Setting goals with your employees is an essential element of
effective human resources management.
There are a variety of reasons to set employee goals. Goals can:
focus employees on the purpose of your business; enhance your
chances of success by applying your employees efforts to your
company's long-and short-term success; and motivate employees.
Employee goal-setting is also an important part of an employee
appraisal or bonus program because without goals, achievement is
not easily measured.
To be effective, employee goals must be clear and
understandable. Each goal must be concrete, attainable, and
critical to the growth of your business. The tips below will help
you set good goals:
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Set goals with employees
Employees are often the best source for information about what
job-specific goals will contribute to overall increased
productivity, responsiveness, or other business goal. Involving
employees in goal-setting also eliminates the potential for the
resentment that can arise when goals are imposed.
Reevaluate goals frequently
At a minimum, do this halfway through the year to insure that
goals still make sense and that employees are on track.
Make goals specific and measurable
Don't set goals such as "Do a better job," because
a general goal does not instruct an employee in what steps to take.
An example of a constructive goal is "Increase response time
to customer calls by 30%" or "Cut customer complaints by
half."
Goals don't have to be tied to sales
Don't automatically assume that bonuses should be tied to
increased sales or even profitability. For example, it may be most
important in a given year for your business to cut costs or raise
visibility. Tie bonuses into that critical goal rather than one
that is traditional.
Make sure employees goals are attainable
Many people have a tendency to set goals too high. Unattainable
goals lead to employee frustration and lack of motivation and it is
your job to make sure that employee goals are realistic.
Be consistent
Don't set different goals for employees the same
responsibilities. Not only will this likely breed resentment, but
it can put you in legal hot water in terms of charges of
discrimination.
Watch your timing
It's common for businesses to set annual employee goals at
the beginning of the year. Others may want to do it before a busy
season, or at an annual company meeting. Be careful to set employee
goals and conduct evaluations on a calendar year, not on employee
anniversaries. This way, it will be easier for you to compare
performance between people with similar jobs.
Avoid rivalry
You want your employees to work against your competitors, not
each other. Avoid things like contests as part of your goal
setting. Instead, have your employees strive to meet a specified
target within a specified period, and reward those who meet it. By
doing this, you provide all of your employees with incentive to
share information and help each other.
Set goals that tie employees into the success of your
company
You might want to base financial incentives on the overall goals
of your company. This can be used to encourage teamwork, and for
everyone in the company to know that they are involved in your
growth and continued prosperity. For example, Levi Strauss has set
financial goals for the company for the year 2001; if the company
attains that goal, it will be possible for each employee to get a
bonus equivalent to their entire 1996 salary!!!
The views
and opinions contained herein are not necessarily those of American
Express and are intended as a reference and for informational
purposes only. Please contact your attorney, accountant or other
business professional for advice specific to your
business.
Copyright © 2002 American Express Company. All Rights
Reserved.