Goal management is the process of setting goals/expectations, tracking, measuring, registering learning, and setting new goals/expectations, tracking, measuring, and so on. When goals are tracked, the performance of the members of a team improves — and, consequently, so does the performance of the organization as a whole.
With this in mind, we have prepared this material to help you understand the benefits of goal management for a team, as well as a step-by-step approach to developing it. Keep reading and learn more!
What are the benefits of goal management for the company?
We will initially look into the benefits of managing goals for the company. Check it out!
Increased operating margins
Through goal management, the employee understands how his or her work can contribute directly to the company's success. That usually drives him or her to focus on smarter and more effective strategies to meet his or her demands. The inherent result: productivity gains, as well as increased operating margins.
More agile execution of the company's strategy
Especially during more challenging periods, executing of the company's strategy in a more agile manner becomes a requisite, as it will translate into a competitive advantage for the business.
When the organization performs goal management, especially using the OKRs methodology, individual contributions will be clearly and publicly defined — redundant initiatives are quickly identified to allow fine-tuning of actions, allocating work and contributing to build more efficient projects.
Developing strategies to reduce turnover is one of the main challenges for companies. According to a Robert Half survey, Brazil stands out as one of the countries with the highest employee turnover rates. During the study period, turnover rate in Brazil rose by 82%, more than doubling global averages (38%).
Dissatisfied employees are more likely to quit the company. In this sense, objectives/goals clearly aligned with the business will naturally contribute to a greater feeling of responsibility/ownership towards the company's success.
Company and employees aligned
Another outstanding aspect regarding goal management is company-employee alignment. Especially in the OKR management model, individual goals are aligned with the team's goals and, ultimately, with the company's goals.
From this perspective, each person can understand how his or her own work impacts business results, which foster greater engagement. Moreover, through the strategic map, each professional is able to perceive how all areas are reciprocally aligned and how his or her duties are interconnected with those performed by other members of the team.
Identifying training needs
At the end of a goal management cycle, the team as a whole will debrief on the results. This is the time to identify what went well and what can be improved. If the desired results were not achieved due to lack of team training, for instance, this is an opportunity to assess what kind of training can be conducted to help improve the numbers over the next cycle.
Adopting this practice across the organization generates other noticeable gains. These include, among others:
- improving the team's productivity, since the employee will become more interested in the tasks performed;
- adding more quality to the results;
- encouraging teamwork, especially when one role is identified as directly interfaced with another;
- fostering the emergence of leaders.
How to manage goals in your business?
Now that you already know the benefits of goal management to your company, here's a step-by-step approach to implement it.
Engage the team
The first step is to engage the team in the elaboration of the goals. Again, the features of OKRs should be emphasized, which are more decentralized. That is, they are not defined from the top down, but rather jointly. At a certain moment within the cycle, the whole team identifies how their activities can impact the team's and the company's macro results, so that the definition of the goals is greatly shared.
This contributes to a broader sense of belonging, which, again, impacts turnover and absenteeism rates, turns employees into advocates for the company, and engages professionals from different sectors to commit to the organization's objectives.
Set a long-term objective
First, the company should set a long-term objective (10 years, for instance). Ask yourself: where do you see your company in this period? What do you want to achieve by then? A startup with steady the domestic market growth might aim to successfully reach the global market. Against this background, assess your business scenario, study the current numbers and make a forecast for the future.
Set your 1-year objective
After planning your 10-year goal, it is time to set your 1-year strategies and objectives. For this purpose, you can use the SMART model.
- Specific — On what scale do you wish to compete?
- Measurable — How will you know you've achieved your objective? How will you benchmark your success? What will your success indicators be?
- Achievable — Is this objective achievable given the resources you currently have? What obstacles will you face? How do you plan to overcome these obstacles?
- Relevant — How relevant is this objective for your company and employees? What will the benefits for the organization be?
- Time-bond — By when do you intend to achieve this objective?
Now think: What must I do now to achieve this Objective? Who can contribute to the success of this objective? Who will have the greatest impact on this objective and its key results?
Set quarterly and monthly objectives
What needs to be done monthly and quarterly to achieve the annual objective? To get a more relevant answer, gather your entire team, set out the company's dream and goals, and open up for suggestions that contribute to achieving them. As your employees are closer to your customers and the day-to-day problems, they may bring valuable information.
Establish the size of each cycle
When it comes to setting the size of your goal cycles, you should take three aspects into consideration:
- Market: The more competitive and innovative your market is, the shorter the cycles should be (Monthly). After all, the faster the external environment evolves, the faster the internal changes must be.
- Business model maturity: The maturity level of the business model affects the ability to clearly perceive the scenarios ahead. Thus, the newer and more innovative the company is, the shorter the cycles should be (Monthly or Quarterly).
- Mastery of Goal Management practices: If your company does not have a mature goal management culture, the cycles should be shorter (Monthly, Bimonthly, or Quarterly), thus accelerating learning.
Therefore, set Organization, department and individual Goals and Objectives annually, quarterly and monthly, respectively. And most importantly: TRY THEM OUT. Check what works and what doesn't and change whatever is necessary.
Set department/team goals and individual goals
Align departmental goals and objectives with your managers. Next, ask them to lay out team goals and objectives for their direct reports and ask the team to think of individual goals for the cycle. Afterwards, your managers should meet individually with each direct report to align the goals.
Deliver constant feedback
Feedback is a process in which a person contributes to the self development of another person based on his or her own perceptions, whether negative or positive. When delivered, the employee consequently has the opportunity to adjust his or her course, especially if the goal has not been reached.
This is precisely why having a tracking routine is key. You can thus understand what results have not been achieved and what can be done to change this picture. At this moment, actions are discussed to improve the numbers in the short term (considering the cycle), as well as to engage other people in projects that could more precisely affect these results.
This content was intended to provide you valuable insights on goal management, how important it is for businesses, and some useful tips to implement it in your company. As we addressed, in addition to increasing employee engagement, we also saw that it contributes to a greater alignment among teams, and ensures that the execution of the company's strategy is followed.
Want to learn more about the advantages of software to assist in this process? Stay tuned to the blog and check out the extra content we've prepared!