I am often asked what the best place is to start transforming performance management. The answer depends on a company’s business goals and the state of its current processes. But, one area that is often overlooked is ensuring employees have clear and meaningful goals.
Providing employees with meaningful and challenging yet achievable goals is fundamental to creating a high performing organization. It is not very engaging to show up to work and not know what you are supposed to do or why it matters. Goals give employees a sense of purpose, clarity, and strategic direction. Goals also provide the foundation for providing effective feedback and making accurate talent decisions.
Most companies have some method for setting goals, but it is often more about process compliance than clarifying job expectations. Rather than focusing on communication and role clarity, many goal setting processes emphasize filling out forms. At a minimum, goal setting processes should strive to meet the following criteria:
Goals set the foundation for every other part of performance management. If employees do not have clear goals, then they will struggle to have effective coaching conversations with their managers since it will be unclear what to talk about. Additionally, the organization will struggle to make effective talent management decisions since it will be difficult to assess what employees have accomplished. If a company can only do one thing to improve performance management, it should be ensuring that employees have concrete, inspirational, and business-relevant goals.
For more tips on performance management, check out Transforming Performance Management: 15 lessons from 10 years of customer engagements or listen to this podcast to dig into the details about why employees want performance management to work, and what organizations and leaders can do to make it better.
Steve Hunt is senior vice president of Human Capital Management Research at SAP SuccessFactors.