Setting objectives.Introduction This checklist is designed for those managers who participate in setting corporate objectives and who then have to interpret and apply such objectives to their own functional or departmental operation, including setting objectives with and for the people under their responsibility. Setting corporate objectives means clarifying the strategic and policy requirements of the organisation and setting and agreeing complementary operational objectives in relation to them. It is an integrated process which links corporate planning to business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets . As objectives are "rolled down" the organisation, they are usually made more specific. Every department, every team and every individual can and should have objectives. For objectives to be successfully achieved, it is necessary to identify an area of responsibility, such as improving performance or service, and to prioritise Verb 1. prioritise - assign a priority to; "we have too many things to do and must prioritize" prioritize grade, rate, rank, place, range, order - assign a rank or rating to; "how would you rank these students?"; "The restaurant is rated highly in the food them by those which "must" be done and those which "we would like to have done". Write objective statements which are SMART--Specific, Measurable, Action-oriented, Realistic, Time (and resource) constrained con·strain tr.v. con·strained, con·strain·ing, con·strains 1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force. 2. . They should be subjected to a process of discussion, compromise and agreement between those setting the objective and those who are to tackle it. Once agreed with the performer they should be written down for purposes of clarification and referral. Agreement with the performer, which is not always possible, but which is desirable, produces ownership which leads to commitment and therefore, objectives being met successfully. Integrated objective-setting helps build a better understanding of corporate planning at operational level, and accountability throughout the organisation, provides a clear sense of direction, and improves communication and motivation. If you manage without objectives, you risk not knowing whether what you are doing is in tune with longer-term plans or higher-level objectives and can create confusion and demoralisation Noun 1. demoralisation - a state of disorder and confusion; "his inconsistency resulted in the demoralization of his staff" demoralization confusion - disorder resulting from a failure to behave predictably; "the army retreated in confusion" 2. . National Occupational Standards for Management and Leadership This checklist has relevance to the following standards: B: Providing direction, units 1, 3 Definition An objective is an end towards which effort is directed and on which resources are focused. An objective should be specific (so that it is clear to those who are to work towards it), measurable (so that people will know when they have got there or not), and usually tackled within certain time and cost constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. . The differences between aims, objectives, goals and targets has been extensively debated. There are no real differences except those of scale and time; some may be long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. and high-level, others short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. and low-level low-lev·el adj. 1. Relating to or being of low rank or importance: a low-level job. 2. Situated in or occurring at a low level: low-level radiation. 3. . The key is to use the terms that you--and the people you are dealing with--understand. Throughout this checklist we use the term objective. Action checklist 1. Develop and communicate the organisation's mission/vision statements People often confuse con·fuse v. con·fused, con·fus·ing, con·fus·es v.tr. 1. a. To cause to be unable to think with clarity or act with intelligence or understanding; throw off. b. a mission with a vision statement. It is quite possible--even desirable--to have objectives relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc both. The mission statement lays down the purpose for which the organisation exists and provides the umbrella statement for the organisation's "standing" objectives. The vision statement is the expression of an ultimate aim to which the organisation aspires and encapsulates the "change" objectives. For example: * Our purpose is to make top quality cars. (Mission) * Our aim is to become the largest-selling car manufacturer in the world by the year 2000. (Vision) Such statements should be clearly communicated to and reinforced with all personnel, not just senior management. (See Related Checklists for Producing a Corporate Mission). 2. Identify corporate objectives from the mission/vision statement It is important to link corporate objectives to mission and vision statements. This is usually the purpose of the strategic plan and the function of senior management, although this process is being increasingly cascaded throughout the organisation in empowered organisations. The strategic plan is formulated for·mu·late tr.v. for·mu·lat·ed, for·mu·lat·ing, for·mu·lates 1. a. To state as or reduce to a formula. b. To express in systematic terms or concepts. c. by an assessment of: * what the organisation intends to accomplish and where it intends to be in terms of its market position compared with the competition * being in the right markets at the right time with the right product(s) and service(s) * ensuring a sustainable and profitable growth. Much will depend on the values of the organisation; values may well be challenged and re-assessed when setting high-level objectives, and vice versa--the adoption of new objectives may well lead to a reappraisal of values. The organisation's values will influence how it tackles its objectives in terms of the importance it attaches to the environment, the welfare of its staff and job security, and its public image in general. For many organisations however, objective-setting still remains a largely topdown exercise. In such cases, objectives should be set out in a plan and communicated to all staff (See Related Checklists for Strategic Planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. ). 3. Agree the objectives for senior managers This is a process of splitting the corporate objectives by function, business unit, or by product or service. It will be necessary to rank the objectives in terms of priority, draw up time-frames for achieving them and identify the resources required to tackle them: this precedes the operational and financial (budgeting) planning of that function or business unit. 4. Cascade A connected series of devices or images. It often implies that the second and subsequent device takes over after the previous one is used up. For example, cascading tapes in a dual-tape backup system means the second tape is written after the first one is full. to departments and individuals Again, some organisations make this a two-way process so that communication on key decisions is bottom-up bot·tom-up adj. Progressing from small or subordinate units to a larger or more important unit, as in an organization. Adj. 1. as well as top-down. Don't don't 1. Contraction of do not. 2. Nonstandard Contraction of does not. n. A statement of what should not be done: a list of the dos and don'ts. wait forever for top-down objectives; establish your own at departmental level which reflect the organisation's mission, and are in harmony with what your customers need and what your resources are geared to deliver. 5. Agree objectives with those who are to tackle them Setting objectives should not happen by dictat or decree decree, in law, decision of a suit in a court of equity. It is the counterpart in equity of the judgment in a court of law, although in those jurisdictions where law and equity have merged, judgment is sometimes used to include both. ; rather it should be by proposing and seeking ideas, by discussion, negotiation, compromise and agreement. That is an ideal situation; the minimum that both objective-setter and objective-performer should require from a one-to-one meeting is an answer to each of Kipling's six honest serving-men: who, what, where, when, why and how? 6. Identify appropriate performance measures Performance measures should allow progress against objectives to be measured. Performance measures (which can be employed on a team or individual basis) should indicate what is expected and how well people are doing towards their objectives. Performance measures should be clear, concise, easy to collect and interpret, and relevant in that they should provide information which tells you and your organisation how well you are performing. Measures are usually related to: * efficiency (how quickly you deliver) * effectiveness (how good/accurate/relevant was the service delivery for the customer) * cost-efficiency * cost-effectiveness cost-effectiveness pertaining to cost-effective. cost-effectiveness analysis a comparison of the relative cost-efficiencies of two or more ways of performing a task or achieving an objective. . They would usually cover information relating to: * finance--costs as well as income * customers--past, present and new * markets--penetration thereof * resources--consumed, saved or required anew a·new adv. 1. Once more; again. 2. In a new and different way, form, or manner. [Middle English : a, of (from Old English of; see of) + new * processes--how efficiently and effectively, tasks and activities are accomplished. Performance measures should also be agreed between job holder and manager and should be reviewed regularly (especially if there are significant changes to the work content). They are of benefit to the organisation or the individual in terms of personal development. Managers may well need time to help staff understand and interpret objectives for their department or their part of the organisation, even to help them work out their own contribution to corporate objectives (See Related Checklists for Establishing a Performance Measurement System). 7. Set up procedures for reviewing performance This--with section 6 above--is the principal content of the performance appraisal Performance appraisal, also known as employee appraisal, is a method by which the performance of an employee is evaluated (generally in terms of quality, quantity, cost and time). . It is in the appraisal discussion that past performance is reviewed, learning opportunities are identified and new or revised objectives are set for the next period. Managers should avoid * leaving out those who are responsible for achieving the goal from the discussion and agreement process necessary to setting it * neglecting to re-start the cycle by reviewing and revising objectives * being unclear as to the direction the organisation is going in. Additional resources Books Business strategy: an introduction, 2nd ed, David Campbell David Campbell may refer to:
Oxford: Butterworth Heinemann, 2002 Performance management review, Paul Suff London: Industrial Relations industrial relations pl.n. Relations between the management of an industrial enterprise and its employees. industrial relations Noun, pl the relations between management and workers Services, 2001 (IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. Management Review no 20, January 2001) This is a selection of books available for loan to members from the Management Information Centre. More information at: www.managers.org.uk/mic Related checklists Establishing a Performance Measurement System (129) Performance Management (180) Producing a Corporate Mission (067) Strategic Planning (064) |
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