According to a Gallup poll, nearly half of workers lack clarity on what is expected of them at work. However, when employees feel engaged, they develop a sense of care toward the company, going above and beyond to achieve shared goals. This also leads to job satisfaction. One powerful way to do this is through the implementation of effective performance goals.
Employee performance goals offer employees a clear understanding of what is expected from them, providing a roadmap for success. When employees are aware of their performance targets and how their efforts contribute to the company’s broader objectives, they develop a deep sense of connection to their work.
The start of the year — when people are in resolution mode — presents the opportunity to reflect on the year past and set performance goals for the year ahead. Doing so engages employees, giving them a renewed focus and purpose.
The Importance of Employee Goal Setting
By aligning individual performance goals and tasks with the organization’s overall vision, employees become highly engaged. And every leader knows that employee engagement directly correlates to business metrics including client retention, profitability, and growth.
In fact, a recent Gallup poll found engaged employees are 14-18% more productive than non-engaged employees. Yet only 23% of 120,000+ employees surveyed for Gallup’s recent State of the Global Workplace report being engaged at work. 62% say they’re not engaged, and 15% note they’re actively disengaged.
This doesn’t have to be your story. You can start engaging your employees by challenging them to set both professional and personal goals. Your goal alignment strategy is up to you, and you can determine it based on what works best for the employee’s job position. Set weekly or monthly goals. Perhaps quarterly will do. For professional development goals, determine what is appropriate for the job, but try to also list at least one goal that’s tied to personal self-development.
Either way you slice it, evaluating individual team members on strategic goals and viable metrics increases the chance of success for both employees and supervisors.
How to Set Goals for Employees (with Examples)
Follow these seven steps for powerful employee goal setting that can change the way your organization operates.
1. Identify your Company Strategy
Everything starts with an overall strategy. It can be helpful to use a goal-setting framework like the OKR (objectives and key results) method when defining goals with employees. But even if you use another method, it’s important to ensure business leaders and managers are aligned on which objectives are important. They are the ones who’ll be communicating the vision to the organization.
2. Build Cascading Objectives
Map out how objectives will cascade across the organizational structure. You’ll want to clearly identify the performance objectives for each team and how they relate to overall strategy.
Here’s an example:
- Company-level objective: Increase market share by 10% in the next fiscal year.
- Sales team objective: Increase sales revenue by 15% through targeted marketing campaigns and expanded customer outreach.
- Marketing team objective: Generate 50% more leads through digital marketing channels and optimize conversion rates.
- Product development team objective: Launch two new product features to enhance customer satisfaction and attract new clients.
- Customer service team objective: Achieve a customer satisfaction rating of 95% by implementing proactive support measures and reducing response time.
3. Connect Goals to Individual Tasks
Identify specific attainable goals for employees to make future evaluation more objective and remove ambiguity. And, start with the end in mind. For example, you want your sales reps to schedule two appointments each week. So, identify two to three behaviors that are likely to result in reaching that outcome. Now the employee knows where they are expected to go as well as how to get there.
4. Document Goals or Integrate into your Performance Management System
Be sure to document goals in writing, both formally and informally. This is how you ensure accountability. The formal process might include a standard form, a performance development plan or other assessment, specific timelines, checkpoints, and occasional updates. Informal documentation might take the form of notes written from regular development conversations that support the formal process.
Clearly outline responsibilities and make sure employees have the competencies and resources required to achieve their goals. Employee actions and behavior should be judged according to these objectives.
5. Use the SMART model
It’s important to coach employees on how to set objectives. Employee goals and company goals should always be Specific, Measurable, Achievable, Relevant, and Time-Bound. By following this model, individuals and teams gain clarity on what needs to be accomplished, can track progress, set realistic targets, align goals with broader objectives, and establish clear deadlines. Ultimately, using the SMART model increases the likelihood of success, maintains motivation, and allows for effective monitoring of goal achievement.
Here’s an example of a SMART goal for a long-term care employee:
Goal: Complete a certification program in geriatric care within the next 12 months.
Specific: The goal clearly states the desired outcome, which is to complete a certification program.
Measurable: The goal specifies completing the certification program within the next 12 months. This allows progress to be tracked and evaluated.
Achievable: The goal is realistic and attainable, considering the employee’s capacity to dedicate time and effort to the program, as well as the availability of suitable certification programs within the given timeframe.
Relevant: The goal is relevant to the employee’s role in long-term care, as it focuses on acquiring specialized knowledge and skills in geriatric care, which can enhance their ability to provide high-quality care to elderly residents.
Time-bound: The goal has a specific time frame of 12 months. This provides a deadline for completing the certification program and ensures a sense of urgency and accountability.
6. Communicate Progress
Update your organization regularly on how well employees are meeting objectives. Encourage managers to take a proactive role helping employees achieve their goals. If one employee is struggling, you can help identify the root causes and even realign goals. Yes, sometimes goals do change. Even so, consider creating a one-pager for each employee that lists the associate’s goals, personal-development strategies, and the organization’s overall objectives. Place the one-pager in a spot that’s visible to the employee and refer to it during one-to-one meetings — not just during the annual performance evaluation period.
7. Tie Goals to Recognition
When employees meet their goals, they should be rewarded and recognized. It’s about positive reinforcement, but more importantly it shows appreciation for their contribution. For tips on employee recognition ideas, we’ve got you covered.
Tools and Resources for Effective Goal Setting with Employees
When it comes to setting employee goals, it’s important to have systems in place to support communication, measurement, and recognition to ensure employees stay on track. Effective tools and resources include:
Talent development software
With Paycor’s talent development software, managers can conduct efficient reviews based on historical performance data from one-on-ones, feedback, and goals. It includes progress tracking, reminders to help manage milestones, the ability to create and track shared team goals, and a recognition tool to celebrate accomplishments and encourage employees.
Learning Management System (LMS)
Many employees list professional development as a goal, and a learning management system can help. Employees can take free courses through platforms like LinkedIn Learning or Grow With Google. Or, you can consider an LMS that offers content personalized to your industry and company.
Collaboration and communication tools
Slack, Microsoft Teams, and Zoom offer features that support ongoing goal discussions, facilitate regular check-ins, and enable seamless communication between employees and managers about progress, challenges, and achievements — no matter their location.
Goal-setting frameworks and templates
Utilizing structured frameworks like SMART goals or OKRs can ensure clarity and alignment between individual and organizational goals. Many digital tools, such as Asana and Trello, also offer prebuilt goal templates that managers and employees can customize and use collaboratively.
Frequently Asked Questions
Still have questions about how to set performance targets? Read on.
Why Should a Manager Establish Measurable Performance Goals for Employees?
Without measurable goals, an employee is performing without clear direction. Not only can this result in missing important tasks or deadlines, but it also lowers employee morale and engagement. For the manager, they don’t have a way to measure the employee’s performance. Goals provide clarity for all parties.
What Are Some Common Challenges When Setting Goals for Employees
Common challenges and mistakes include setting vague or unclear goals, choosing goals that aren’t aligned with company objectives, having unrealistic expectations, and inconsistent monitoring (which allows progress to fizzle out).
To address these challenges, employees must learn how to write performance goals using the SMART framework. Goals should be specific, measurable, achievable, relevant, and time-bound.
What is the Role of Feedback in Achieving Performance Goals?
Feedback helps employees stay on track, recognize areas for improvement, and feel supported. Regular, constructive feedback fosters accountability and enhances performance by addressing issues early.
How Often Should Performance Goals be Reviewed?
This ultimately depends on the goal and your business needs, but performance goals should be reviewed regularly — typically quarterly or during scheduled one-on-one meetings — to assess progress, make adjustments, and ensure alignment with evolving priorities.
How do you Align Individual Goals with Company Objectives?
You can do this by building cascading objectives, in which each department and team member’s goals contribute to the same company objective.
How do you Measure the Success of Performance Goals?
Success is measured through key performance indicators (KPIs), progress toward milestones, and evaluating the impact of outcomes on team and company objectives. Regular tracking ensures transparency and accountability.
Paycor Supports Goal Setting for Employees
Goal setting and performance management are critical factors that support employee engagement. And an engaged workforce leads to improved products and services, happier customers, greater employee satisfaction, and a better bottom line for your organization. Paycor’s talent development solutions enable employers to handle goal setting and performance management responsibilities efficiently and effectively. For example, SimpleNexus, a technology company serving the mortgage company, automated many tasks and improved their performance management process with Paycor.
“Having a tool that can outline one-on-ones that tie directly into an employee’s goals, job description, and career path in one cohesive system has been really helpful,” says HR Business Partner Bri Mabey.
Learn how Paycor can help your business start the new year strong. Take a free guided tour.