Effective performance management relies on setting the right employee performance goals. They are what forms its solid foundations. Get these wrong and the whole framework will be off-balance, likely to lead to disputes, disagreements and ultimately failure.
The Sydney Opera House is world famous. Millions of people who have never set foot in Australia recognise its distinctive design and it is visited by almost 11 million people each year. It has certainly achieved one of the main objectives of the state government of creating a cultural icon that puts Sydney on the map, but in other areas it has been far from an unmitigated success.
The project vastly overran, taking 14 years to complete, rather than the planned four, there were huge communication issues between the architect, Jorn Utzon and the construction company and the original design needed extensive reworking to support the iconic sales of the design. The failure to set clear objectives around management and resources meant the project was hugely wasteful and went way over budget.
On top of this, the Opera House has also failed to meet the key objective of being an outstanding music venue. Until extensive renovations were completed in 2022, the concert hall had famously poor acoustics that meant top musicians shunned playing there. During construction this goal got lost, style overtook substance. Changes in personnel and a lack of clear guidance, meant this key objective was not reviewed and kept top of mind.
Many of Opera House’s problems could have been avoided if clear objectives had been agreed at the outset of the project amongst all stakeholders. This would have made sure everyone knew what was expected and had a framework to gauge the project against, quickly spotting when the project was going off track and allowing prompt action to be taken.
Few organisations will be taking on projects of this size and scale, but its failures clearly show just how expensive and time consuming it is not to set and then review relevant and achievable objectives.
Avoiding objective setting and review pitfalls
Effective performance management relies on setting the right objectives. They are what forms its solid foundations. Get these wrong and the whole framework will be off-balance, likely to lead to disputes, disagreements and ultimately failure.
Here are our tips for making sure your employee performance goals work for both your business and your employees:
- Objectives need to be SMART – specific, measurable, achievable, relevant and timed. Make sure you know what this means in practice, our handy guide can help.
- Understand what the overall objectives of your business are for the period your objectives will run for and how your team or department can best contribute to them. Aligning your efforts with the rest of the organisation will ensure everyone is focused on pulling in the same direction.
- Create objectives in collaboration with employees. Encourage them to think about their own strengths, interests and skills and what they feel they can best offer to the business.
- Circumstances both externally and within an organisation change constantly. This means objectives may need to be adjusted to remain relevant. Make sure you hold regular reviews with employees where you can discuss objectives, offer support to help tackle issues and track progress. It should never be the case that objectives are set and then not discussed again until the end of period review.
Closing the circle – end of period reviews
As important as setting SMART employee performance goals, is checking they have been completed. Whether this is over a year, half year, quarter or any other time period, it provides a chance for closure and reflection. It is vital that employees know their objectives have meaning and that they provide a clear indication of how well they are doing their job. It also helps to create realistic timescales for projects and highlights where things are running way over time.
An end of period review is a fantastic learning opportunity for both managers and employees. It is a chance for both to honestly and openly discuss what has worked well, what could be improved and look forward to the future. Understanding strengths and addressing weaknesses is vital for growth and development.
Encouraging better conversations
To help you get these two vital elements that underpin performance management right, we’ve developed check-in templates for you to follow and adapt to your own business. These form part of our suite of templates to help every type of check-in conversation that is likely to happen between line managers and employees. Take a look at our resources library to discover what else is on offer.
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