Virtually everyone agrees that goals are important to generating results and that individual and team goals should be aligned with the organization’s strategy. Yet in many organizations, performers at any level, from the frontline to senior executives, often don’t know what their goals are. And, any goals they do have are often misaligned with what their managers think they ought to be doing, or with the organization’s strategy.
Too often, goals describe the activities they should perform, rather than the results they should achieve, which leads to endless activity without meaningful results.
Is it any wonder that most organizations fall short — far short — of achieving the results they expect from their strategies?
To improve performance then, start with aligning goals to the strategy.
In so many organizations, people put huge effort into executing their goals only to find that they’re not aligned to the organization’s strategy. For example, in one HR department, 60 percent of its actions didn’t align to the organization’s strategy.
In another case, a production manager said to a sales manager, “Why don’t you sell what we’ve made and put in inventory?” to which the sales manager respondrd, “Why don’t you produce what we can sell? The stuff we can sell generates a higher margin than that stuff you have sitting in the warehouse.” Both were rigorously executing on their goals in isolation from each other and their company’s strategy.
Play 5-on-5 to create alignment
Taking steps to bring strategy into alignment with goals can begin simply by having leaders and performers each write down a list of the performer’s top five goals. (On average, only two will match — which means that team members are aligned with, and working on, what their bosses think are the highest priorities only 40 percent of the time.)
Leaders and performers must keep the conversation going until there is complete alignment between the leader and the performer, and goals are aligned with the strategy and the goals of the organization, business unit and department.
Then, define goals in terms of results, not activities
Many times, workers will feel like they’re up to their armpits in activity but, in retrospect, they won’t feel as though they’ve gotten anything done. That’s often because goals, even if they’re aligned with the organization’s strategy, are often defined in terms of activities (stuff to do) rather than results (what you need to achieve).
Consider the job of servers in a restaurant. When asked to list their goals, servers commonly list the activities they do: Wait tables, take orders, turn the tables quickly and be courteous and responsive to the guests (all important, by the way). Yet, when asking restaurant managers their goals for the wait staff, it’s almost always “Increase profits for the restaurant” — a critical result.
Result-oriented goals change the game. They define what the performer must accomplish rather than do.
By defining goals in terms of results, the performer owns the results and the responsibility to identify and act on the highest-impact activities (performance drivers) that achieve the result. The actions the performer takes have a clear, concise purpose: Hit the goal.
The restaurant server must learn which activities generate the best profits for the restaurant (hint: sell drinks and desserts), while effectively serving the guests so they return.
Finally, put goals in to SET format
After identifying the result, the next step is to refine the goals in SET form: Starting point; Ending point; and Timeframe for achievement.
The starting point and ending point define the gap between current results and where the organization wants to be. Merely understanding this gap drives performance by engaging people to bring all their creativity and energy to the effort to close the gap.
Timeframe focuses the energy and attention necessary to achieving the goal. It also allows people to manage their time and priorities.
Fully driving strategy to better results can be complex and difficult. Yet, much performance improvement can be achieved relatively quickly by aligning everyone’s goals to the organization’s strategy.
To do so, start by:
1. Playing 5-on-5. Make sure everyone’s goals align to the expectations and strategies of the organization.
2. Establishing results-oriented goals. Focus the goals on result, not activities.
3. Putting goals in SET format. Make sure each goal has a Starting point, and Ending point and a Timeframe for achieving it.
**Originally published at CEO Blog Nation