Individual Performance Objectives
What gets measured gets done. Organizations manage their performance by:
- Setting performance targets for their financial results, processes and customer and employee outcomes
- Monitoring progress and results; and
- Taking action to improve performance and correct underperformance.
In the same way, managing and motivating individual performance begins with agreeing the right individual performance targets, or objectives.
Individual performance objectives document the results, outcomes and the level of performance expected, rather than just describe the job that someone does.
Specific and measurable performance objectives enable individuals to:
- Know what is expected of them and what they are aiming for – an important factor in motivation and employee engagement;
- Understand how their performance contributes to the performance of the organization;
- Monitor and assess their own performance; and
- Understand the basis for their performance rating at the end of the year i.e. what has been achieved vs. what was expected.
Specific and measurable performance objectives give you as a leader a framework for:
- Monitoring performance;
- An objective discussion (and action) if performance falls below what has been agreed;
- Providing recognition during the year; and
- Determining performance ratings at the end of the year.
Agreeing Individual Performance Objectives
Each individual should write their own performance objectives, even though, in reality they will largely be ‘pre-determined’ by the organization’s targets and how they translate into the objectives of their unit and leader.
By writing their own objectives, each individual:
- Can demonstrate their understanding of the organization’s targets and their own role in contributing to their achievement;
- Is more likely to feel that they ‘own’ them and use them to guide their own performance, as opposed to having to ‘comply with instructions’.
Ask each of your team members to draft their individual performance objectives after you have spent time as a team understanding:
- The organization’s vision, mission, purpose and strategy;
- How these translate into the organization’s objectives and targets for this year;
- What your function needs to deliver in order for the organization to achieve these objectives and targets;
- What your team needs to deliver to enable your function and the organization to achieve the overall objectives and targets;
- What each team member needs to deliver to support the delivery of the team and organizational goals.
This was covered in detail in the topic: Setting Team Goals.
You should then sit down together to review these draft performance objectives and agree them.
Use this checklist to ensure that you agree annual objectives that will motivate and will give you both an objective means of assessing performance – both during and at the end of the year.
Checklist: Individual Performance Objectives
Performance objectives should be:
- To those of the organization, your function / team, and to your objectives as the team leader
- To the organization’s KPI’s e.g. show the link between individual targets and those on the balanced scorecard, or to the organization’s primary financial and operating targets
- Ensure that you both agree what are the most important priorities
2. Focused on Outcomes:
- Each objective should describe the specific result or outcome required, not the activity
- Each objective should be clearly stated, with no room for interpretation
- Not everything that the individual needs to do can be captured upfront in their performance objectives. If history, or the nature of the role indicates that urgent, unforeseen priorities and ad hoc issues are likely to take up a significant amount of time, include an objective that recognises the achievement in effectively handling these.
4. Objectively Measurable:
- Define performance measures for each objective, quantify these where possible
- For long term targets, e.g. an annual sales target, define KPIs that show whether the progress during the year is on track
- Where quantification is not possible e.g. for objectives that relate to the demonstration of skills, competencies, behaviours or the organization’s values, document what will be objectively observed if they are satisfactorily demonstrated
- Set performance targets indicative of a ‘good’ or ‘target’ end of year performance rating, allowing room to exceed these expectations
- If appropriate, discuss and document ‘stretch’ targets indicative of superior or outstanding performance
- In order to motivate, objectives should be challenging, but not too challenging: unrealistic, unachievable goals are demotivating
- Is delivery of the objective is in the full control of the individual? Document key dependencies and factors that may affect delivery that are outside the individual’s control
- Discuss how the objectives play to the individual’s strengths - and how they challenge them to aid their growth and development. How are they linked to their development plan?
- How do the objectives map to the critical success factors of the individual’s current role?
- How do the objectives develop the competencies and capabilities that will support the individual in their planned career path and future roles?
- Do all of the objectives have a deadline for delivery, and key indicators and milestones to track progress?
- If objectives have no deadline, because they are ‘on-going’ or require ‘continuous demonstration’, agree and document what this means, what will be observed and how it will be evidenced.
Once individual performance objectives have been agreed it is all too easy to file them away until the half year and full year performance review.
This is not an effective means of managing performance.
Effective performance management requires:
- Monthly (or quarterly) meetings to review progress against annual objectives and development plans. Discuss and document what is going well, what is not on track and what actions need to be taken to correct this;
- Frequent, real-time, specific feedback to let people know how they are doing, to positively reinforce great performance and correct underperformance.
Formal performance reviews at the end of the year should reflect these on-going performance discussions.
It is also important that you review and update individual performance objectives during the year to ensure that they stay relevant and reflect current priorities.