This is the second in our series of articles which tries to answer some of the questions new managers most frequently ask. Our first piece was on Giving Feedback.
OKRs, SMART goals, stretch goals... this is all too much. I just want to know how I can set some sort of objectives for my team to work towards, and do it right.
If that sounds familiar, then this article’s for you.
We cover the following:
- Should I even bother with goals?
- How do I know what goals to set?
- How should I talk about goal-setting with my team members?
- How should I structure my team’s goals?
- How many goals should a team member have?
- What is a ‘key result’ and are they useful?
- What are stretch goals? Should I use them?
- Should I mix up company and personal goals?
- What happens if goals get out of date?
If you’re more familiar with goal-setting or have more established processes in your company, you still might spot the odd question you want to dip into.
Let’s get started.
Should I even bother with goals?
It’s easy to get disillusioned with goal-setting, particularly if you’ve been part of a process that’s done badly.
This typically includes setting irrelevant goals which quickly become outdated, but which are nevertheless used to judge performance at the end of the year, causing pain and frustration for everyone.
Some readers may be nodding sagely at this point.
It often ends up this way when setting goals is centrally mandated - ‘your team must have goals to fulfil our HR processes’ - rather than used as part of a manager’s overall toolkit to improve your team.
It’s a shame, because when done well, goals can be an incredibly powerful tool to keep your team aligned on valuable work, and progressing in their personal development. Not to mention motivated. According to one survey, employees who work for a manager who helps them set goals are 17 times more likely to be engaged than disengaged.
So yes, when done well, you should absolutely bother with setting goals. Now for how we do it...
How do I know what goals to set?
Give or take a few outliers, your team members are probably working for your company because they see potential for alignment between their own professional aspirations and the mission/activities of the organisation.
The path to success and happiness for all parties (hopefully) lies in your team members doing work which your company values, and which also develops their skills and career. Their goals should typically reflect this balance.
To know what goals to set, you therefore need to know two things:
- What does success look like for your team, and how do your team members fit into that? What results do they want to achieve?
- What are the career aspirations of your team members?
Probably the number one mistake new managers make in goal setting is to try and do it without a clear understanding of these two points.
Reassurance on Point 1 will typically come from speaking to your own boss. Without knowing what your boss defines as success for your team it is impossible to structure underlying goals for your own team members. So be sure to get clarity on this.
Some companies may have very clear OKR-type processes which cascade objectives down through leadership levels to provide this information. In other cases, it may just be a case of talking to your boss to find out what they think is important for the coming months/fiscal year/etc. Either way, it’s invaluable.
Point 2 comes from speaking to your team members about their personal ambitions. This can be a tricky conversation so we actually wrote a whole article on how to make sure these career conversations aren’t forced and awkward. You may have team members who know exactly where they want to be in 5 years’ time, in which case, great. You may have others who only have a vague idea, but know the skills they want to develop, the people they want to meet, and the types of work they want to do. It’s all valuable information as you try and draw up a set of goals which aligns with how they want their career to progress.
With these two sets of information, you’re now in a position to plan some goals. There will typically be a combination of both these elements. Some goals will be more ‘company-orientated’ - e.g. achieve this sales target by this date, ship this feature by this date. Some will be more ‘individual orientated’ - e.g. ‘complete training in this discipline’. But taken as a group they should represent a body of work which the organisation and the individual will value.
How should I talk about goal-setting with my team members?
Good news! By asking this question, you’ve already assumed the most important part - ‘with my team members’.
In order to feel invested in the goals they’re working towards, you will need to develop them with the team member. Spoiler, coming up with a list of tasks someone needs to work on and telling them to get on with it is not a recipe for success. Sounds obvious, but you’d be surprised…
The second thing we’d mention depends on whether you’ve discussed goals with the team member before or whether this is all new - either because you’re a new manager, or they’re new to your team.
If it’s all new, it’s possible that you need to give some background as to why goal-setting is a valuable exercise. Some people may not be familiar with the process. Or worse, they may have had bad experiences with other managers (see the first question above), and become quite cynical about the whole thing.
In which case, before getting started on the substance of the goals, it may be worth reiterating why you’re having the conversation in the first place - that you want to put together a plan of work which will support their career aspirations through doing valuable work, to ensure they progress.
Links to Performance Management
Depending on your company’s performance management processes, it’s possible that the goals you set, or at least some of them, will be linked to performance management processes such that their fulfillment affects promotions and compensation. If this is the case, it’s important to be transparent with your team about that link and how it works so they can set and approach goals with that in mind.
For companies with more formal OKR-type systems, this will be very clear. For other companies it may be more blurry and you may need to talk to your boss or HR to make sure you understand the process and can answer any questions from your team member.
How should I structure my team’s goals?
Ok, by this point, you should:
- Understand what success looks like for your team, and how your team members can contribute to that.
- Appreciate your team members’ career aspirations, the strengths they want to build on, and the work they thrive on.
- Have set expectations with your team members about the purpose of goals, how they work at your organisation, and how they can benefit them.
Now you’re ready to set some goals.
It’s at this point that we are going to throw in some jargon, because the SMART framework for setting goals is actually pretty useful. It suggests that to be effective, the goals you set should be:
- Specific: you should be clear about the outcome to be achieved, and who is responsible for achieving it.
- Measurable: you need to set specific criteria for progress and success so you know when the goal has been completed (key results and milestones are useful for this - see below)
- Achievable: don’t set people up to fail. The goal should be realistic (although there’s some nuance - see stretch goals below).
- Relevant: the goal should be relevant to the work of the company.
- Time-bound: the goal should have a clear date for estimated completion.
For example, imagine you’re working in an organisation’s marketing team. Setting someone a goal of ‘Improve our overall marketing and branding’ is incredibly unhelpful. Whilst it may be relevant, it’s not specific, measurable or time-bound which also makes it hard to achieve.
In contrast, ‘launch the new company website by 1 May after approval by the board’ is specific (the website), measurable (launch it, after board approval), achievable, relevant and time-bound (1 May). You can also put in more granular milestones with dates to measure progress, such as ‘Finalise designs’, ‘Finalise Copy’, ‘Present to Board’ etc. These milestones shouldn't be too granular though. You want to give your team members some targets to aim for, but empower them to work out how to get there. Goals and milestones should not read like task lists.
How many goals should a team member have?
We wouldn’t worry too much about this question. If you work out what success would look like over the relevant time period for the individual and the company, and then plan the corresponding goals, you’ll probably get there.
As a quick tip though, try and stay focussed on the areas that are most critical. They’ll probably take longer than you think, and you don’t want to be left with a load of smaller goals to worry about which just don’t get done.
As Cristos Goodrow, VP of Engineering at Google, reflected on past goals practices at YouTube:
“A team would open a Google doc and start typing in objectives, and they’d wind up with thirty or forty for ten people, and less than half would actually get done."
Try not to do this.
What is a ‘key result’? Are they useful?
You may have heard this term. Or objectives and key results (OKRs)? OKRs are a very specific goal-setting framework which we’re not going to get into here. But at a basic level, the two key components are the ‘Objective’ - the high level goal - and the ‘Key Results’ - specific measures used to track progress towards that goal.
You might also think of key results as milestones, which break down large goals into more achievable chunks (see the website launch example above).
We mention them here because regardless of whether you’re using a formal OKRs framework, breaking down large goals into milestones/key results is a really useful way to keep the goal relevant, and make it more digestible for your team members.
It also makes it more motivating to work on. Research has shown that people feel they have good days at work when they make progress. Setting milestones on goals is a way for team members to keep feeling like they’re making progress, rather than saving that all up for one moment when they complete the overarching goal, which could take months.
What are stretch goals? Should I use them?
Stretch goals are exactly what you think they are. They’re ambitious goals which require a ‘stretch’ by the team member beyond their existing capacity to achieve. They’re designed to push people outside of their comfort zones to solve difficult and valuable problems for organisations.
Doesn’t that sound great, and bold, and positive? Well, yes, in some circumstances. Some research suggests 70% of employee learning occurs working towards stretch goals, and in a recent set of tweets we analysed, stretch opportunities were the number one thing team members wanted from their managers.
To a certain extent, all goals you set should be ‘stretchy’ - the team member should have to grow professionally in order to achieve them. But a true ‘stretch’ goal is often radically outside expected performance, and here there’s a balance to be struck and expectations to manage.
If you set wildly ambitious stretch goals, there has to be acknowledgement that the team member might fail, and an understanding of what that means for appraising their performance. Not all organisations are set up to embrace failure. How would failing at all your goals (even with impressive underlying results) be received in your company culture?
For these reasons, often some managers choose to set stretch goals alongside more realistic goals, which still challenge the employee but are more achievable. For example, setting a sales goal of $1 million for the financial year but a stretch target of $1.5 million. The employee knows they will have done well to achieve the first one, but the incentive is there to reach even higher. It may be a device you choose to employ
Should there be a mix of company and personal goals?
Some companies speak in terms of ‘company’ goals - i.e. targets the company wants you to hit, like sales figures - and ‘personal’ or ‘professional development’ goals i.e. those focussed more on the individual, like undertaking training. We’ve heard conversations about encouraging people to have more ‘personal goals’.
To us, this is an artificial distinction, which suggests that team members’ work isn’t generally supportive of their own professional development. We’d generally advise against speaking in these terms.
If you’ve taken care to understand your company’s needs and your team member’s aspirations, you should be able to come up with a set of goals and milestones that both parties will value, without making a distinction about which goal is more focussed on which side.
What happens if goals get out of date?
One of the most common complaints about goals is that organisations move so fast that what’s written on paper quickly becomes irrelevant. To which the answer is that they only become irrelevant if you let them.
Now, we get it. Everyone’s busy, and updating goals doesn’t necessarily feel like the most pressing item on the agenda, and before you know it 3 months have gone by. But often this happens in cases where the goals were poorly set in the first place, no-one was invested in them, and appropriate milestones weren’t in place to measure progress.
If goal-setting is done well, both parties should be incentivised to revisit them regularly to update on progress, at least on a monthly basis. It may be worth having a dedicated 1:1 meeting just for this purpose.
Even with this, it’s likely that in a growing business, some goals will still become dated - either as an individual or the company evolves. In this case, don’t be shy about creating new goals, altering old ones, or deleting them to create a framework which will best guide your team members’ work (albeit with consideration for performance processes).