A few years ago, Sony set an ambitious goal of zero environmental footprint by 2050. The company dubbed this mission its “Road to Zero,” breaking the goal up into several pieces, each of which included specific, measurable targets that involved employees at each level of the organization.
“You get the sense that executives have clearly thought this through,” author Andrew Winston wrote about the initiative in the Harvard Business Review1. “They seem to realize that a big goal, just hanging out there on its own, would be far too daunting, nebulous and not very actionable.”
The proven effects of goals
The value of setting goals has long been proven. In fact, asserts Inc. magazine, there is perhaps no research finding in the field of organizational psychology that has been more solidly established2. The research can be boiled down to a few key areas: difficulty, specificity and proximity of goals. Goals that are specific and moderately difficult improve performance more than those that are vague and too difficult or too easy. Goals are more effective when they have clear target dates, regardless of whether they are short- or long-term, and goals must be measurable. In short, they must be SMART (Specific, Measurable, Achievable, Relevant and Time-bound.)
Hundreds of studies around the world have consistently demonstrated that setting specific, challenging goals can powerfully drive behavior, boost performance and increase achievement. Setting goals increases success rates in a wide variety of settings: For example, one goal-setting intervention with college students led to a 30-percent increase in academic performance over the control group3.
Goals as a performance improvement plan
Depending on a business’ needs, a data-driven approach can challenge team members to work towards incredibly specific key performance indicators (KPIs). For example, in the contact center industry, this could be as individualized as a personal goal for a contact center agent to raise his or her customer satisfaction KPI by 12 percent in a given region. It could include team goals as well, because research has found a combination of compatible group and individual goals to be more effective than individual or group goals alone. The more specific the goal, the more direction each employee has. By challenging the team and letting them know what you want, you’ll see faster and more concrete results.
Goals also offer a range of less easily measured benefits: They can clarify expectations about employee performance, relieve boredom in repetitive or monotonous jobs and increase job satisfaction when goals are met. Team members who have a clear view of the expectations and needs of their companies receive higher customer service scores, show productivity gains, maintain higher rates of compliance and increase retention.
Goal-setting’s effects on employee engagement
Goals are also a powerful driver of employee engagement. In fact, a study conducted by Harvard Business Review found that 69 percent of employees felt that business goals that are effectively communicated and understood have the largest effect on employee engagement4. To do so is easier said than done, however: A Gallup poll found that 50 percent of employees worldwide don’t truly understand what is expected of them on the job5.
Goals that are SMART can be applied to nearly every aspect of life and business, from weight loss to corporate restructuring. They work just as well on the macro level as they do for individual employees or a single project.
A management tool for strengths and weaknesses
SMART goals can be applied to strengths or weakness, or both concurrently, depending on the performance context. For example, for several years now, the coaching industry has focused on developing employees’ strengths with SMART goals, but Columbia University Professor Tomas Chamorro-Premuzic argues that coaching interventions that focus on specific faults or weaknesses of employees are even more effective. Helping people bridge or reduce the gap between their ideal self and their actual self can improve behaviors and even trait-like dispositions by 30 to 40 percent, Chamorro-Premuzic told the Harvard Business Review6.
It’s not that your managers should ignore their team members’ strengths; rather, they should take a balanced approach that considers strengths in relation to the larger group and not relative to an individual’s range of abilities, Chamorro-Premuzic believes. With this approach, a manager might choose to address an employee’s best KPI first, if it is average or below average when compared to those of his or her peers; in the context of the team as a whole, it is in fact an objective weakness.
Moving forward with performance management
Regardless of the behavior you are trying to improve, goal-setting is a critically important component of providing ongoing feedback7. By establishing and measuring KPIs tied to overall business goals, you can give your employees real-time input on their performance while coaching them to achieve more. When employees feel noticeable progress towards aggressive goals, they become more fulfilled, less likely to burn out and more confident in their abilities to achieve those goals and contribute to the company’s overall success.
Adam Aftergut is a product marketing manager for
NICE Performance Management, the leading software solution used by contact centers to improve customer satisfaction scores (CSATs) while reducing contact center operational costs.
1 Andrew Winston, “Sony’s Goalsetting and the Value of Zero”,
Harvard Business Review, https://hbr.org/2010/06/sonys-goalsetting-and-the-value.html
2 David Van Rooy, BSQ: “The Only Goal-Setting Framework You Will Ever Need”, Inc, http://www.inc.com/david-van-rooy/the-only-goal-setting-framework-you-will-ever-need.html
3 S. Turkay, “Setting Goals: Who, Why, How?” Harvard Business Journal, https://hilt.harvard.edu/files/hilt/files/settinggoals.pdf
4 Analytics services, “The Impact of Employee Engagement on Performance”, Harvard Business Review, https://hbr.org/resources/pdfs/comm/achievers/hbr_achievers_report_sep13.pdf
5 Jim Harter, “Obsolete Annual Reviews: Gallup's Advice”, Gallup, http://www.gallup.com/opinion/gallup/185921/obsolete-annual-reviews-gallup-advice.aspx
6 Tomas Chamorro-Premuzic, “Stop Focusing On Your Strengths”, Harvard Business Review, https://hbr.org/ideacast/2016/01/stop-focusing-on-your-strengths
7 “Performance Management”, NICE, /engage/workforce-optimization/performance-management