With the start of a new year comes a wave of excitement for celebrating successes, making a clean break from unsavory memories, and the opportunity to start afresh. But much like new year’s resolutions, organizational goals and vision for the year can fail without the right approach. “It often has to do with misplaced energy. While we may have the right idea about what we want to improve, it is the ‘how are we going to achieve it’ piece that is lacking,” according to Forbes.
Setting goals effectively and using scorecards to track progress could mean the difference between looking back on 2023 a year from now with pride or regret. We’re sharing the critical information you need to make that happen.
What They Are
At every level of the organization, from the individual team member to the company as a whole, goals are critical to maintaining purpose and vision. “Successful companies set goals. Without them, they have no defined purpose and nothing to strive for; consequently, they stagnate and struggle for meaningful accomplishments.”
When a company has a clear target for what it wants to achieve, in the short and long term, its leaders and teams know where to set their sights. “Goal setting is a leadership performance management strategy for helping employees align their activities with organizational goals to achieve multiple positive outcomes.”
Though sometimes those higher-order goals can seem lofty and unattainable, they can be achieved by being broken down into bite-sized, measurable steps that can be then owned and shared by teams and individuals. Even elusive ambitions like employee engagement or culture can be distilled into more tangible elements like event attendance, turnover rates, and survey responses.
“Big-picture goals and objectives should be established at the company level first, and then cascaded down and aligned throughout the organization, so that every individual understands how their work impacts the company’s overall strategic objectives and revenue targets.”
For individual employees, knowing just how their projects and day-to-day tasks impact the overall success of the company in direct and even indirect ways gives them a deeper connection to their work. That translates to motivation and productivity.
“When done properly, setting goals can improve commitment materially and help clarify an employee’s role – the single biggest driver of organizational health.”
Scorecards are a key tactic for keeping individuals and teams on track for achieving their goals and maintaining visibility as well as accountability for the pieces they own. Built in the existence of a scorecard is regular conversations on progress, continuous alignment and visibility, and measurement.
“By utilizing a performance measurement system, such as a balanced scorecard, an organization commits to assessing performance, monitoring performance, course-correcting performance and aligning all employees with key objectives. Therefore, whether an accountable leader or a staff member who performs the work, employees all have a method to assess progress, ascertain the improvement and make changes if required.”
They also help team members to understand and visualize how individual workflows and projects contribute in a variety of ways to accomplishing organizational goals, beyond revenue generation or units sold.
“They realize that no single measure can provide a clear performance target or focus attention on the critical areas of the business. Managers want a balanced presentation of both financial and operational measures.”
Why You Need Them
In addition to giving you a built-in agenda for weekly status meetings, effective goal setting and scorecards produce numerous benefits that contribute to your overall success.
Alignment: When individual and team goals contribute to broader organizational goals, it not only increases your chances for success but also encourages investment and ownership over performance and productivity. “Organizational purpose becomes personal when the employee recognizes that their unique contribution furthers that goal.”
With so many employees working in hybrid or fully remote environments, measuring performance and engagement has grown more challenging, but by showing the direct impact their work makes on company success demonstrates the value of their efforts, promoting a strong sense of belonging and loyalty. “By connecting goals to purpose, you are providing a reminder of and a boost to employee internal motivation and engagement.”
Even during times of change, by infusing meaning into regular check-in conversations with managers and reevaluations of goals, a tool like a scorecard can be critical in maintaining alignment in high-risk situations.
“Personal purpose requires regular conversations about the unique contributions individual employees make in their day-to-day work. And without proper maintenance, an employee’s personal purpose can become unclear as change occurs.” Gallup
Productivity: In the age of more data than we know what to do with, it’s well known that tracking performance and relevant metrics are key to progress. After all, “What you measure is what you get.”
Scorecards that facilitate discussions to keep individuals and teams on track and aligned to goals also provide a structure for recognizing when trajectories are off, progress is slowing or halted, or when goals need to be reassessed. In particular, they equip managers to coach their teams in more meaningful ways by recording the impact each employee is making over time.
“Goals help us modify and create new behaviors. Goals provide focus, direction, purpose, and clarity. In other words, goals are critical for employee and company growth.”
It’s also well established that this kind of alignment is a major contributor to productivity and performance. “Research has shown that teams who set goals obtain 20%–25% improved work performance! In addition to improving their performance, people who set goals have more self-confidence, are less stressed and are happier and more productive at work.”
Gallup’s research analyzed the impact employee engagement has on business outcomes:
- 28% in shrinkage (theft)
- 64% in safety incidents (accidents)
- 41% in quality (defects)
- 10% in customer loyalty/engagement
- 18% in productivity (sales)
- 23% in profitability
How to Use Them
Scorecards and meaningful, reasonable goals are useful for achieving all key strategic initiatives. By breaking down aspirational, and at times somewhat abstract, organizational goals into smaller, achievable and measurable milestones, teams and individuals can contribute to progress and success.
Keep these things in mind as you put these critical tools into use:
Build Trust
Ensuring your goals not only ladder up to team and organizational goals but also that they are clear, attainable, and relevant builds and maintains trust with your employees. It provides a level of transparency around why they’re assigned to specific projects, their value and impact as a team member, and performance measurement. Expectations are clear, managers and direct reports can worry less about initiating these types of conversations that can be awkward.
“When an organization is more transparent with their employees, they tend to be more successful in several areas: they have increased employee engagement, stronger company culture, and transparency fosters a type of comfort that allows employees to freely communicate.”
Trust enables employees to feel they can be themselves at work, put in hard work without feeling taken advantage of, and are cared for as a professional and a person, not just as a cog in a machine.
Build on DEI Efforts
Diversity and inclusion (D&I) has evolved to include additional aspects like equity, and the next iteration to keep in the line of sight is DEIB: diversity, equity, inclusion, and belonging. As organizations continue to learn how they can work toward representation and fairness, they must learn how to infuse empathy to help their employees feel a strong sense of belonging.
This is critical for reducing turnover and accelerating recruiting. “97% of workers consider empathy as an essential quality of a healthy workplace culture, and 92 percent said they specifically look for organizations that demonstrate empathy when seeking a job.”
And the impacts are far reaching. “Companies that don’t employ empathy to make their workforce as diverse and inclusive as possible also miss out on the creativity and collaboration benefits of a more welcoming culture […] DEIB is not only the right thing to do, it also makes good business sense.”
Companies must apply its DEIB strategies to every aspect of the business, including nontraditional or gig workers and even vendors. “Assessing your vendors’ commitment demonstrates that you take diversity and inclusion seriously […] Investigating your vendors’ commitment to diversity and inclusion is not just necessary from an ethical standpoint but from a competitive perspective as well.”
Build a Strategy for the Future of Work
As the Future of Work continues to evolve and shift, maintain goals that consider key elements like your talent pipeline and flexibility. Putting strategies and initiatives in place that seamlessly integrate and establish processes for nontraditional or gig workers, for example, keep your business agile as in-demand skills change and gaps emerge.
Creating plans for flexibility, from schedules to responsibilities, allows your teams and managers to adapt to changing organizational needs as well as individual career growth and personal needs. In fact, flexibility is a key element of human-centric leadership: “Enable flexibility and support that fit the unique needs of team members.”
As organizations create scorecards in these key areas, identifying the right metrics that truly track progress—and reevaluating as needed—will be important for keeping success in the line of sight and maintaining effectiveness in those areas. “Only by understanding people data will companies truly be able to measure workplace effectiveness, thereby making the best use of their greatest investment: their people.”
Get Going
One of the most critical ingredients to establishing goals and using scorecards effectively is to remember that they are meant to evolve. “Moving forward, organizations must build flexibility into the goal-setting process so employees can evolve their goals as their roles and the business change. Have employees review their goals with their manager quarterly, at minimum, as well as at the start of the year. Help managers and employees identify triggers for adjusting goals, including changes in company or business unit financial performance, staff turnover or technology advances.”
Especially when considering organizations are moving to a more people-centric approach to business, minds must be kept open to adapt to new learnings. And as culture and engagement are major contributors to success, they must move from abstract to concrete.
As workplace culture expert Jessica Kriegel puts it, “Culture is not soft. It is not unmeasurable, nor is it intangible. In fact, culture is a simple, hard skill. It’s very measurable and it’s acutely tangible. If you want your business to succeed, if you want sustainable growth for your organization, your culture must support your goals.”