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The fine line between good stretch targets and bad ones

Targets must be tied to larger organizational ambitions

For targets to be meaningful and effective in motivating employees, they must be tied to larger organizational ambitions.

Employees who don’t understand the roles they play in company success are more likely to become disengaged. No matter what level the employee is at, he should be able to articulate exactly how his efforts feed into the broader company strategy.

Since employees are ultimately responsible for reaching their goals, they need to have a strong voice in setting them. Ask your employee to draft goals that directly contribute to the organization’s mission. Once employees have suggested initial goals, discuss whether the targets are both realistic and challenging enough.

There is a fine line between good stretch targets

There is a fine line between good stretch targets, which can energize an organization, and bad ones, which can dampen morale. When stretch goals seem overwhelming and unattainable, they sap employees intrinsic motivation. The enormity of the problem causes people to freeze up, and the extrinsic motivator of money crowds out the intrinsic motivators of learning and growth.

Listen to executive Srikant Datar:

 

 

Top-performing organizations

Top-performing organizations understand that employee engagement is a force that drives performance outcomes. In the best organizations, engagement is more than a human resources initiative – it is a strategic foundation for the way they do business.

Engaged employees are more productive, more profitable, more customer-focused, safer, and more likely to withstand temptations to leave. The best-performing companies know that an employee engagement improvement strategy linked to the achievement of corporate goals will help them win in the marketplace.

By sharing numbers with employees you can increase employees’ sense of ownership. However, being open is not enough. You need to be sure your employees are trained to understand financial statements and have enough insight into their own jobs to know how to affect the numbers.

High performance and success are not dependent on one simple factor or as a result of one or two things. The entire context you operate in greatly impacts your results.

 

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About the author
Torben Rick Torben Rick

Experienced senior executive, both at a strategic and operational level, with strong track record in developing, driving and managing business improvement and development and change management. International experience from management positions in Denmark, Germany and Switzerland

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About the author
Torben Rick Torben Rick

Experienced senior executive, both at a strategic and operational level, with strong track record in developing, driving and managing business improvement and development and change management. International experience from management positions in Denmark, Germany and Switzerland

View full profile

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