Performance Management

How to set effective objectives (and retain talented employees...)

OpenBlend shares best practices for setting effective employee performance objectives. Review and set them regularly. Set clear timeframes and make them measurable.

How to set effective objectives (and retain talented employees...)

“Should I stay, or should I go?”

Making effective performance objectives part of 1:1 conversations can be a significant deciding factor for employees when faced with job opportunities elsewhere. Are they part of your performance management framework – or are poor goals and performance objectives contributing to employee turnover? 

People (6.5 million in 2023) plan on quitting their jobs, driven by a desire for a better work/life balance, less stress, more career progression and greater wellbeing. In short, people are looking for work that makes them happy.    

Yet as we’ve already established, what makes an employee ‘happy’ differs from person to person. The importance of having the right conversations, that recognise every employee as an individual, is inarguable. In today’s climate, you cannot build a sustainable business model without taking a people-centric approach. 

But conversation alone is not enough. For 1:1 meetings to be effective, and succeed in retaining the right employees, they need more than just talk. They need action. They need objectives. 

In this article, we’re going to talk about how employees and managers can work together to set effective objectives: goalposts that drive progression for both your employee and your business. But first, let’s take a moment to illustrate why employee performance objectives are so important. 

Why are objectives important?  

People and performance management are redundant without effective performance objectives. When employees and managers collaborate on the goal-setting process it helps to improve employee retention, engagement, and performance. Not only that, but it encourages employees to take charge of their workload and output, personal development and their growth.   

Take Sam, for example. Sam is a digital marketing executive working for an eCommerce brand. They have 1:1 conversations with their manager, but they don’t set clear objectives: especially when it comes to Sam’s career progression. But Sam is ambitious and is starting to feel like they’re standing still in their current role. When a competitor approaches with a job offer, it feels like a step forward: regardless of whether they are guaranteed career progression with the new company or not. 

With an effective objective setting process, Sam’s story ends very differently… 

Sam’s 1:1s with their manager incorporate clear objectives, broken down into achievable milestones. Sam knows exactly what they are working towards, both in terms of personal development and career progression across all areas of their role. They can see where their next career stepping-stone is, and what they are moving towards. When another organisation comes knocking, they are less likely to take the offer: they already have a visible, achievable development trajectory. 

Best practices for setting effective objectives 

What do effective objectives, like scenario two, look like in practice? And how exactly do you ensure that the process of setting them drives action, outcomes and accountability, improves performance and helps your company retain its employees? 

Setting objectives that inspire employees to perform at their best and produce great results is no easy task, and it is just as important to make sure that employee objectives are not only measurable and achievable but align with key business objectives and the bigger picture of what an organisation is trying to achieve.  

OpenBlend has compiled several best practices for both managers and employees to follow. Here we explain the key steps to follow when approaching objectives that can help your employees to succeed in setting and reaching their performance goals.

Review and set them regularly   

An occasional, sporadic objective is not useful. It’s even less useful if objectives form part of the annual review process. This type of objective setting is difficult to measure, difficult to maintain and difficult to achieve.  

Without regularity and continual review, it’s easy for objectives to drop off the radar. And while there is nothing wrong with long-term objectives, it’s more conducive to performance to review current objectives and set fresh ones regularly. This not only ensures that employees are working towards relevant objectives, but that their efforts are aligned with the business.  

By committing to the process of setting keeping the objective process regular via weekly or bi-weekly 1:1 conversations, your objectives become part of a framework, that creates a pattern of recognising their efforts, sharing continual feedback and reminding them of their purpose.  

Set clear timeframes 

A key part of SMART objective setting (the most well-known of all the different objectives frameworks, and the cornerstone of objectives on the OpenBlend platform) is setting clear timeframes. An objective without a timeframe is easily pushed to the bottom of the pile: one that’s timebound is easier to prioritise. Set a deadline for every objective, without fail. 

SMART Objectives Template CTA

Make them measurable with achievable actions 

For objectives to work, they need to be achievable, they need to be measurable, and that means setting clear actions. Vague objectives that feel too big, never-ending and/or immeasurable at the start can feel insurmountable, but broken down into smaller tasks and measured regularly, they become more attainable. This leads us nicely to our next point.  

Mark the journey with milestones 

When regularly reviewing, measuring and setting objectives, they must be broken down into smaller-scale achievements that mark the process and signal that the employee is on the right track to achieving their objectives. We call these milestones. And when it comes to employee retention, milestones are just as important as objectives in keeping your employees engaged with their work and maintaining their performance.   

Why? Because setting lots of disparate, large-scale objectives rarely works: it creates confusion and it’s overwhelming. Make sure that the objectives you and your employees set remain focused. When you set one, big objective that’s broken into achievable milestones, it’s always going to be more successful than a disconnected scatter-gun approach. 

Whether it’s career progression (like Sam’s example above), personal development or a delivery-based objective, milestones help move objectives along. They foster a sense of achievement, enabling employees to have the satisfaction of reaching every milestone on their journey. This dynamic approach to progression is one of the key points that will stop employees like Sam from having their head turned by competitors. 

Think about the type of objective you’re setting 

Objectives shouldn’t just relate to delivery, like completing a project, or increasing sales. Personal development is just as important, and truly effective employee objectives should cover broader ground. To set effective objectives, they need to be holistic. You need to be able to consider what motivates your employees, how they feel about the objectives that they are working towards and how the achievement of those objectives sets them on the path that they want to take with their career progression. 

This holistic approach ensures that employees feel like they are constantly moving forward and creating positive change. If you can nail down both commercial and personal objectives for every employee, it can have a huge impact on your organisation.   

But how can you make sure that objectives are holistic and employees are motivated to achieve them? 

Make them co-created and the process more collaborative 

Employees and managers both need to be able to set objectives to reflect personal and commercial needs. Employees may not always recognise what they need to work on from a commercial perspective, while managers shouldn’t have to guess what their employees want or need to achieve with their objectives. The best approach to objectives is one that allows for continuous collaboration. 

Co-creation of objectives is a strategy that brings together managers and employees to jointly produce objectives that tie personal goals to broader organisational goals so that everyone is working towards a shared purpose and has clarity in what they are working to achieve. 

Lastly, don’t forget to...  

Communicate purpose 

As above. Every objective should have a clear purpose, as opposed to simply setting an arbitrary outcome. On the delivery side, for instance, ‘raise marketing conversions’ could become ‘raise marketing conversions to reach Q1 financial targets’. By creating visibility around the bigger company picture, employees can get a better understanding of their objectives’ relevancy and importance within the business.   

Gartner research shows when employee goals are aligned with organisational priorities employee performance increases by up to 22%. So it goes without saying, the more that the purpose of employee and business goals are aligned, the better the commercial and personal outcomes. 

Use per­for­mance man­age­ment soft­ware to set, track and manage objectives 

Effective objectives shouldn’t be driven solely by an individual manager or anemployee: they should be supported by an organisational framework that makes sure every employee can identify – and work towards – the goals that matter to them. SMART objectives are integrated into the OpenBlend platform, supporting managers to set effective objectives that enable higher employee retention and improved performance across the board.  

To learn more about the steps to setting SMART, effective employee performance goals, and how OpenBlend’s performance management tool can help, contact our team to book a demo. 

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