We’ve made the decision to set quarterly priorities. What should I make sure to be aware of when setting goals for the fourth quarter and 2012?
By far the most important piece in setting priorities is recognizing the need for balance. Establishing one thing as your top priority is critical, yet you can achieve your one thing and do a great deal of damage to your business if you don’t balance this with a meaningful measure that protects you from achieving too much productivity at the risk of harming relationships or vice versa.
At the top of the One Page Strategic Plan are two headings for People (Relationship Drivers) and Process (Productivity Drivers). In our private and public events we don’t have enough time to delve into these to the degree that is suitable to help business identify metrics for reporting. Yet we do describe the importance of developing a balance between these two business drivers.
It’s important to balance Productivity Indicators (activities that you do or achieve), with People Indicators (activities that impact relationships). Companies that measure only one of these two areas tend to go out of balance. This can damage the company’s results (productivity) or relationships (people).
The visual we create on this is one side of a tug of war. Imagine that all your people are focused on one side of the equation, productivity or people. With no one on the other side resisting, what happens to those tugging on the rope? They fall down out of balance. Here are a couple of examples.
· General Motors: During the recession, the unions working with General Motors resisted concessions that would keep the company afloat. As a result, the company declared bankruptcy and was bailed out by the Federal Government. GM got too out of balance focusing on its People that it lost its Productivity health.
· Enron: Contrasting GM is Enron, an organization whose top management was so focused on results – Productivity – that its broke the law and damaged its People (shareholders, employees and customers).
It is vital for you to develop a healthy perspective for your growing company by consistently measuring both Productivity AND People indicators. Two other keys points to keep in mind:
1. In setting your priorities include both leading and lagging indicators (metrics). We recommend that you develop two leading indicators for each lagging indicator. Don’t forget that the two most valuable traits of leadership are the ability to delegate and predict. Leading indicators help you forecast the road ahead.
2. Reaching your objectives requires commitment to setting priorities and making sure that you have chosen the right priority to focus on. However when you commit full out to hitting your priority don’t forget to set metrics that will counter balance that effort to ensure your success doesn’t leave a lingering disappointment elsewhere in your business.
There are a number of other good answers to what you should consider when setting goals. This includes creating dashboards, setting precise goals, setting success criteria, making sure you communicate your goals to your team to get buy in, getting commitment from your people to their specific contribution to each objective, and making sure you are reviewing progress through daily, weekly, monthly meeting rhythms. You should also recognize that stretch goals are not always the answer to achievement.
Stretch goals can be effective, yet incremental progress is often much better. You’re looking for momentum. Momentum is something that you can build on. If you fail you may lose momentum and need to restart next quarter. You may even lose the faith and belief of your people in the priority setting process. Less is more. Start small and build on success
Make sure you get 2012 off to the right start by planning ahead now and making sure there is balance in your priorities and metrics.