5 Reasons For Setting Employee Performance Targets

Each year around this time, I work with my employees to establish performance targets for the coming year.  It can be a little challenging to fit everything in before the end of the calendar year.  But target setting is vital to business success and individual performance.

Here are 5 reasons for setting employee performance targets:

1. Individual performance goals give employees a target.  An employee can go about every day business without written goals, but they shouldn’t expect growth without targets. If employees don’t have written targets, they will hit them every time.  Written targets help provide employees with a clear plan for how to succeed.  Targets work best when they are SMART (specific, measurable, attainable, realistic, and time related).
2. Individual performance goals help employees contribute to overall business success.  Individual targets should be written in alignment with overall business objectives.  For example, if achieving a specific sales order intake is a business objective, individual sales people should have targets that contribute to the overall order intake goal.
3. Individual performance goals provide a fair method for comparing team member performance.  For example, I have 8 project managers working for me.  They have similar targets based on their responsibilities as project managers.  Because their targets are similar, I can evaluate their year-end performance more fairly.  Since their targets are SMART, they are measurable.  It becomes easier to measure one’s performance against another’s performance when performance targets have been developed at the beginning of the year.
4. Individual performance goals take the surprise out of end of year performance ratings.  I sit with my team members at least once a quarter to go over their performance on their individual targets.  By doing this regularly, they have opportunities throughout the year to address performance short falls.  By the end of the year, there is little surprise when the results are revealed for overall performance.
5. Individual performance goals provide an employee to communicate career aspirations to their manager.  As leaders, we should be asking our employees about their career objectives on a regular basis.  And we should work with our employees to craft unique goals which will help them prepare for meeting these objectives.  In some cases, this may mean some honest feedback – just because Jack wants to be president of the company someday does not mean he will meet this target.  Still, we can point our employees in the right direction.  We have a responsibility to help our team members succeed.

This should be a fun month as I work with each of my team members in setting their individual performance targets.

What other reasons can you provide for setting individual performance targets?  How have performance targets helped you as an employee or as a team leader?

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