Employee goals are at the heart of successful performance management. Goals help align employees with the organization’s mission. They also help employees see how their contributions fit into the big picture and the value they bring to the company.
Goals direct and guide employee efforts, motivate performance, and improve performance evaluation and strategic planning.
In other words, without the right goals, performance and engagement suffers.
In this article, you'll learn the best ways to set and track employee goals as a part of a modern performance management approach, plus:
Goals help people and organizations achieve more, faster, with less. Goals can be a powerful tool in your organization too. Here are some of the most impressive benefits of employee goal setting.
Goals unite employees, managers, and leaders around a common purpose. When employees understand organizational goals, they can align their team and personal goals to better achieve and exceed company-wide targets.
Goals provide guidance to employees, including how they spend their time, which projects to complete, and the amount of effort to give their work. Goals encourage employees to take action and spend less time focusing on activities unrelated to their goals.
Goals prompt employees to plan. When employees have a goal to achieve, they are more likely to create and execute a plan to meet that goal.
Goals motivate, inspire, and fuel higher performance. They energize employees and drive tenacity. When faced with meeting a goal, employees become resourceful, using or seeking out existing knowledge or acquiring new knowledge needed to succeed.
Goals help measure success. All future-focused organizations are trying to improve, grow, and succeed. Goals provide a clear path and method for evaluating company success by comparing actual to desired performance.
Goal-setting is one of many crucial conversations managers must have with their team. But when should managers have those conversations?
Organizational goals should be a routine topic, integrated and woven into your regular conversations with your team. Consistently connecting business objectives to your team’s day-to-day work:
It’s important to have regular conversations about individual goals with each of your employees. Sit down and discuss employee goals:
This one is the most obvious. Most companies set goals during annual or quarterly review meetings. These are good opportunities to take stock of past performance and look ahead to the next quarter or year to identify opportunities for growth. While goal-setting conversations may only happen annually or quarterly, make sure you’re talking about employee goals throughout the year.
Regularly meet with your employees one-on-one to check in on goal progress. Check-in meetings help you gauge how they are doing, review performance, and discuss any obstacles or challenges that may be preventing them from achieving their goals. If an employee’s performance is going off-track, frequent check-ins help you intervene before it’s too late. This allows you to put a plan in place to help your employee get back on track or adjust goals as needed.
Sometimes business or team priorities change due to evolving business needs, changing markets, or even budgetary changes. Help your employees adapt their existing goals or set new goals that align better with the new direction.
When your team hits their goals, it’s time to set a new target. Sit down with your employees to come up with goals that will help them continue to grow.
Use the following tips to help your team set goals that will motivate and engage employees and drive their performance year-round.
Employee goals shouldn’t be set top-down. Instead, make goal setting a collaborative effort to get buy-in on employee goals from employees and managers.
Managers have a good bird’s-eye view of team and business priorities, which can help them identify useful performance benchmarks for their team. However, it’s important to bring employees into the conversation and include them in the goal-setting process.
When employees participate in setting goals for themselves, they are more likely to be invested in their performance from the beginning and are more accountable to the results.
If you don’t know where you’re going, it will be difficult to set meaningful goals. What is the ultimate business objective, team vision, or employee development plan? How can your employee’s goals help them get there?
When you sit down with your employees, be sure to give them this important context. When they understand the broader team goals and company priorities, they can set more effective goals that will have greater impact on individual and business performance.
Once you’ve set goals together, make sure to check in regularly on their progress. Goal conversations aren't a one-and-done task. They should be part of a continuous growth cycle.
There are multiple ways to approach goal-setting. Consider using the SMART method or the OKR method to achieve results.
SMART is an acronym. Each letter stands for one of the five criteria of a “SMART” goal. The SMART philosophy holds that when people focus their attention in these five areas when goal setting, they’ll increase their chances of success.
S.M.A.R.T. goals should be:
The S.M.A.R.T. method is a tried-and-true approach that works especially well with aligning employee goals to organizational priorities. However, it can sometimes focus too heavily on goal-setting and not enough on goal-getting. This can lead employees to essentially “set it and forget it” until the next annual review.
The Objectives and Key Results framework organizes key results under objectives. An employee, a team, or an organization will typically identify 3-5 objectives with 3-4 key results underneath.
There is a lot of overlap between SMART goals and OKRs. The main difference is that OKRs focus on setting aspirational goals rather than attainable objectives.
The OKR method helps employees aim high and break down the goal-getting process into manageable, concrete milestones. Where S.M.A.R.T. goal-setting tends to be a top-down practice, OKRs are a bottom-up, employee-led activity. This encourages employees to create inspirational goals that can motivate them more effectively and stretch their performance.
However, OKRs can lead to disappointment if you’re not careful. If the goals are too far out of reach, that can lead to frustration and demotivation among your employees. Additionally, because OKRs are employee-led, there is greater risk of misalignment with team and organizational priorities.
To make OKRs work, managers need to help their employees set objectives that will stretch them without breaking them and provide the needed context around company goals so everyone is on the same page.
The purpose of goals is to propel your business forward. If employee goals aren’t relevant to your broader team and organizational goals, then what’s the point?
Share business priorities and team objectives so employees have context for setting relevant goals. Goal alignment is key because it ensures your employees are working towards results that matter while driving greater engagement.
Effective goal alignment not only starts at the top, it sets the tone for the future of the organization. Company goals should inspire team goals, and team goals should inspire individual goals. Showcasing the connection between each level gives each employee a clear sense of purpose.
If the organization isn't clear on its own goals and performance, managers and teams won't be clear on theirs. Aligning goals among teams gives employees the feeling that everyone is contributing to the organization's main goals together, forming stronger team bonds.
Individual employee performance goals should be aligned with organizational goals. When employees understand how their work contributes to the bigger picture they will be more engaged and motivated to perform.
Priorities change, team dynamics or functions shift, and suddenly the goals employees set in January no longer make sense in June. That’s okay! Change is normal and inevitable in business. The key is to adapt with those changes to remain relevant and effective.
Check in with your team regularly (at least quarterly) to make sure their goals are still relevant. Pay attention to factors like company changes, employee turnover, budget constraints or technology advancements that could impact goal alignment. Then adapt goals as needed in real-time so that your team is always aligned with business priorities.
Goal-setting is a powerful and important way to engage employees and drive performance. Make an impact with these employee goal-setting tips, plus 5 Sure-Fire Strategies to Set Goals That Get Results in our ebook.