December 2005

TO ALL CLIENTS, FRIENDS, AND ASSOCIATES:

 

        

MAKING 2006 TRULY PRODUCTIVE

 

By Tony Mulkern

           This is the season for businesses to set goals and objectives for the coming year. So it is worth reviewing how to make this a motivating and productive process.  Nothing is more demoralizing than for objectives to go the way of New Year’s resolutions—quickly forgotten and rarely achieved.

When writing objectives for 2006 here are a dozen points to help make the exercise productive.

  • Focus on an identifiable target or result. It should be clear when the objective has or has not been achieved. For example, the following objective is poorly worded: “to increase sales of products A, B, and C ten percent during the coming year within the existing sales budget.” Would failure to achieve the objective for any one product mean failure to meet the total objective? It is not clear.  If each of the three products is to have a sales target, then each should have a separate objective and perhaps a separate action plan. If not, and if one person can be held accountable for the sales of all three products, then the objective should read, “to increase total sales of products A, B, and C by ten percent during the coming year...”
  • Set a time target. Each objective must be time-bound, that is, include a stated completion date. Target dates should usually also be set for milestones in the action plan.
  • Write the objective in terms of measurement and verification, to the extent possible. The usual quantifiers that apply, in addition to time, are quantity, quality, or cost. Not all apply to every objective, but if none apply it is probably a poorly written or trivial objective. In objective-setting, the rule of thumb is, “if it cannot be measured, it is not important.

  • Remember, measures of cost such as dollars, work hours, raw materials, etc., provide a basis for establishing priorities and evaluating how efficiently the objective was accomplished. A common frustration for CEOs with IT objectives is that they often seem to be a bottomless pit in terms of required work hours. One solution: make accomplishment of the objective within an agreed upon time frame and budget key measures of successful completion, tied to consequences. More about this at the end.
  • Set targets for outputs, not inputs. “Improve communication skills,” for example, is not a sound output for a CFO. Improving scores on 360 degree feedback or employee satisfaction surveys is more meaningful. More skilful communication is a means to these ends, which can be appropriate objectives.
  • Make it challenging to the organization or person. The objective represents an improvement over past performance and the end of the status quo. It should provide strong motivation to stretch beyond current levels of performance. This means it needs to be tied to the organization’s mission, values, and strategy and represent an exciting accomplishment.
  • Also make it realistic and attainable. The objective must be within the organization’s or person's competence or represent a reasonable learning and development experience. It must also be within the person's scope of authority, such that he or she can control or influence the results.
  • Is it relevant and important? Since resources are limited, one must choose among various potential targets. The attainment of the objective should provide a high payoff to the organization compared to other possible objectives.
  • Make sure each objective is consistent with organizational plans, policies, and procedures. If there is a conflict, either the objective or the current practice will have to give. An assessment may be necessary to determine which.
  • Put each objective in writing for future reference. To be effective, the objective needs to be referred to periodically by the executive—or others who may set them—as well as those who are involved in its accomplishment. Terms need to be understood by all who will play some part in the action planning, implementation, and review process. The “who,” “what,” and “how much” need to be clearly stated as well.
  • Check to be sure multiple objectives support and coordinate with one another.  This applies not only to each individual’s own objectives, but also to the multiple objectives of different persons.  Team members and co-workers need to be aware of interdependencies among their objectives.  A ten percent increase in sales may require a ten percent increase in production and additional hiring.
  • Write an Action Plan to accomplish the objective.  What are the specific steps needed to hit the target?  When will each be taken?  What resources are needed?  What obstacles can be foreseen?  Is there a “Plan B” in the event of major obstacles?  Writing the action plan is hard work and usually not as exciting as designing the objective.  This is why it is frequently not done and why so many objectives are not achieved.  Remember, an objective without a plan is simply a dream or a fantasy.

 

  • Finally, establish consequences, as mentioned earlier.  While not a part of objective setting itself, it is absolutely fundamental to its effectiveness.  If everyone gets the same pay, bonuses, raises and job security whether objectives are achieved or not, the message is clear—objectives are not important.  Establishing significant consequences at the outset means there is likely to be considerable debate over what is truly realistic and attainable and what support is needed.  This is healthy though often tough, hard work for the team leader.  Open-mindedness to dissent and a willingness to treat mistakes as learning opportunities help to create over time the trust needed for honest, productive discussion.

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Copyright, Mulkern Associates, 2005
 
   
 

 
Mulkern Associates is a privately held consulting firm of Anthony J. Mulkern