Goals can lead to unintended behaviors if you don't understand how compensation and incentives relate to the way your team members will work. Troubleshooting goals requires you to look at the irrational behaviors that can arise from the goals you set. When you find those situations, you'll need to either revise the goal or revise the incentives.
- Goal setting processes can sometimes lead to…unintended behaviors or undesired behaviors.…If you don't understand how compensation and incentives…relate to how your team members work,…they may do the wrong thing.…Troubleshooting your goals requires you…to look at the irrational behaviors that can arise…from the goals you set.…When you find those situations,…you'll need to either revise the goal…or change the incentives.…I worked at a credit card company at one point…and I ran part of the collections division.…
We were trying to get delinquent customers…to pay us money back…and get their accounts back to current status.…If they didn't pay us back,…they were charged off as bad debt…and we lost that money.…We looked at our call center and we said,…"How do we want to change their behavior?…"How do we get more of our money back?"…We changed their goals and their incentives…to move from being focused on curing accounts…to just dollars collected.…We thought if we collect more money, we'll perform better.…What this led to was a behavior we didn't expect.…
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- Set corporate and business unit goals.
- Define driver metrics.
- Explain the concept of supporting goals.
- Identify benefits of tying goals to strategy and incentives.
- List ways to troubleshoot and communicate goals.
- Describe how to hold others accountable and avoid pitfalls.