Setting Goals and Follow Up (Performance Management 2/2)
This is the second half of an article on managing performance. In the first part “Equipped to succeed” we looked at creating the environment for performance, one in which people feel that they belong and to which they can bring their whole authentic selves.
In this article we’re going to zoom in on managing a specific task or project.
SMART goals and lead and lag indicators
Most people reading this article have probably heard of SMART goals, but I’ll recap just in case. ‘SMART’ is a mnemonic for the key dimensions of a goal:
- Specific — precisely what are we setting out to achieve?
- Measurable — how will we know we have achieved it?
- Achievable — is the goal feasible?
- Relevant — how does the goal contribute to the organisation?
- Timebound — what is the deadline for achievement of the goal?
When you’re setting a goal in consultation with your team, you might like to to think about lead and lag indicators. The goal might be to increase sales by 25% over the coming year. This is a lag indicator: you’ll know if you’ve achieved it when you look at the sales figures.
Of course progress towards the goal can be tracked over the year, but you might also want to consider the levers that you need to pull en route and have some lead indicators, particularly if there is a time delay between taking practical action and delivery of the goal. In this example, lag indicators might include the value of quotes submitted by a given date, or the number of new customers you have attracted. If you hit these metrics then you will have a reasonable expectation that the sales figures will follow.
Performance is an outcome co-created by leader and team in the context of a culture
Vroom’s Expectancy Theory
Victor Vroom is an Emeritus Professor of Management at the Yale School of Management. His expectancy theory provides a way of thinking about motivation towards a goal. It is:
Motivation = E x I x V
where E is the expectation that effort will result in achievement of a goal; I is the expectation that goal achievement will be rewarded; and V is the value of the reward to the worker.
‘E’ explains the important of ‘Achievable’ in the SMART mnemonic. Stretch goals are fine, but if the stretch is too great, your team members may balk at them and actually decrease their effort.
‘I’ and ‘V’ both relate to the reward. This may be a financial bonus, but often non-financial rewards are at least as motivating, for example public recognition, individual development on the way to the goal, and the feeling that you have made a meaningful contribution to the company. If you are a grateful leader who is liberal with her praise, and if you have a personal relationship with the members of your team, then their expectation of a reward will be high and so will the value that they place upon it.
Goals are not enough…
Of course, agreeing clear goals with your team does not guarantee a successful outcome. There are other things to consider, including:
- The resources the team can call on
- Levels of authorisation for drawing down financial and non-financial resources
- Task prioritisation
- Developmental objectives, for individuals and for the team as a whole
- Any intermediate gateways
Depending on the maturity of your team and the complexity of the task, you might also want to discuss plan and process.
Debriefing
Whether the goal is achieved or not, every task and project is an opportunity for individual and team learning. Internal debriefs are a key way of ensuring that lessons are learnt, successful formulae are captured, and mistakes are not made twice.
Start a team debrief by ensuring that everyone’s understanding of the goal, the plan, and the outcome is the same. Then, as leader, admit your own mistakes first. This will help create a climate in which the other team members feel able to be candid about their contribution.
Move on to analyse the execution — what went well and what went badly? You might apply Pareto to the lessons: 80% of the benefit will be in 20% of the lessons. Learn 3–5 lessons well rather than 20 badly.
Finally, if relevant, notify other parts of the organisation of the lessons learnt.
General guidance
Have a healthy bias towards praise. It’s an evolutionary adaptation of humans to be more sensitive to the risk of loss than opportunity. Therefore, most people will have a far stronger reaction to criticism than praise. As a general rule, praise in public, criticise in private.
It’s worth bearing in mind throughout, that performance is never an individual matter, but is an outcome co-created by leader and team in the context of a culture.
Consequently, criticism of others should only be contemplated once you have taken responsibility as a leader for your part in an outcome. Did you set your team up for success or failure? (see part 1/2). Did you remove the obstacles from their path or create some more? Did you provide them with the support they needed? If performance management is about holding people to account, then the leader should be first in line.
