You should set two types of goals - the "commit" and the stretch. The "commit" is absolute and if you miss it, you can get fired. The stretch is the "what's possible" goal. To build a commit, work from the bottom up. Be sure, as the leader, you reconcile all the "commits" and ensure they add up to your "commit" to the organization.
- When you set goals I'll encourage…you to set two kinds of goals.…First is a commit goal and the second is a stretch.…A commit goal is something you're…committing to to the organization.…If you miss it you can get fired.…There should be extreme consequences…for missing a commit goal.…To build your commit goal work from the bottom up.…Work directly with your team and have them…make commitments to you as far as what…they're going to deliver for their goals.…
You'll then need to reconcile the teams commits and make…sure they all add up to your commit to your organization.…At one point I had three different teams and we were…tasked with a major cost reduction project.…My boss came to me and asked me how much…cost reduction would I commit to removing from the system.…I went to my team and I asked them…how much cost they could take out.…And I asked them for their goals.…They gave me commit goals of 1.5 million,…two million and three million dollars for a total…of 6.5 million dollars that they would commit to.…
When I went to my boss I hedged on that number a little bit.…
Along with providing guidance on how to link individual employee goals to organizational strategy, Mike walks you through the different types of goals, including bottom-up, zero-based, commit, and stretch goals. He also helps you use goals to change behaviors, build new skills among employees, and make goals actionable by using incentives and tying them to specific activities. He concludes with a comprehensive plan for setting and implementing goals, and some tips on dealing with challenges such as conflicting goals.
- Identifying goals and goal types
- Setting SMART goals
- Linking goals to business strategy
- Building goals from the bottom up or top down
- Creating stretch goals
- Outlining activities and resources to help employees achieve goals
- Reviewing and revising goals
- Reconciling conflicting goals