High-performing managers create simple goals, make sure they are clear and transparent, and revisit them regularly. Google, for example, uses an agile goal-setting process called OKR (objectives and key results), which was originally developed at Intel. The process is simple and effective: Each individual (from CEO down) sets ambitious and measurable objectives and are asked to define “key results” that monitor their progress. Everyone’s OKRs are public, so it’s easy to see what the CEO or your peer is holding himself or herself accountable for. At Google, this creates alignment because employees can see who is dependent on their work. People feel comfortable that they know what to do, they see what others are working on, and the measurement of their performance is clear.
Extensive research also found a substantial impact on business outcomes when employees feel vested in their goals and senior leaders create an environment of accountability for goal achievement.
To help organisations turn the principles of effective goal-setting and management into action, Deloitte research identified the following high-impact dos:
- Simplify goals by limiting the number of goals and ensuring they are SMART (Specific, Measurable, Achievable, Realistic and Time-bound);
- Clarify the goal-setting process;
- Enable a platform where goals can be communicated and shared;
- Increase employees’ goal-setting capabilities by allowing them to set their own goals;
- Review and adapt goals frequently, at least quarterly;
- Connect goal-setting and career planning by ensuring goals are integrated with increased learning; and
- Link individual goals to business objectives in order to demonstrate how the individual goals fit into the big picture.
There are unfortunately many don’ts to take into consideration, especially if you are a manager responsible for assisting employees with setting goals. We explore three below:
- Being too rigid or too flexible: An important distinction needs to be made regarding setting and pursuing When setting goals that are rigid, it limits any chance for future change. This can be demotivating especially when considering that people are generally quite poor at predicting future actions or behaviours. However, setting out specific steps to follow in order to pursue the goal increases the likelihood that the goal will be achieved. This insight sheds light on a dilemma often faced by leaders and managers, who have the responsibility for setting and monitoring goals. Too often a leader sets goals and then gives autonomy to teams to achieve them.
- Being over-prescriptive with goals: With goals, people narrow their focus. This intense focus can blind people to important issues that appear unrelated to their goal. The tendency to focus too narrowly on goals is compounded when managers chart the wrong course by setting the wrong goal. Consistent with the classic notion that you get what you reward, goal setting may cause people to ignore important dimensions of performance that are not specified by the goal setting system. Goals inform the individual about what behaviour is valued and appropriate.
- Being too challenging: Research has shown that people motivated by specific and challenging goals adopt riskier strategies and take riskier chances than do those with less challenging goals. People naturally want to achieve their goals. Thus, a potential side-effect of setting goals that are too challenging is people engaging in overly risky or even unethical behaviour to achieve the goals, which could have a detrimental effect.
Bersin by Deloitte (2015). Becoming irresistible: A new model for employee engagement. Retrieved from https://www2.deloitte.com/insights/us/en/deloitte-review/issue-16/employee-engagement-strategies.html.
Grote, D. (2017). 3 popular goal-setting techniques managers should avoid. Retrieved from https://hbr.org/2017/01/3-popular-goal-setting-techniques-managers-should-avoid.
Klau, R. (2012). How Google sets goals: OKRs. Retrieved from http://www.gv.com/lib/how-google-sets-goals-objectives-and-key-results-okrs.
Martin, S., & Mankin, H. (2017). When to set rigid goals, and when to be flexible. Retrieved from https://hbr.org/2017/01/when-to-set-rigid-goals-and-when-to-be-flexible.
Ordóñez, L.D., Schweitzer, M.E., Galinsky, A.D., & Bazerman, M.H. (2009). Goals gone wild: The systematic side effects of over-prescribing goal setting. Harvard Working Paper. Retrieved from https://www.hbs.edu/faculty/Publication%20Files/09-083.pdf.
Smart, A.J. (2015). How over focusing on goals can hold us back. Retrieved from https://hbr.org/2016/03/how-overfocusing-on-goals-can-hold-us-back.