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[b]BLUF:[/b] How does one [u]not[/u] worry about “[u]A[/u]ttainable” goals when management evaluates performance based on attaining or not attaining goals?

First of all, I’m a High D/C. I often struggle with the High C part of myself against “analysis paralysis,” and I’m better now than I used to be. That said, working in information systems, I work with and for other High C types. When setting goals, especially based on the information in the podcast, I have concerns about how high to set the bar.

[b]Current Example:[/b] I was recently assigned a project that is part of a highly-visible enterprise-wide (not just IS) cost-saving initiative. Here are some quick facts on this project:
[list]- CIO hired a technical consultant (usually done every few years) to look at all operations for opportunities for improvement. One area identified was a potential for annual savings of $x million through re-bidding and possibly changing the model of one of our expiring support agreements.

- I have not seen any detail around the savings (still waiting on blessings from higher-up for access to sensitive information).

- Those on my project team who have seen some of the detail and are familiar with the environment and current support agreement think the savings estimates are too high.

- My boss is new to this role. He has seen some of the savings detail yet is not familiar with the specific support agreement; although, he is familiar with the general environment.

- We have been asked by the cost-saving initiative leaders to provide high-level savings estimates. My boss told me that the plan is to re-forecast budgets [u]now[/u] based on estimated savings. So, if we say we expect to save $x million/year starting 4Q08, my boss’s budget will be reduced accordingly.

- My boss has said specifically that he does not want to communicate any projected savings until we get some more specific pricing information through the bidding process. Our current agreement expires ~mid-year. The current supplier has seemed amenable to extension. We also have other significant relationships with this supplier.[/list:u]
[b]Current (non-“MT”) project objective:[/b] Reduce costs through re-bid/negotiation of a new service agreement and, as appropriate, change to an alternate service model for delivering [i]xyz[/i] service by August 31, 2008.
[b]Measurable change:[/b] Reduce annual costs by $y million through re-bid…

Our performance measurement is based on a competitive ranking. Because the success or failure in achieving our goals is often “easier” to compare than the value delivered to the company, a lot of emphasis is placed on [u]not[/u] failing to meet goals. While I clearly do not expect or want to change my boss’s opinion on publishing a savings target now, I do want to try and set good “MT” goals within my project team. [b]How can I set a [u]measurable[/u] goal without getting caught in the concerns about performance measurement?[/b]

Thanks,

CC

WillDuke's picture

I might not be the best to ask, as I don't have a boss. :) As the boss, however, I'd appreciate having the discussion you just initiated.

That being said, I'm not savvy to many of the big corp political issues like rating on goals. I rate on performance. So if you set a goal to save 5 mil, and only saved 4 mil, I'd buy you dinner and give you a raise. :)

rachaelip's picture

Performance management in my organization is also based on competitive ranking and past performance. We use the SMART acronym. At one point someone on the leadership team (not my manager, but someone who participates in the rankings) advised me never to set a goal if there is any chance I will fail to meet it.

In this specific situation maybe you could give yourself a flexible goal by providing a range in terms of number of millions of dollars? Or have the goal reevaluated midyear if it becomes unattainable?

akinsgre's picture

This reminds me of the story from Good To Great (or Built To Last).

A company provided goals to the external analysts so that the company got consistent favorable ratings on Wall Street. The "external" goals were very achievable.

Internally, they set bigger, more audacious goals.

I think the story referred to Ross Labs, but can't be sure.

Can you do the same thing for your team? Does it make sense to do so?

mjpete's picture

One way to set high goals while still achievable is to define both "attainable" goals and "stretch goals". Maybe the attainable goal is $2 mil savings, while the stretch goal is $4 mil saving. That way you can put down the $2 mil in the performance system, while still pushing your team towards the $4 mil savings goal. Maybe extra incentives could be set for meeting the higher goal.