objective setting

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Objective SettingObjective Setting

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Why MBOs?Why MBOs?

Managers should avoid the « activity trap », getting so

involved in their day to day activities that they forget their

main purpose or objective.

MBOs aim to increase organizational performance by

aligning goals and subordinates objectives throughout the

organization

However, “It’s just another tool. It is not the great cure for

management inefficiency…MBO works if you know the

objectives, 90% of the time you don’t.” (Peter Drucker

1993)

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MBO Principles are :MBO Principles are :

Cascading of organizational goals and objectives

Specific objectives for each member

Participative decision making

Explicit time period, and

Performance evaluation and feedback

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Steps in Management by Objective (MBO) Steps in Management by Objective (MBO) ProcessProcess

Explain goals for department or group in joint meeting

Agree on objectives for next planning period with each employee individually

Review subordinate objectives at target dates

Review results for period and establish goals for next period.

Begin process again

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Key Elements of an ObjectiveKey Elements of an Objective

An objective:

– Is a specific and measurable description of a specific performance

– Describes the intended result – the ”how much or what by when”

– Is jointly agreed and prioritized between the Manager and Employee.

– Should be set at the beginning of the appraisal period.

– Should be reviewed regularly to ensure they remain relevant

– Provides a framework of measurable performance standards for individuals to work towards within an agreed timescale.

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On the Road to Success...On the Road to Success...

SpecificMeasurableAchievableResult-orientedTime-limited

Set clear SMARTSet clear SMART expectationsexpectations

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SMARTSMART

Specific

• Exactly what is my objective?

– A specific outcome has to be accomplished– Ensure there is no ambiguity in the objective– The outcome is stated in a clearly defined manner– Be specific with a single key result

– Vague, too many objectives

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SMARTSMART

Measurable

• What would a good job look like?

– How will you know he/she have progressed– Is there a form of measurement in the objective?– If possible, state the objective in a quantifiable manner– Action verbs are observable and better communicate the

intent of what is to be attempted– e.g. to write, to apply, to install, to select, to assemble, to develop…

– Lack of performance criteria – If cannot be measured it will be difficult to assess– Avoid statement of objectives in generalities– Infinitives to avoid include :

– to know, to understand, to believe…

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SMARTSMART

Attainable

• Is my objective feasible?

– Must be achievable with the given market conditions, time period and resources allocated.

– It must be realistic– What barriers stand between you and your objective?– How will each barrier be overcome and within what

time frame?

– Too easy or too difficult

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SMARTSMART

Result-oriented & relevant

• Is my objective meaningful?

– The objective should be central to the goals of the organization

– The successful completion of the objective should make the difference

– How will this objective help the organization move ahead?

– Is the objective aligned with the mission of the organization?

– Not linked to department priorities– Resources not available

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SMARTSMART

Time limited

• Is my objective traceable?

– Enable time to be set– Time to be used on objectives that really matters– Are the time lines realistic?– Will other competing demands cause delay?

– No deadlines

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How How SMARTSMART Is This Objective? Is This Objective?

Financial support:• Administer the financial operations of the unit within

budget constraints.Smart version:• For November 1st, develop and start providing

monthly status report of the unit’s financial operations, based on the agreement with the Director. Monitor the gap between the budget and the year-to-date revenues and expenditures, while providing suggestions to improve the unit’s financial management.

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10 Tips for Setting SMART Objectives10 Tips for Setting SMART Objectives

Sort out the difference between objectives and aims, goals and/or targets before you start. Aims and goals etc relate to your aspirations objectives are your battle-plan. Set as many objectives as you need for success.

SMART stands for Specific, Measurable, Achievable, Realistic and Timely.

Don’t try to use that order. M-A/R-S-T is often the best way to write objectives.

Measurable is the most important consideration. You will know that you’re achieved your objective, because here is the evidence. I will know too! Make sure you state how you will record your success.

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Achievable is linked to measurable. Usually, there’s no point in starting a job you know you can’t finish, or one where you can’t tell if/when you’re finished it. How can I decide if it’s achievable?

– you know it’s measurable– others have done it successfully (before you, or somewhere else)– it’s theoretically possible (i.e. clearly not “not achievable”)– you have the necessary resources, or at least a realistic chance of

getting them– you’re assessed the limitations.

If it’s achievable, it may not be realistic. If it isn’t realistic, it’s not achievable.You need to know:

– who’s going to do it?– do they have (or can they get) the skills to do a good job?– where’s the money coming from?– who carries the can?– Realistic is about human resources/time/money/opportunity.

The main reason it’s achievable but not realistic is that it’s not a high priority. Often something else needs to be done first, before you’ll succeed. If so, set up two (or more) objectives in priority order.

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The devil is in the specific detail. You will know your objective is specific enough if:

– everyone who’s involved knows that it includes them specifically– everyone involved can understand it– your objective is free from jargon– you’re defined all your terms– you’re used only appropriate language.

Timely means setting deadlines. You must include one, otherwise your objective isn’t measurable. But your deadlines must be realistic, or the task isn’t achievable. T must be M, and R, and S without these your objective can’t be top-priority.

It is worth this effort! You’ll know you’re done your job well, and so will others.

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Benefits of Objective SettingBenefits of Objective Setting

It sets specific targets for the employee to achieve which are linked to Business / Development Plan

It states how the performance of the employee is to be measured to assess progress

It provides direction for the employee

It allows progress, targets and successes to be monitored and measured by the manager.

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Benefits of Objective SettingBenefits of Objective Setting

It helps build working relationships between the employee & the manager, and improves overall communication

Helps to focus on a specific task

Increases staff motivation

Helps to Prioritize

Allows reviews to be undertaken

Enables success to be measured

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What not to do!What not to do!

Don’t set vague objectives Everyone will have trouble interpreting & measuring them

Don’t set vague or unrealistic targets

This will demotivate the employee – can’t help but not achieve the objectives

Don’t impose objectives Everyone must agree to objectives and take ownership for them

Don’t make the process to complex or bureaucratic

Needs to be easy to use and relevant. Keep it Simple.

Don’t forget to refer back to the objectives regularly

Otherwise they are irrelevant and a waste of everyone’s time and energy. Employee will potentially be demotivated at wasted effort and lack of interest in their progress.

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Acid test of MBOsAcid test of MBOs

Better no MBOs than bad MBOs

• Consider what incentives you are giving employees in each objectives.

– Will the objective point to the employee in the direction of serving customer better?

• Ask yourself what signals you are giving with each objectives

– Are you directing employees toward what is most important?

• Specify the objective, but leave the means of achieving it to the individual.

– You don’t want to be a micromanager, do you?

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Leadership & ManagementLeadership & Management

Seven Habits model - Steven Covey

• Be proactiveControl one’s environment, rather than have it control you, as it is often the case

• Begin with the end in mindNeed to be able to see the desired outcome and concentrate on activities which help in achieving that end

• Put first things firstManagers need to personally manage themselves and implement activities which aim to achieve the desired outcome.

• Think win-winThis is the most important aspect of interpersonal leadership because most achievements are based on cooperative efforts

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Leadership & ManagementLeadership & Management

Seven Habits model - Steven Covey (continued)

– Seek first to understand and to be understoodDeveloping and maintaining positive relationships through good communication

– SynergizeCreative cooperation. Work as a group to attain a purpose

– Sharpen the sawLearning from previous experience and encouraging others to do the same

objective setting

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