Posted by Dave • August 5, 2020 (Last modified January 20, 2023) • 11 min read
Setting performance goals is essential in growing and developing talent within any organization. When we decide to improve at something or overcome a challenge, setting goals helps us see how we’ll make it happen. High-achieving employees set goals at a much higher rate than those who underperform, and sometimes the difference is just that: one bothered to set a goal in the first place.
Any organization with growth ambitions needs to make and reflect on goals regularly. Every employee has to focus on work that moves the needle. But to do so, they need to know—without a doubt—what they’re striving to achieve.
That’s where performance goals come into play.
When we set performance goals, SHRM says we need to think about the bigger picture: “The results […] achieved by employees should be tied to the organization’s strategy and goals. The employee’s development needs should also be taken into account in the goal-setting process. Development goals can be targeted either to improving current job performance or preparing for career advancement.”
But to do that, we need to start smaller.
Using performance goals, organizations set clear objectives for employees. The performance goals align with their skills and experiences and are achievable based on the tasks and responsibilities outlined in their job descriptions.
An employee’s performance goals should also be an extension of a larger group of objectives their team is focused on achieving. The collective contributions of each team member result in departmental goals being met, which in turn, positively impacts organizational goals.
Once performance goals are set, managers monitor their direct reports’ progress. They should use appropriate metrics to measure performance and meet with their team members regularly to discuss priorities and challenges. Managers should also document the performance milestones of the employees they oversee, so they have a record to consult when it is time to complete formal evaluations.
Organizations do this in many different ways. Sometimes they will set goals at the start of new quarters, for an activity during an all-hands meeting, or they’ll use goal-setting software during performance reviews.
Setting performance goals for every employee is crucial to creating a comprehensive organizational strategy. Goals define each employee’s role in the organization’s success, increasing the likelihood that revenue and other growth targets are met. Let’s review the specific advantages performance-focused objectives offer to employers:
Performance goals mean every employee has a purpose. They understand what they need to focus on and get motivated to hit their targets. Let’s explore the specific advantages performance goals bring to individual employees:
Setting employee performance goals is a no-brainer for any organization with long-term growth plans. Employees come to work laser-focused on tasks and projects that incrementally propel their team forward.
The most basic way to set performance goals is to think about where you currently are in your role, your department, or as an organization, and then think about where you want to be in a year.
How will you get there?
Most companies will opt to set SMART performance goals because they are proven to work.
If you want to bring the benefits of performance goals to your organization, you must take the right approach. Performance goals can do more harm than good when incorrectly defined and implemented. Employees get confused and frustrated when they need clarification on what they’re being asked to deliver. Some may even have a different interpretation of their goals than their manager, which can end up hurting their performance and job satisfaction.
The SMART goal method was designed to remove the pitfalls typically associated with goal setting. Let’s review each letter that makes up the acronym so you learn how to set employee goals that are understood by every stakeholder:
If your performance goals check those five boxes, you’ll likely find that every member of your workforce has a crystal-clear understanding of what they’re being asked to achieve.
Here are five performance review goals examples you can use to set goals for yourself or the people you manage. These performance goals examples follow the SMART methodology whenever possible, though some may deviate slightly from that format.
Revenue performance review goals comprise most of the performance review goals within the business’s marketing, sales, and revenue. Some example goals include:
Performance goals for marketing are vast and can include any area within the organization. Some of these goals are easier to track than others, as some are directly dependent on the marketing department, whereas others depend on a group of people.
Some performance goal examples for marketing include:
Product-specific goals will vary by industry and type of product. It really depends on what you’re selling and how you sell it. It’s harder to create broad goals, but here are some examples:
Most of these organizational and departmental goals will focus on revenue and reputation needs. However, managers and leaders shouldn’t forget about things like organizational culture, talent development, and employee engagement. We’ll reflect on some sample goals in the next section that touch on those topics.
For someone writing a self-evaluation, what are some goals they can set? Certainly, they can use any goals in the previous section as examples. However, self evaluation goals examples should also include goals surrounding development and personal growth.
Some self performance review goals examples include:
You can set goals surrounding anything! Even if you have personal goals about drinking water, getting a good night of sleep, or standing more during your job, consider telling your manager! They may be able to help you achieve them or at least create some accountability.
Cascading goals are a method used to structure your organizational goals. These goals are initially set by CEOs and other executives, and then those goals cascade down through the rest of the organization. It requires employees to take their own strengths and weaknesses into account and focus on the human side of the organization while thinking about the big bets for the year.
The goal is to create organizational alignment and ensure that everyone is held accountable for company success.
When you are setting performance review goals, there are a few things to keep in mind.
Following the SMART goal method is an effective way to define performance objectives clearly. However, you don’t just want employees to understand their goals. You want them to be enthusiastic about what they’re being asked to accomplish. We’ll conclude with a few tips for setting performance goals every employee can commit to.
It always helps to make goal-setting a collaborative exercise between managers and employees. While managers must assign particular objectives, they should still be receptive to the employee’s questions and feedback. They might find that an individual’s goals can be adjusted to align with the team’s strategy. These discussions also provide the opportunity to define the KPIs that measure the employee’s progress.
Once the baseline performance goals are agreed on, employees should be encouraged to set their own goals. The manager can present the team’s objectives, and the employee can share how their talents can be used to drive progress. Involving team members in strategic planning helps them see the big picture and get excited to deliver outstanding results.
Performance goals should never be set in stone. As the employee gets to work on their long-term objectives, new challenges will emerge, and priorities will shift. You want employees to take changes in stride, so be willing to push back deadlines or redefine goals.
You’ll also find some employees are on pace to accomplish their performance goals with time to spare. In these cases, acknowledge their stellar performance and revise their goals. Ensure their targets are always ambitious, so they stay motivated and productive.
Employees’ long-term objectives should be used as the basis for their performance reviews. Instead of asking managers to rate direct reports on a series of vague competencies, evaluate the outcomes of their goals. Managers should also consult the performance-related notes they’ve been documenting, so an employee’s evaluation accounts for all their wins during the review period.
Performance evaluation meetings provide the opportunity to review all the employee’s goals and the approach they took to accomplish them. Managers can go through the goals that weren’t met and share what they believe the employee could have done differently. They should also acknowledge the great effort the employee made to achieve the goals that were met.
Accomplishing goals doesn’t just stimulate meaningful productivity. It has a positive impact on employee engagement. Employees feel good when they continuously hit their targets and grow to derive satisfaction from doing their job.
So why stop with just performance goals? Encourage employees to use SMART goals for everything they do. Ask them to go through the process of defining quantifiable, time-bound objectives at the start of a new project. Every team member should always have a clear idea of what they want their work to result in.
You can also align performance goals with an employee’s career development goals. They can meet with their manager and share the skills they would like to develop and the challenges they hope to take on. Both parties can then create a professional development plan the employee can carry out through the experiences they have in the workplace.
Is your organization ready to implement employee performance goals? Trakstar is an online performance management solution that helps employers set and track goals across the organization. Cascade organizational and departmental goals down to individual employees and tailor performance objectives to their roles on the team. To learn more, request a live demo today!
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