KeyneTalk

SMART Goal-Setting Isn’t so Smart After All

 by Kelly Nelsen

A problem with the typical goal setting process

I don’t know about you, but I’ve missed plenty of the goals I’ve set for myself over the years.  I don’t live on a cliff overlooking the ocean, I don’t own a baby grand piano (although I do own an upright), and I didn’t get my doctoral degree by the time I was 40. I faithfully followed the SMART goal setting process for these things, too.  (You know, making your goal Specific, Measurable, Attainable, Realistic, and Time-Bound?) 

As part of the SMART goal setting process, we’ve been taught to set a target for a goal – a measurement that defines whether the goal has been met or not.  It may be an amount, a percentage, a date, or some other criteria.  “Complete Microsoft Excel training class by December 31^st, 2009”, or “Lose 20 pounds by Christmas”, or some such thing.  Did you ever wonder, though, how to account for losing only 19 pounds rather than 20 by Christmas?   After all, shouldn’t 19 pounds count for something?  Usually, what we end up doing is considering losing 19 pounds as having met the goal, when technically, the goal was missed.  We didnt' actually lose 20 pounds. As a result, our goal setting and scoring at the end winds up being rather sloppy and vague in order to account for “almost-met” goals.  This leads us to start believing that falling short on a goal is okay, and pretty soon, it screws up the whole goal setting and achievement process.  At issue here is how the measurement criteria are developed.

We’ve discovered a much better process in working with clients over the years.  Instead of simply indentifying how to judge the goal and selecting a target to hit, we help them develop clear missed, met, and exceeded criteria when setting goals.  By determining these three different measurement criteria up front, the need for interpretation and “almost met” goals at the end is completely eliminated.   Setting missed, met, and exceeded criteria involves 1) setting the missed criterion, 2) setting the exceeded criterion, and 3) identifying the range between the missed and exceeded criteria as the met criterion.

Let’s take a sample business-related goal and discuss how to create measurement criteria for it:  To increase total power drill sales to $3.1 million by FYE 12/31/09.

In order to figure out what it means to meet a goal, it’s easiest to first determine what it means to clearly miss the goal.  For example, we may clearly miss the power drill sales goal if we only hit $2.8 million by FYE rather than the $3.1 million we determined earlier.  However, we’ve also thought about it and determined that it’s probably acceptable to hit $2.9 million.  This makes our $3.1 million target a little fuzzy, doesn’t it?  So, we can set the missed criteria to indicate that the goal will be clearly missed if power drill sales are less than $2.9 million by FYE 2009 (missed equals < $2.9 million). 

The next step is to identify the exceeded criterion.  The principle question to ask in this phase is,” What is clearly worth double the kudos (whatever those may be – points, benefits, bonus money, etc.) if a person exceeds this goal?”  If you think of the exceeded criterion as being a target that, if hit, is worth double the value of merely meeting the goal, you have the right idea.  In our power drill example, maybe $3.2 million isn’t worth double the points, but $3.5 million is, given the stretch that might take to get there.  If this is the case, the exceeded measurement criterion becomes anything equal to or greater than $3.5 million in power drill sales. 

So far, we have the missed criterion set at anything less than $2.9 million and exceeded set at anything equal to or greater than $3.5 million.  So what becomes the met criterion, then?  It’s not really $3.1 million, is it?  The met criterion becomes a range rather than a number.   In this example, the met range is $2.9 – $3.49 million. 

Although it may seem counterintuitive to think of a goal target as a range than a number, it makes sense when you consider the reality of goal accomplishment.  Setting an arbitrary target point is essentially the same as trying to shoot a gun at a target at a shooting range.  With luck (and a lot of skill), we might hit it dead-on, but in all likelihood, we’ll miss it to one side or the other.  As with target practice, by using the missed/met/exceeded criteria, we are allowing ourselves a range of hits, a clear range of misses, and an opportunity to be rewarded for stellar performance.

To learn more about our philosophies surrounding goal setting and employee performance, click here.

5 Ways to Keep Your Staff's Morale Up

by Kelly Nelsen

In this economy, employee morale is likely to be in the pits.  Employees are being laid off, companies are closing, and pay and benefits are getting reduced.  In an up economy, employers tend to throw money, perks, and benefits at any morale problem, but in this day and age, that is usually not possible.  So what other means can an employer use to increase employee morale?  Well, it all starts with knowing what really motivates employees.

In a survey asking both managers and employees what motivates employees, the two groups came up with very different answers.  Managers assumed that the number one motivator for employees was pay.  Surprisingly, they were wrong – employees ranked it 5^th out of ten.  Managers thought job security was the second highest motivator for employees, but employees ranked it 4^th. 

So what did employees think was more motivating than either pay or job security?  Here’s the list, in order:

1.    Interesting work. 

Employees are motivated the most by interesting work.  Managers ranked this 5^th.  In other words, managers believe that employees don’t care so much about interesting work.  Instead, they think employees would much rather have good pay and job security.  Put yourself in an employee’s shoes, though.  Would you rather put a thing-a-muh-banger on a widget  for 8 hours per day, 5 days per week but get paid relatively well for it, or would you rather do something that you like to do because it interests you?  Frankly, I’d be more motivated to wake up in the morning for the latter choice.

2.   Full appreciation of work done. 

Second on employees’ list of motivators is full appreciation of work done.  Incredibly, managers ranked this 8^th.  Eighth.  There’s a major disconnect going on here.  Employees say they’re motivated by positive feedback (which is what this one is all about), yet managers seem to be oblivious to it.  Perhaps it’s due to the “no news is good news” mode that many managers slip into because of the hectic, fire-fighting nature of their positions.  If you put yourself in an employee’s shoes once again, wouldn’t you like to know that you’re doing a good job and that your efforts are appreciated?

3.   Feeling of being in on things.

Have you ever been left out of a secret?  Back in junior high school, maybe, and everyone knew the secret but you?  What did you do?  You probably did what most other kids do and demanded, “Tell me!  What are you guys talking about?  Come on, pleeeeeze tell me?!  I won’t tell anyone!”  And when they finally let you in on the secret, you felt privileged that you were one of the ones who knew.  You were now in the inner circle.  Well, it’s the same thing at work – even as adults, we all want to be a part of the inner circle.  Employees want to know what’s going on.  They want to be trusted and respected enough to be let in on things.  But managers ranked this 10^th – dead last.  Interestingly, managers want to be “in on things”, so why would they think their subordinates would be any different?

Job security ranked fourth as a motivator according to employees, good pay fifth, and rounding out the top ten were promotion and growth, good working conditions, personal loyalty to employees (by the manager), help with personal problems, and tactful discipline.

Great.  Now that we know what motivates employees, how can companies use this information to improve morale?  Here are a few tips:

1.    Get to know your employees. 

Find out what they like and dislike about their jobs and what they’re interested in doing more of.  Keep in mind that there are very few jobs in which everything about it is interesting.  Every job involves a few boring, tedious, or otherwise unlikeable duties, but that doesn’t mean those less-liked things should be dumped off onto someone else.  But you can allow employees a bit of latitude in deciding how they do their jobs (when possible) or encourage them to get involved in projects that they have an interest in or a special talent for.  When employees actually want to get up in the morning to go to work, it improves their outlook, which in turn improves morale.

2.   Get rid of the “no news is good news” attitude towards employee feedback. 

It’s a cop-out.  Too many managers consider the supervising of employees to be just another annoyance that takes time away from other, “more important” things.  However, all managers who have employees reporting to them have a duty to let employees know how they’re doing on an ongoing basis – both good and bad, preferably on a weekly basis.  Did you know that it takes five instances of positive feedback to outweigh one instance of negative feedback?  Letting employees know how much you appreciate the job they’re doing is one way of giving positive feedback and one way of improving morale.

3.   Make employees feel like they’re a part of something special. 

I’m not talking about spilling sensitive company information or confidential human resources issues.  I’m talking about creating a sense of belongingness and eliteness that everyone associated with the organization can feel. 

 It starts with creating a vision that speaks to everyone in the organization, not just the shareholders.  For example, “By 2014, we will double our current revenue” only speaks to the shareholders, but “By 2014, we will be recognized as the most respected provider of ambulatory care services in the southwestern United States” is something that everyone can picture and feel proud to be a part of. 

It doesn’t stop there, though.  When each employee knows how s/he specifically contributes to that meaningful vision, it gives more meaning and purpose to daily activities.  Employees learn that they are important and that they do matter.  Note, here, that I am not talking about how much their jobs matter.  Employees need to know that they matter – not some job that anyone can do.  See the difference?

4.    Empower employees. 

Frankly, while I hate the term “empowerment” because it’s been so over-used, empowering employees allows them to be more autonomous and shows them that you trust and respect them.  When you empower employees, you treat them like intelligent adults who are capable of doing many incredible things on their own.  And they are.  If you let them, they will come up with many great ideas for improving efficiency, customer service, quality, products – you name it. Not only will it help improve morale, but it may also improve your organization’s bottom line.

5.   Improve their working conditions. 

There are a lot of ways to do this, from giving flex time to allowing them to work virtually for a day a week to sticking some plants in the office.   One fun thing a client of mine did was to hold a vine-growing contest in the office.  Employees started with seeds and planted them in little pots in their cubicles, and over the following months, the vines snaked all around the office, draping over push-pins and printers and at times intertwining with others’ vines.  The person with the longest vine won a prize everyone had chipped in for, and the contest served to break up the tedium of the day-to-day work. 

While the aforementioned survey was conducted before the current recession (and as a result, “job security” may rank higher than 4^th right now), the results are still very relevant.  The fact that managers are so out of touch with what employees find motivational is both concerning and encouraging.  It’s concerning to know that managers are focusing on the wrong things in order to motivate their employees.  It’s encouraging, though, to know that if managers can address the right things, morale during these tough times can be improved significantly without needing to throw money at the problem. 

In the 1500s - Just for fun

by Wayne Nelsen

I was sitting at my desk getting frustrated that a web page was taking too long to load when I received this in an email.  I realize it's probably been around the internet for awhile, but I hadn't seen it before, and since it got me thinking and brought on a much needed smile, I thought I'd share it with you. 

So, just for fun: 

In The 1500's
 
 The next time you are washing your hands and complain because the water temperature isn't just how you like it, think about how things used to be. Here are some facts about the 1500s:
 
 Most people got married in June because they took their yearly bath in May and still smelled pretty good by June. However, they were starting to smell, so brides carried a bouquet of flowers to hide the body odor. Hence the custom today of carrying a bouquet when getting married.
 
 Baths consisted of a big tub filled with hot water. The man of the house had the privilege of the nice clean water, then all the other sons and men, then the women and finally the children. Last of all the babies. By then the water was so dirty you could actually lose someone in it. Hence the saying, Don't throw the baby out with the Bath water...
 
 Houses had thatched roofs-thick straw-piled high, with no wood underneath. It was the only place for animals to get warm, so all the cats and other small animals (mice, bugs) lived in the roof when it rained it became slippery and sometimes the animals would slip and fall off the roof. Hence the saying It's raining cats and dogs.
 
 There was nothing to stop things from falling into the house.. This posed a real problem in the bedroom where bugs and other droppings could mess up your nice clean bed. Hence, a bed with big posts and a sheet hung over the top afforded some protection. That's how canopy beds came into existence.
 
 The floor was dirt. Only the wealthy had something other than dirt. Hence the saying, Dirt poor. The wealthy had slate floors that would get slippery in the winter when wet, so they spread thresh (straw) on floor to help keep their footing. As the winter wore on, they added more thresh until, when you opened the door, it would all start slipping outside. A piece of wood was placed in the entrance way. Hence the saying a thresh hold.
 
 (Getting quite an education, aren't you?)
 
 In those old days, they cooked in the kitchen with a big kettle that always hung over the fire. Every day they lit the fire and added things to the pot. They ate mostly vegetables and did not get much meat. They would eat the stew for dinner, leaving leftovers in the pot to get cold overnight and then start over the next day. Sometimes stew had food in it that had been there for quite a while. Hence the rhyme, Peas porridge hot, peas porridge cold, peas porridge in the pot nine days old..
 
  Sometimes they could obtain pork, which made them feel quite special. When visitors came over, they would hang up their bacon to show off. It was a sign of wealth that a man could, bring home the bacon. They would cut off a little to share with guests and would all sit around and chew the fat..
 
 Those with money had plates made of pewter. Food with high acid content caused some of ! the lead to leach onto the food, causing lead poisoning death. This happened most often with tomatoes, so for the next 400 years or so, tomatoes were considered poisonous.
 
 Bread was divided according to status. Workers got the burnt bottom of the loaf, the family got the middle, and guests got the top, or the upper crust.
 
 Lead cups were used to drink ale or whiskey. The combination would sometimes knock the imbibers out for a couple of days. Someone walking along the road would take them for dead and prepare them for burial. They were laid out on the kitchen table for a couple of days and the family would gather around and eat and drink and wait and see if they would wake up. Hence the custom of holding a wake.
 
 England is old and small and the local folks started running out of places to bury people. So they would dig up coffins and would take the bones to a bone-house, and reuse the grave. When reopening these coffins, 1 out of 25 coffins were found to have scratch marks on the inside and they realized they had been burying people alive. So they would tie a string on the wrist of the corpse, lead it through the coffin and up through the ground and tie it to a bell. Someone would have to sit out in the graveyard all night (the graveyard shift.) to listen for the bell; thus, someone could be saved by the bell or was considered a dead ringer.
 
 And that's the truth...Now, who ever said history was boring?!

I don't know who the author is, so if you know, please comment so I can give credit where credit is due.

Why We Don't Call KeyneLink a Performance Management System

by Kelly Nelsen

 

People ask us why we don’t call KeyneLink a performance management system.  Here’s our answer.

KeyneLink is a performance management system, but it’s unlike any other performance management system out there in the market today. Unfortunately, people have used the term “performance management” to refer to performance appraisal, and now the two have become synonymous.  True performance management requires managing the performance of organizations and the people within them on an ongoing basis.  It starts at the organizational level and extends all the way to the individual level.   A true performance management system tightly aligns the duties and goals of the people with the vision, mission, core values, and strategy of the organization.  For these reasons, true performance management is driven by top management, not by human resources. 

All of the so-called “performance management” systems out there today are really performance appraisal systems, and as such, they’re driven by human resources.  These systems have been dressed up just enough to appear as if they align with the organization’s vision and strategy, when in reality, they only give a passing nod to what the organization is trying to accomplish.  Instead, they retain the subjective, personality- and trait-based measures of the traditional performance appraisal.  They merely automate the performance appraisal process and provide some bells and whistles to make the process a little easier.  Sure, some of them incorporate goal-setting, but the goals tend to be of a personal improvement or succession planning nature and are based upon the results of the performance appraisal.  The goals in a true performance management system, on the other hand, are actionable goals that are directly based upon the organizational initiatives and step the organization closer to achieving its objectives for the year.

So, rather than to try to fight the tide and redefine performance management the way it ought to be defined, we’ve chosen to use a term that truly differentiates us from everyone else: strategy-driven execution management.  After all, KeyneLink is a system that does what a true performance management system should do: manage the execution of an organization’s strategy through its people.  Given that, the term “strategy-driven execution management system” defines KeyneLink pretty well, don’t you think?

The Easy Button Lie

by Kelly Nelsen

 

I truly wish that I could just press a button and, “Voila!” everything would be in order, the business would be taken care of, everyone would be perfectly motivated and productive, and I would be instantly transported to a warm, breezy beach where I was sipping an umbrella-garnished drink while listening to the seagulls calling overhead.  If I see one of those easy buttons, I can’t help myself – I’m inexorably drawn to pressing it in the hopes that this time, it will work.

But we all know that life just ain’t easy -- Adam and Eve had to mess it all up.  I hope they’re happy.  Because life is so doggone hard, we continually search for ways to make it easier.  If you think about it, nearly all of our inventions have something to do with that – cars, the printing press, remote controls, microwaves, computers, electricity, fast food, the wheel, shovels – I challenge you to think of an invention that wasn’t intended to make something easier.

Sometimes, though, we go a bit too far.  In the pursuit of making something easier, we actually make it harder.  Take computers, for example.  Yep, the words get put onto the paper much more quickly, but what happens when your computer crashes?  And what about all the stuff computers need to make them work?  Intricate internal workings that I can’t even begin to name, electricity, printers, internet access, a phone or DSL line…the list goes on.  Wasn’t a piece of paper and a pencil easier, for heaven’s sake?

The same can be said for many of the systems and processes in a company.  We try to press an easy button to manage our employees, thinking that if we can just fill out a form at the end of the year, that oughtta do it.  Feedback given, reward given (or not), and onto the next year we go.  We’ve even gone so far as to automate these forms with computerized programs that fill them out for you, complete with the option of making the language a little more positive or a little more negative with the click of an easy button.

Do you really think that human beings are that simple? 

We’re not machines – we’re high-maintenance pieces of uniquely individual art that continually evolve and change and look different than we did last year – if not on the outside, most certainly on the inside.  How can we hope against hope that a simple performance appraisal at the end of the year will do anything significant to change the direction of our people or our business?

No, life ain’t easy, and running an organization ain’t easy, either.  So stop buying into the lies that say that you can make the important stuff easy.  It never is, and it never will be.  Employees, just like your business, need ongoing maintenance.  And you at the top must lead this charge.  When you embrace this truth, you’ll be on your way to making your business successful. 

Or you can keep on pressing that easy button to see if it might just work one day.

For more information about managing and maintaining the performance of your organization and your employees, go to www.keyneinsight.com.

Conversations cause clarity. Clarity creates action. Actions produce results.

by Kelly Nelsen

I think we can all agree that results are what we need most in our organizations right now.  But how do you make sure you're getting not just any results, but the right results?  Results come from actions, and by initiating the right actions, the right results should follow.  But in order to initiate the right actions, you need to have a clear understanding of what is to be done.  And this clarity can only be caused by having the right conversations.

Having the right conversations is key to producing the right results.  Often, though, we take the well-traveled road of polite conversation because it's easier.  We think -- no, hope -- that the person on the other end of the conversation will read between the lines and hear what we really want them to hear rather than what we're actually saying. 

Steve Bryant, one of our long-standing clients, said it best when he quoted his late father, "The loudest voice in the room is the one you never hear."  The right conversations in an organization are sometimes the hardest ones, but they're the ones we need to be having if we really want to produce the right results.  And I think we can agree that the right results are what we need right now.

Breaking through the "Strexecution Point"

By Wayne Nelsen

Where organizations tend to falter is not in the planning process, but in managing the execution of the plan.  They fail to successfully break through what Kelly and I call the "strexecution point".  Over the next several posts I want to talk through how to ensure that your organization can break through and achieve your organizational initiatives.

So what is the strexecution point?  It's the point of transition between strategy and execution. It is at this point that many management teams seem to hit a wall and stop.  Once they have a plan, they fail to recognize the importance of dynamically managing the execution of that strategy.  Instead, they allow it to be eclipsed by the urgency of day-to-day activities.

It's no secret that many organizations are better at planning than execution.  Planning is easier than executing.  However, if I had to make a choice, I would rather run an organization that is great at execution even if it is weak in planning than an organization that is great at planning and weak in execution.  With great execution management, I can make adjustments quickly and make up for planning weaknesses.  However, no amount of planning can make up for poor execution.   

Make sure your team doesn't let up after the planning phase by putting the plan on the shelf while they go back to handling the urgency of day to day activities. You must follow through with strategy-driven execution management.  This is what will allow some organizations to thrive and take advantage of the current economic conditions to increase market share while others are focused on simply surviving.

The key to successful navigation through the strexecution point will be the subject of our next several posts.  

Who Owns Performance Management?

It's amazing to me that conventional wisdom says HR is the owner of the performance management process.  This comes from the misunderstood notion that performance appraisal is the same as performance management.  After all, isn't performance management about evaluating people, and isn't HR responsible for everything to do with people?  The purpose of performance management is to ensure we're in compliance and have documentation for compensation decisions, right?

No, not really.

True performance management is about operationalizing the strategic plan and/or the annual operating plan of the organization.  It's about managing individual and group efforts toward the accomplishment of organizational initiatives.  It's about clarity of direction, alignment of all goals down to an individual level and engagement of the employees in the goal setting process.  It's about ensuring the clarity of individual roles and responsibilities.

So who should own the performance management process?  Senior management.  Actually, the process is owned by senior management, but it is a core responsibility of every manager down to the first line supervisor.

Radical? Maybe.  Out of step? Possibly.  But if you think it through, I believe you'll see that it is the only way to ensure its success in your organization.

To learn more about performance management visit us at www.keyneinsight.com

Performance Management - What's the secret?

"If you had to narrow it down to one thing, what is the most important component in performance management?" 

This was one of the questions I was asked last week while giving a presentation on the difference between performance management and performance measurement.  The answer is actually fairly simple.  Performance management at its heart, is clarification of expectations and communication.  There is no more important component in the performance management process than communication.

Unfortunately, communication is not the central theme of most so called "performance management" programs.  Yes, in these other systems there are communication meetings, usually once, or even twice a year depending on how your HR group has structured the program.  But these are performance "review" meetings.  What I'm talking about are the on-going dynamic performance "management" discussions that lead to the successful achievement of organizational initiatives.  These must happen at least once a quarter and should happen bi-monthly or even more often.  Who ever heard of managing something by reviewing it once a year?

The tone of these progress meetings is also different than a "review" meeting.  There is an inquisitive, coaching, mentoring, and partnering tone to a progress meeting versus a judgmental, tense and even competitive tone that typifies a "review" meeting.

I am convinced that if you were to go into most any organization and you did nothing more than get every manager and employee to sit down every other month and talk about the employee's performance and how the two of them can improve their working relationship, that alone will improve performance.

Communication is one of the major differentiators between true performance management systems and performance measurement systems (i.e. performance appraisal).

I know you all knew that already, but sometimes the obvious seems to get lost in the structure of the process.

The annual dance

  It's that time of year again!  Yes, it is Thanksgiving and the start of the Christmas season, but it's also the start of the performance appraisal season.  Manager's everywhere are starting to get the dreaded forms from their HR departments.  They will soon be dusting off last year's performance appraisal forms to see how many goals from last year have been completely forgotten.  Many are even starting to develop that knot in their stomach about having to go through the arduous process again. 

     It is also the season for all the articles about how bad the performance appraisal process is or how to make it at least somewhat effective.  I have had at least twelve people email the link to the latest Wall Street Journal article: Performance Reviews Need Some Work, Don't Meet Potential.  Every year there are a series of articles published lamenting the fact that we seem to be stuck in this trap with no effective alternative.

  I have a novel idea.  How about we stop appraising performance and start managing it?!

The problem is that their are many programs out there that claim to be performance management programs but are really just the same old performance appraisal process dressed up to look better.  How can you tell the difference?  An effective performance management process has several characteristics:

1. The most important element of performance management is communication.  So the process should facilitate frequent progress meetings and feedback between manager's and employees.  If there are less than 4 progress meetings per year, then you have a measurement/appraisal process.
2. The emphasis should be on goals that are linked to initiatives and not on competencies linked to training and development.  Performance management is about leading and guiding groups and individuals toward the accomplishment of organizational initiatives.
3. Goals should be linked directly to corporate initiatives thereby creating direct line of sight from the strategic plan to the initiatives and down to the individual goals within the organization.
4. Employees should enter their own data; managers should never enter the data for employees.
5. Core Values should be infused throughout the process.

     Why not set a New Year's resolution to change from the antiquated performance measurement/appraisal systems to a true performance management system? 

     Yes, we can help you with that.

Happy Thanksgiving!