As it appeared in the Daily Nation on February 20th, 2018
Many businesses have set very clear revenue and or production targets. These targets are tracked and reported daily. In addition, most sales persons have targets. Every week they submit a report on the status of their sales pipeline. Most call centres also have set clear metrics that are tracked daily. Many other departments such as operations and credit control also set targets. However, most businesses struggle with what to measure and as a result, most have no well-defined targets. Have you set targets for your team?

Performance targets are a very powerful management tool used to measure and reward performance. Performance is often measured at the corporate, departmental, team and individual level. In most organizations, targets and key performance measures or indicators are one and the same thing. Some organizations have set very clear targets at all levels. Setting clear targets helps the staff to know what is expected of them and how their performance will be measured.

The first step in setting targets is deciding what to measure and how to measure it. In a number of organizations that I have interacted with, the balance core card first developed by Kaplan and Norton in the 1980s is commonly used as a guide in setting company-wide targets. As a result, every person in the organizations has a target relating to the four perspectives of the balance core card. The four perspectives are the financial perspective, the customer perspective, the internal process perspective and the learning and growth perspective. In other organizations, strategic priorities determine aspects that matter most to the organization and this is what is to be measured.

For example, if an organization might decide that customer experience is a major strategic priority. Once such a decision is reached, the organization must set customer experience targets and develop a way of measuring the targets. In such a case, an organization may measure customer satisfaction levels, customer loyalty levels, number or revenues of return customers, number of customer complaints received, time take to make a delivery, number of calls not answered, percentage of calls answered within 10 seconds etc. The choice of measure will depend on type of business and the nature of its operations. What is important in such a case is for every staff member to have clarity on how his or her customer experience performance will be measured.

When setting targets, it is also important to determine how high the targets will be. While it is important to set realist targets, targets need to be set high enough to motivate the team to put in extra effort. Aiming to reach a high target results to stretch. In addition, it is important to have in place a reward and recognition system for achievement of targets so that staff who meet their targets can stay upbeat and those that do not can be encouraged. In many organizations, setting targets is critical in the achievement of objectives. Without any targets to aim for, organizations, departments, teams, and individuals are unlikely to make any considerable progress towards their desired direction.

Lucy Kiruthu is a Management Consultant and Trainer connect via twitter @KiruthuLucy