It’s that time of the year: January, the month associated with setting new year’s resolutions on a personal level but also with setting organisational targets for many businesses. It’s the first month of the year when company missions are usually revisited and the performance bar has been raised after the previous year’s profit and loss accounts have been calculated. These new annual organisational targets need to be communicated to all employees and cascaded down to each department. Then they need to be translated as personal objectives for each individual that plays a role in achieving results for the company in such a way that each person can relate to them.
A number of years ago, I experienced first-hand a very poorly conducted appraisal system. I had not been given specific annual goals to work towards to by my manager and was just told at one point towards the end of my first year of employment that I would be appraised two days later. I was given no guidelines so I had no way of preparing for the meeting. On the day of my appraisal I was simply shown a list of criteria which I was unaware of before and was scored (against a rating scale I had not seen before) by my manager against each one of those. I was not even asked to reflect on my own performance against those criteria. I was working for an international company but was completely unaware of the company’s mission and main objectives. I was kept in the dark by my manager as to what were the plans for my department. Neither the company’s nor the department’s objectives (if indeed there were any specifically set at the time) were communicated to me during my appraisal. There had been no one-to-one meetings during the year to go over my performance or to be given specific feedback on any critical work incidents. Thankfully, my performance was deemed satisfactory at the time. However, this was the poorest example in my working experience of how performance should be managed.
I was also shocked and disappointed by another organisation I worked for when I found out that their appraisal system consisted of evaluating employee performance solely on their job description! How can you expect performance improvements when you are reviewing people’s performance against the minimum expectations of their role? By just looking at their main duties and responsibilities but not having specific and measurable personal targets to emphasise what’s important from one year to the next?
One of the most important elements of a successful performance management system is for people to know what their performance is actually evaluated on. This usually is done through individualised objectives, which in more HR-sophisticated organisations are often combined with a review against the competencies most valued by the organisation. Some companies also like to add some developmental objectives in their performance management system. This shows the emphasis they place in learning and development and their support for their people’s growth. Appraising someone only against their job description simply won’t cut it!
So why are objectives important in performance management? Because simply put they provide clarity and purpose with emphasis on achievement, growth and development.