How to Make Employee Goal Setting More Impactful?

Whether companies already have performance management systems in place or not, goal setting is crucial for most organizations. This is because goal setting makes for effective employee performance management and prioritization in the workplace.

A 2017 performance management study by Mercer, an HR consultancy, found that 89 percent of employers have employee performance goals linked to employee pay.

That means making employee goal setting can be more impactful given that we understand the links between goals and performance.

In this article, we’ll be addressing motives and intrinsic factors that shift the impact of employee goal setting on performance. We hope that your company will tap into more impactful goal setting that will better the performance of your workforce.

Understanding employee motivation and performance

When rolled out correctly, goal setting helps improve employee motivation in a way that benefits a team’s overall performance, according to a recent McKinsey study.

After all, the natural outcome of impactful goals is to support the growth and development of employees themselves. Having a solid understanding of this purpose company-wide will serve as a motivator for employees to create both short and long-term goals for themselves and the company.

Leaders in the company should strive to create challenging stretch goals in partnership with their teams to inspire commitment and ownership. Employees who have agreed to be challenged utilizing collaboratively set stretch goals have a much higher likelihood of pushing their performance and growing their roles.

Aligning company goals with employee goals

Did you know? 91% of interviewed companies using performance management systems in the same McKinsey study say that employee goals should always link to business objectives.

The logic is clear: when employees can see how their work impacts the big picture, they feel more accountable and perform better. Encouraging employees to align their goals with company goals inspires ownership and ongoing development as the company grows.

At Unlock OKR, for example, we recognize the importance of cascading goals and always provide clients with training sessions for goal alignment and execution.

Getting employee buy-in

Once a company’s management team has cascaded organizational goals to departments, it’s time to get employee buy-in. In practice, this could mean educating employees on the goal-setting framework being used, supporting the creation of individual goals, and encouraging feedback on high-level company goals.

For a vast majority of top performers, the buy-in process demonstrates company transparency and acts as a springboard for trust-building in the goal-setting process. The key is to help employees review, reflect and adapt to the new goal-setting framework that will affect their work and day-to-day routines. Something that requires trust in leadership to achieve employee buy-in.

Publicizing the reasoning behind new goals may not result in 100% agreement from all employees, but it is productive as it is necessary to bring to the table before cascading any goals. The first step to implementing a successful goal-setting framework is employee support. Having the support of employees does not mean everyone needs to agree, but rather, they understand the benefits and cooperate to ensure the implementation goes well.

Also Read: 5 Ways to Optimize the Adoption of OKR Framework

Committing to staying on-track with communication

In the quest to ensure employee goal setting has a more significant impact, goals can move off-track or even become irrelevant as company priorities change. However, do not shy away from having tough conversations to address these events.

It can be tempting to write off an off-track goal as employees underperform. But to better employee goal impact, we must identify roadblocks through frequent communication and find out why their destinations are off-track.

Companies that do this well manage off-track goals by setting out a foundation for a culture of feedback across the organization. Making weekly 1-on-1s a requirement is one said example. When frequent communication is fostered, employees approached about their goal progress, whether on or off-track, will never be caught off-guard and experience a sense of fair treatment.

Also Read: OKRs: 4 Key Things that Employee Goal-Setting Software Must Do

Ultimately, it is in the best interests of employees and companies to set goals that impact business outcomes. For goals to stay on track, both parties have to be committed to staying on track with frequent communication, whether through 1-on-1s or OKR check-ins.

Have a question on goal setting we can answer for you? Want to learn more about how you can make employee goal setting more impactful using Unlock OKR? Book a Demo.