I wrote last week that goals are set to help align the behavior of teams or individuals towards the overall organizational mission (read the previous post here). When goals are aligned with the mission, everybody on your team will be working in the same direction – their actions which meet their goals, will support the organization as a whole.
Goals as a Performance Management Tool
Goal-setting is one of the main aspects of performance management. Having goals to work towards helps to clarify priorities. Additionally, goals help leaders determine the performance of teams and individuals, creating opportunities for continuous improvement.
SMART goals
We also know that the best goals are SMART goals – Specific, Measurable, Achievable, Relevant and Timebound. Notice the word relevant here. That confirms that goals should be related to the strategy, which is in place to help the company achieve its mission.
The other four components of SMART – specific, measurable, achievable and timebound – tell us how to enforce the goals. After all, there’s no point in having goals if nobody is accountable for hitting them. Imagine a sales team that never hits any of its quotas, ever. That is not sustainable.
Indeed, if goals are not SMART, they tend to be demotivating. Metrics-based goals guide performance, so there is a certain “garbage in, garbage out” aspect to goal-setting. If they are not relevant, then effort is wasted. If they are not specific or measurable, there is risk that effort is wasted. If they are not timebound, there is no urgency, and if they are not achievable, then there is no motivation to try.
Scorecards and Goals
Goals, therefore, require an enforcement mechanism, in order for them to have genuine value to the organization. This is where scorecards come in.
Each individual’s scorecards should reflect their goals. If the goals are set in a SMART manner, this should be fairly straightforward, because you’ve already established what the goals for each role are, and the pursuit of these goals will contribute to the organization achieving its mission.
A helpdesk technician might have a goal of having a CSAT score over 95. You wouldn’t set it at 100 because perfection isn’t reasonable when they are being evaluated by a client, but you also want to make sure that they are oriented towards a very high standard of service, so you can’t set this goal too low, either.
Individuals can also be held to team goals, in instances where it is necessary to foster teamwork. For example, if a helpdesk has a goal for first call response rate under 1 hour of 100%, that goal can appear on the scorecard of all team members. Doing so creates shared responsibility for achieving the goal.
Weighting Goals
One of the trickier aspects to shared goals is that the relevant part of SMART implies that the goals on someone’s scorecard should be reasonably within their ability to control or impact. Each KPI on the scorecard is weighted, and the weightings should reflect how much control that person has over that KPI.
Organizational Goals on Individual Scorecards
The same helpdesk tech who makes a direct impact on the first call response rate, has significant influence over organizational profitability. A KPI like profitability might be weighted at 5% because you want it to be on that person’s mind, but with a low enough number that the individual’s performance review is not significantly impacted by things outside of their direct control.
Using Goals and Scorecards in Leadership
Goals, and the scorecards on which they live, are an effective management tool. It’s worth taking scorecards a bit further, into the realm of leadership. For example, a sales team that can’t hit its quotas might still be a good sales team – a manager may worry about the quota, a leader worries about the people.
After all, consistently missed quotas could mean many things – maybe the quotas aren’t achievable (a leadership problem). Or it could be a matter of poor lead quality (a marketing problem). Perhaps the service is not competitive (a service or positioning/pricing problem). Or perhaps the sales team just isn’t that good. A sales leader will be able to work with their team, and collaborate cross-functionally, in order to get to the root causes of the missed quotas.
Individual vs Role in Scorecards
One tricky area for scorecards is how much to assign to the role, and how much to assign to the individual. While a role may not change much over time, the individual should be encouraged to learn, to grow, and to expand their contributions. It is recommended to set aside a percentage of the scorecard to the individual – perhaps 10-20% – to encourage individual growth beyond their specific role. Doing this ensures that the individual is not viewed strictly as a cog in the machine, but as a human being, whose motivations may well go beyond their present level of contribution.
What Makes a Scorecard Successful?
A successful scorecard has the following attributes:
- Describes what the organization wishes the employee to do
- Reflects goals that are motivating
- The employee understands what they are to do
- The employee and organization both feel that the employee is fairly evaluated
- The employee is engaged in their work, knowing the value they bring to the organization
Getting to this level of alignment requires intentionality. Too often, scorecards get misaligned because they reflect something of a spaghetti-on-the-wall approach to goal-setting. Unfortunately, what happens is that the employee ends up demotivated, because they are measured on things that aren’t part of their role, or over which they have minimal influence or control.
What this means is that goal-setting and scorecards should not be etched in stone. A role may stay the same quarter-over-quarter, but the goals associated with that role should be subject to continual review and adjustment. As an employee or team gets better, their goals should reflect their increased capabilities.
A Final Thought
There’s nothing easy about configuring scorecards. It’s a big challenge for many leaders, even experienced ones. The key is to understand how the role contributes to the greater mission and vision. Then, goals on the scorecard can reflect how that employee or role will contribute. As a leader, goals provide you with targets, KPIs provide you with a measure of achievement against those targets, and scorecards provide you with a means to identify individual strengths and weaknesses. But the set of scorecards for your team, taken as a whole, also have value in identifying gaps in your organizational structure…by formalizing scorecards you can identify these gaps and either hire or train to fill them. Which is to say that scorecards aren’t just about individual performance, but they also equip you as leader to make adjustments for the benefit of organizational performance as well.
