high strategic context and manager involvement, but zero employee involvement and low commitment. It’s just human nature to want to have a say in your work – in fact, Daniel Pink’s research says it’s the most important factor in what motivates us. Also, employees will often have the best ideas on how to improve things because they are the ones closest to the actual work.

3. Employee writes a draft list of goals and reviews them with the manager. Manager decides which ones to keep, refine, and adds one to two of his/her own. This is better, as it’s a discussion and collaboration. It still relies on the employee coming up with goals with no direction or bigger picture context. It’s more work and re-work for the employee, without enough involvement from the manager.

4. Manager writes a draft list of goals and reviews them with the employee. Employee gives input and manager refines them based on employee input. Again, this method is better, since there could be discussion and collaboration. In most cases, there isn’t a conversation – most employees won’t speak up and will just accept the manager’s goals, with little thinking or buy-in.

5. Manager and employee each write a draft set of goals, they get together and compare, and manager decides which ones to keep. What I don’t like about this technique is that it can be subconsciously competitive – i.e., who can write the best goals. And again, the manager has an “unfair advantage” of having access to higher level strategy and goals.

While no goal setting process is perfect, here’s more than one that I would recommend that seems to address most of the flaws of the others:

1. Manager reviews company and department strategy.

2. Manager establishes his/her own goals with their manager.

3. Manager has a meeting with all employees to review company and department strategy and his/her own goals. Allow plenty of time for discussion. Manager might refine his/her goals based on input.

4. Manager asks employee to prepare draft set of goals. Given that the employee has a full understanding of higher level strategy and context, and he/she knows his/her own job better than anyone, it should be easy to come up with a pretty good set of goals.

5. Manager and employee meet to discuss. Manager asks a lot of open-ended coaching questions to help the employee clarify his/her goals. The manager does a lot of listening, and only adds his/her own ideas if absolutely necessary. The fact is, according to Marshall Goldsmith, most managers just can’t resist “adding too much value.” They are just compelled to say something like: “Yes, that’s a great idea, and if you did this, it would even be better!” While adding that little enhancement may seem better to the manager, it takes away from the employee’s ownership and commitment to the plan. It’s important that the manager always thinks before speaking and asks, “Is adding my idea really worth it?” In most cases, it’s not.

6. Manager and employee agree on final set of goals.

7. A regular schedule of meetings is established to review progress on goals. Manager acts as a coach in these meetings, helping the employee overcome barriers and maintain their confidence. If the employee is not making sufficient progress on their goals despite multiple coaching meetings, then the manager takes a more directive approach, which could eventually turn into a performance improvement discussion, or even progressive disciplinary action.

Sure, there’s always going to be exceptions to any management process. No two employees are alike. In most cases, when this goal setting technique is used, employees are more likely to establish strategically aligned, relevant goals that they buy into and are committed to achieving.

http://management.about.com/od/managementskills/fl/How-to-Set-Annual-Employee-Goals.htm

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