by Operations Goals
Operational goals define the routine tasks that are necessary to run an organization. When a company functions efficiently, employees are more productive and can reach their full potential. Profits can be made. Setting operational goals lets you manage a business, allowing it to grow in a scalable manner.
Regardless of the phrases you use, operational goals are items an organization wants to accomplish over the course of one to two years. They are (typically) defined by these characteristics:
- Limited to a single department or division
- Associated with a budget
- Tracked to see “what you get” with the budget you have
- Measurable and actionable
- Shorter time frames
Linking Operational Goals to Strategic Goals
A strategy is a high-level plan to accomplish items of key importance for your organization over the course of three to five years. Strategic goals are the building blocks of a strategy. They can be organized in multiple ways: by perspectives (financial, customer, internal process, and people) or by division and department.
Operational goals should be ingrained in every area of your strategic plan. You won’t be able to achieve your strategy otherwise. If you have too many operational goals tied to one strategic goal and not enough (or any) tied to another, consider shifting resources and prioritizing your operational goals differently.
Also, you may have operational goals and plans aligned by department, such as a marketing operations plan, customer success plan, product development plan, etc. Check all your work plans to make sure they cover all your strategic goals.
Setting Goals Vs. Setting Targets
An important distinction to make here is that goals are different than targets. We’ve established that operational goals specify (in a measurable way) the short-term tactics an organization will take to achieve its strategy. Targets are tools that allow you to define expected progress in even smaller steps that align with the details and deadlines of operational goals. More specifically, targets are typically set by quarter throughout the one- to two-year time span of an operational goal.
Operational Goals and Projects
A strategic plan has clearly defined goals, measures, and projects. Your strategic projects contribute to your goals so you can improve your measures. When you’re doing operations planning, operational goals and projects will be intermixed—and that’s perfectly normal. Similar to how goals and targets can overlap, so can goals and projects. Sometimes you’ll measure a longer term operational goal, like improving miles and miles of paved roads; and sometimes you’ll track and measure a shorter project, like widening a bridge. From a strategy standpoint, the bridge widening will look like a project, but from an operations perspective, it’s both a goal and a project. Ultimately, a lot of your activities will directly or indirectly link to your strategic goals.
Operational budgets are usually consumed by projects, so those projects start to have goal-like “symptoms.” Because of this fluidity of terminology, it’s important to regularly evaluate operational goals and projects to ensure they are on track and aligned with the organization’s strategy. This helps you be continually aware of how the progress you’re achieving is helping the company, all the way up to the strategic level.
Your strategy won’t be effective if you don’t have those operational goals in place and on track. Operational tactics and strategic vision have a reciprocal relationship. Plus, if you’re in a cost-cutting environment, it will be easier to defend your budget or work plan if it links closely to the strategy. You’ll be able to clearly show that you’re thinking strategically and using resources in a way that supports the strategy.
- These goals are focused on the monetary aspects of the business such as reducing costs or improving revenues.
- These goals tend to focus on improving productivity or quality so as to differentiate the company from its competitors.
- Cultural/Workforce. These goals are designed to improve the workforce’s capabilities, commitment, and discretionary effort.
Strategic Goals
Strategic goals let executives and upper management determine where they want to go. Basically, you want to get from your current state to a future enhanced position. Strategic goals are the outcome that you desire.
Perhaps you want to produce more products. You might want to reduce overhead. Maybe you want to enter new markets. Setting strategic goals allows you to evaluate where you are and challenge yourself to end up at a better place.
Some examples of strategic goals include:
- Increase customer conversion rates
- Launch a new product
- Increase revenues
- Improve training programs
- Diversify your revenue streams
Tactical Goals
Once you set strategic goals, you can build up your tactical goals. These further define your strategic objectives. You can plan tactical goals in advance by breaking down your strategic goals.
For example, let’s say that your strategic goal is to boost sales by 15 percent by the end of the quarter. Tactical goals would be the campaigns that you set up in each department to increase sales. One strategic goal should have multiple short-term tactical goals that create the momentum to achieve the overarching objectives.
Tactical goals can build on one another. You may have to accomplish certain tactical goals before you can take on more to produce a consequence. On the other hand, tactical goals can also be independent of one another. You can have several separate tactical goals that you can work on at once to bring about a result. Think of them as the action steps that provide a direct line to your strategic goals.
Performance goals
Performance goals are short-term objectives that an employee is expected to achieve within a set period of time. These goals are usually attached to specific job positions and are determined after considering the tasks and duties an employee is required to perform in that position. Performance goals are often a subset of and add up to overall company goals. They let employees know what is expected from their position, so it is important to define performance goals as clearly as possible and make them easily measurable.
Performance goals are what employees work to achieve. They are based on the goals and priorities of an organization and are tied to specific job positions. They focus on the job duties and productivity of an employee, and are designed to integrate an employee’s achievement with the overall goals of the company.
Development goals
Development goals, on the other hand, are set for the professional development of an employee. They focus on the areas the employee wants to develop for growth and advancement in their career. They encourage enhancement in performance through learning and development. Development goals are chosen and set by the employee, but they often involve active support from management. The employee usually looks up to the organization to help fulfill their professional development goals, such as through skill-based training and financial sponsorship.
How to set performance goals
Setting performance goals for employees is an important responsibility of a manager. Use the following steps to set measurable goals to improve the performance of your team and drive growth in your organization:
Invite employees to participate
Encourage employees to identify and suggest their own job-specific goals. Employees will be more motivated to achieve the goals that they set rather than those imposed by the management. Discuss with each employee their individual goals for a given performance period. Ensure that the goals align with the company objectives. Once you finalize the goals, develop an action plan for their achievement.
Review company objectives
Consider your company’s goals to connect performance goals for each employee with the mission and strategy of the company. Performance goals become effective when employees know how they contribute to the company’s growth. Start with an overall company goal and divide it into smaller goals for each employee. For example, if the management wants to grow sales by 4%, find out how each individual can contribute toward that achievement.
Use the SMART method
You can use the SMART method of setting goals to ensure that employee performance goals are specific, measurable, achievable, relevant and time-bound. Each goal should clearly tell the employees what they are expected to achieve and within what time frame. Quantify the achievement to make it measurable, and try to keep the target challenging but within the attainable range.
Specific
You should clearly define goals in specific terms as to what is to be achieved. For example, saying “start publishing a monthly newsletter” is better than making a generic statement like “improve communication with team members.”
Measurable
Goals should be measurable, making it easy to track their achievement. For example, “reduce process time by 10%.” In addition to a numeric quantity, you can also measure goals through a change in behavior, quality, cycle or processing time and efficiency.
Achievable
Goals should be achievable with a reasonable amount of effort. You should set realistic goals that can be achieved within the pre-determined timeframe with sincere efforts and available resources.
Relevant
All goals should be pertinent to the main objective, such as achieving company goals.
Time-bound
You should clearly specify a timeframe to achieve goals. For example, if you want to increase productivity by 10%, you should also state whether it should be achieved in one year, two years or by a certain date.
