I had a great question recently from a client, he wanted my view on how to set targets for his teams. For context, his business is currently growing – both in terms of welcoming new starters and promoting existing team members into roles with more responsibility. The question came up on reflection that there was currently no formal target or reporting structure in place for these individuals.
Understandably, he wanted to start building something more formal into his teams – so they (and he) understood what they were aiming for.
My advice was along these lines…
Don’t jump straight to financial targets
When leaders and founders talk about targets, they almost instantly land on defining something based around growth or profit ‘I want you to achieve £100,000 client spend in Q1’ ‘I want you to grow client spend by 20% by Q2’ – something that measures – pounds or per cent – if that person is doing his or her job.
But here’s the thing, targets aren’t about measuring if a person is doing their job, they are about letting them know what is important and what success looks like – based on your business aims. Nb: you cannot define targets without knowing what your overarching business aims are.
Something to remember:
Discussions around targets can often be seen by your team as a way of inferring they are not doing their job, or that you are monitoring them. It’s important you make targets achievable and can communicate positively about how they can make a difference to business aims.
Targets are about behaviours
What do you want your team member to focus on and what are you telling them is important to the business? Targets need to be attached to things that people can affect in their role specifically – but they aren’t always financial.
What kind of things could your target KPIs include?
- A focus on client retention
- Achieving a certain net promoter scorer
- On-time delivery
- On-budget delivery
Imagine you are consistently losing money on a certain client because of over-servicing. Your target to the team member responsible for that client could be to deliver work on-time and on-budget. This is a target they can directly affect the outcomes of through things like building better briefs, writing concise scopes of work, communicating with the client around time spent and the cost of work outside of scope or perhaps delegating more menial tasks to a less senior person on their team.
When you go into a meeting or conversation about targets, you should be clear on what it is you want that individual to focus on – and make sure it is something they themselves can affect – whilst also helping them to understand why it’s important to the wider business aims (of increased profit / turnover / growth).
Learning and development plans often become part of the target discussion. If someone on your team can’t deliver against their target or goal (and assuming you know they are capable) then what are you going to do to develop their skills to ensure they can achieve them?
Yes, sometimes targets can be set around financial outcomes, but they should always cascade down from the overarching business need.
- Set targets individuals can directly affect
- Always refer back to your business aims
- Put L&D in place for those who need it to achieve their targets
I hope this was useful when you’re considering how to set targets for your teams, I’d love to hear how you approach these kinds of discussions.
Andy.