Rise Performance Group

Are Employee Performance Goals Worthless?

By Sally Ann Moyer

You probably began your day by evaluating your to-do list. In some way or another, you thought about what you wanted to accomplish and how to go about it. As the holidays approach, you’re probably trying to make sure your company surpasses its year-end employee performance goals. But what happens if your employees fail to reach these goals? It might be time to reconsider why you set goals in the first place.

Planning for the future is so important that the self-help world has even invented its own research, the mythical Yale Study of Goals. This legendary study reports that the 3 percent of graduates from the 1953 class who set goals ended up earning more over the course of their lifetimes than the other 97 percent combined.

Unfortunately, there’s no evidence that this study ever existed. We’re still drawn to it, though, because we see “the power of goals in raising performance,” according to a Forbes.com post about goals. We want the study to be true because setting goals sounds like an easy and straightforward path to success. In reality, company success is rarely as easy as one strategic planning meeting alone.

Sometimes, goals can backfire. There’s even evidence to suggest that “goals do more harm than good,” according to a recent Fast Company article. The real problem is our over-fascination with goals. We are easily “preoccupied with plans” to the point that we lose sight of the here and now. Goals become dangerous when we focus on the future at the risk of ruining the present.

Consider the 29 campaign set forth by American automobile company General Motors at the turn of the millennium. Executives at GM’s headquarters in Detroit announced a plan to recapture 29 percent of the American car market. Senior figures at GM wore small gold lapel pins with the number 29 and it showed up everywhere at corporate gatherings and on internal documents. The obsession dwindled into bankruptcy and GM announced at the 2010 Detroit Auto Show that the twenty-nine campaign was an example of a goal-setting practice it would never use again.

Should you take this as a lesson to give up on goals? There has to be some value to employee performance goals. The 29 campaign failed because it became an obsession that trumped other company needs in the midst of the economic recession. Strategic planning is about evaluating the big picture and developing courses of action to take your company and employees to the next level. Help employee performance goals from becoming worthless by following these three guidelines:

strategic planning1. Keep the big picture goal general.
Trying to regain 29 percent of the marketplace became an advertising campaign to push consumers into purchasing the products GM already produced instead of evaluating what GM could do differently. Setting the goal of a specific number made it unreasonable. While regaining 28 percent of the market would still be successful, the 29 campaign would have counted this as a failure. Goals should be “difficult but not dauntingly impossible.” Think about characteristics you would like your company to have or skills you want your employees to improve. Use your goals as a source of inspiration.

2. Get specific with the details.
Make goals relevant by evaluating what can be done now to achieve them. The fact that you set a goal implies that something will need to change in order to accomplish it. Inspirational goals can boost performance when they become associated with specific daily tasks. For example, a 2011 meta-analysis of 38 studies revealed that asking for 10 ideas was stronger than asking for 8 to 12, even though 10 falls within that range. Employees need to chart what specific steps will make their general long term goal a reality. It’s more difficult to think about what you need from your employees on a daily basis than to set one lofty goal. However, this is what effective management is all about—regularly checking in and asking, “Where do I go from here?” This keeps goals in mind without employees getting lost in the goals.

3. Let feedback shape your goals.
External factors will promote and, sometimes, hold you back from your goals. What happens if an employee gets sick or a product launch fails? If you’ve stayed specific in the present but general for the future, it will be easy to move onto a new course of action without giving up on your ultimate goals. Adaptable goals are effective goals. Communicate with your employees to find out what’s working, and drive away poor performance with continuous evaluation. This will help you from the danger of “attaining your goals at the expense of ruining your life.” GM did not leave any flexibility for its employees with its 29 campaign. Remember that redirection is more progressive and encouraging than failure.

How do you keep goals from controlling your life?

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