Target setting

Targets are needed to bring meaning to any performance measure

They enable one to quantify scope for improvement, performance gaps to be closed and urgency for change

Told your ‘bad’ cholesterol level is 8.6 and most would ask ‘so what?’ – told that good health requires the level to be below 5 and a course of statins is needed pronto

At work, all teams need to fully understand how they are being measured – and be provided with rapid feedback on actual performance levels whilst their efforts are still fresh in their memories

However, targets vary over time viz:

  • Budget targets = Short term – one year ahead:
    • Usually set by taking last year’s results and adding a small % to them so they’re not too difficult to meet
    • However, if and when they are met, most managers either don’t try to do any better (i.e. they put a brake on progress) or they don’t let it show in their results in order to get a flying start for the next year
    • In the public sector, it’s often worse – a culture of ‘use it or lose it’ is widespread – any manager who spends less than his budget in one year would expect to have it reduced in the next, so he makes sure he spends the lot
    • In addition, budgets, whatever the sector, can lock in considerable waste – if last year’s budget funded a 30% waste of resources, as many do, then adding say 5% to the total not only perpetuates current waste but adds to it
    • So always ask of any budget, ‘how wasteful?’ and ‘how stretching?’
  • Best practice (BP) targets = Medium term – two to three years ahead:
    • Internal BPs – they provide worthy targets, at least to start with – first identify best performances recently achieved by your own team, then other in-house teams working on similar work – then ask why your team does not achieve these BPs all the time – it’s much like an athlete constantly comparing his latest performances with his PB (Personal Best)
    • External BPs – by non-competitors who are leading lights in specific fields – some are happy to publicise their better ways of doing things, and the lessons learned from mistakes made
    • External BPs – by competitors – if there’s a significant performance gap between you and the best in your sector, your very existence is under threat so action is needed to close the gap – however, beware copying what others do for it may not suit your circumstances and abilities – it’s much like watching Rory McIlroy play golf but never being able to play like him – instead, it’s often better to study your own working methods and improve them in your own way
  • Goals = Long term – five years ahead:
    • Goals are aspirational targets i.e. dreams that just might become reality
    • Most global winners possessed ambitions out of all proportion to their resources and capabilities when they started out

Given these options, beware the following:

  • Many targets are set arbitrarily by back-room bureaucrats who lack a good understanding of what managers need to focus on in order to keep their customers happy and their units performing well:
    • The latest example is the decade-long campaign for normal (gold standard) rather than caesarean (systemic failure) births despite the danger and psychological damage done to mothers and their babies
    • Hospitals were assessed accordingly, even ‘congratulated for having done only natural deliveries over eight months’ according to The Times
  • Other targets are always raised every year:
    • A ‘puissance problem’ is the result
    • Managers keep ‘raising the bar’ regardless of how high it was last time so, eventually, it can become too difficult to meet
    • Teams then either give up trying and / or become demotivated, and so fail miserably, especially if there are no extra carrots on offer

Overall, target setting is thus not a quick, back-of-envelope exercise but one which must be carefully considered

For positive results, targets MUST be seen by those who have to reach them as realistic, stretching but fair – otherwise, only negative results will follow

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