Performance Measurement

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Key Idea

Your objectives represent what you want to accomplish in order to improve various aspects of your group's performance. To brainstorm ideas for objectives, meet with colleagues and direct reports in your group and ask the following questions:

• What does our group hope to accomplish by measuring performance?

For instance, does your group hope to identify solutions to recurring problems? Improve overall process efficiency? Determine rewards for particular levels of employee performance?

• What must our group do to help carry out our company's strategy?

For example, if your company's strategy centers on operational excellence (improving efficiency), you might set objectives for your group such as "Increase sales revenue per employee," "Lower indirect costs," or "Reduce workplace accidents."

• How might we better serve our customers? Whether your group serves internal or external customers, think about how you can provide them with greater value.

For instance, if you lead an HR group, your objectives might include "Develop future leaders in the organization," "Help managers retain talented employees," and "Foster a collaborative culture." If you lead a product development group, your objectives might include "Increase innovation," "Update products more frequently," and "Make products easier to use."

• How might we improve our work processes? Sometimes process problems can be translated into ideas for objectives.

For example, suppose you lead a group in the accounting department and your direct reports tend to have difficulty meeting deadlines. In this case, you might define objectives such as "Complete accounts receivable reports on time," "Pay vendors according to their terms," and "Process employee expense reimbursements on schedule."

• What new skills or knowledge do we need to excel? Objectives for improving your employees' skills and knowledge might include "Take advantage of more training opportunities," "Improve knowledge sharing," and so forth.

After brainstorming ideas for objectives, review your list and identify the most important ones—those objectives that most directly affect company and unit strategy or that will help you solve serious performance problems. Try to whittle your list down to a manageable five or seven objectives.