A couple of weeks ago, I had a chat with a senior manager for a service company about performance measurement. Over the conversation, he expressed his hesitation about setting performance targets.
One of his concerns is that his team would be discouraged if they aren’t able to meet the target. So he has been dragging his feet on it.
Target setting is all about the mindset you want to cultivate.
It is true that it could be discouraging when the target couldn’t be met. But you do yourself a disservice when you don’t set targets because targets do 3 things for your business.
By setting a target, you
- Highlight a result that is important for the business
- Formalize a goal that everyone works toward
- Send a message about priorities
Without targets, you run the risk of conflicting actions and decisions. If you are concerned about whether a target is too ambitious, consider setting two targets. One that is reasonably achievable based on past performances and a stretch target that you believe would amplify success.
Be open about how those targets are set. That way, you cultivate a mindset that all work serves a purpose and it is the results that count at the end.