Setting Effective Performance Goals for Managers: A Simple Guide
Performance goals for managers aren't just mere targets. They're the compass points directing leadership, decision-making, and growth.
Yet, many leaders grapple with creating effective goals that propel them and their teams forward.
You're not alone if you've found yourself setting vague goals like "improve team productivity" only to find it gathering dust. After all, what does it really mean? How do you measure "improve"? By 10%? 50%? And how exactly do you define "productivity" for your specific team?
It's time to turn those abstract ideas into actionable, achievable milestones.
- Guides you on how to set good performance goals for managers.
- Offers examples of different types of manager performance goals to get you started.
📈 What are managers' performance goals?
Managers' performance goals are specific objectives set for leaders to achieve within a given time frame, designed to enhance both their individual performance and the performance of their teams.
These are specific objectives that define a clear direction and focus for managers. They provide clarity on the quality and quantity of work results expected of them.
Manager's performance goals maximize their contribution to the organization's success by aligning their efforts with the organization's strategic direction.
Here are some common types of performance goals for managers.
They focus on more minor accomplishments—actions and strategies—leading to the achievement of larger performance objectives.
Process goals aim to improve the efficiency of processes. They optimize and streamline workflows within the department.
Example: Identify and automate repetitive tasks within the team's workflow to reduce errors by 20% and improve the team's productivity by 25%.
These focus on the long-term results that the manager should deliver. More often, the success of outcome goals results from successful process goals.
The results of outcome goals should be measurable and directly linked to the larger organizational goals.
Example: Increase online sales revenue by 15% in the next quarter through effective digital marketing campaigns.
Team development goals
These are goals that target the performance and effectiveness of the entire team.
Examples are enhanced collaboration, higher engagement among team members, continuous skills improvement, etc.
Example: Increase the team's communication skills and use of digital communication tools for project updates by 15% within the next 2 months.
The focus of leadership goals for managers is enhancing their competence in areas that directly influence their ability to drive better team performance.
This means setting objectives that improve their people management skills, such as coaching, giving regular feedback, and conflict resolution.
Example: Attend a coaching workshop and use effective coaching practices to improve employee engagement scores by 25% over the next quarter.
Take note that performance goals for managers differ from professional development goals.
The focus of performance goals is to help managers achieve specific and measurable outcomes. However, the focus of professional development goals for managers is enhancing their leadership skills.
🔬 Check out this detailed guide on performance goals vs. development goals.
🕵️♀️ How to set effective performance goals for managers? 7 Goal-setting techniques
Applying these techniques can make setting performance goals for team managers easier and more effective.
1. Make goals SMART
You'll hardly go wrong with using the SMART criteria for setting performance goals for team managers.
It makes the goals more useful and achievable.
This is what we mean by the SMART criteria:
- Specific: What you want to accomplish should be clear. It's not general or vague. For instance, optimizing resource allocation and reducing project costs by 20% is a clear goal.
- Measurable: It should be easy to measure performance against the set goals. Define the key metrics or key performance indicators (KPIs) that will indicate their success.
- Attainable: Performance goals should be challenging but within the manager's capabilities. The resources and support necessary to achieve the goals should be within the manager's reach.
- Relevant: The goals should be within the confines of the manager's role. They should also align with the broader priorities of the organization.
- Timely: They should be time-bound. Always set a clear time frame.
2. Use the OKRs framework (objectives and key results)
This is another framework that can guide you in creating effective goals.
It provides clarity on:
- What the manager should achieve.
- The concrete performance metrics that will measure progress toward set goals.
To use the OKR performance management approach, start by defining an objective. Make it ambitious but attainable.
Then, indicate the key results the manager can use to measure their milestones as they progress with their goals.
For example, your managers' objective can be to enhance team collaboration to improve project delivery efficiency.
Why this objective? Team collaboration has been identified as an area of potential growth, and there is a belief that improved collaboration will lead to faster and more effective project completions.
- Streamline the use of collaborative tools.
Currently, teams use 3 different platforms for communication and task management.
Target: Streamline to 1 integrated collaboration platform and achieve a 100% adoption rate by the team within two months.
- Reduce project overlaps.
On average, 5 tasks are duplicated across different team members per project.
Target: Reduce task duplication to less than 1 per project by the end of the quarter.
- Increase team satisfaction with collaborative processes.
The team collaboration satisfaction score is 6 out of 10, according to the latest engagement survey.
Target: Improve the satisfaction score to 8 out of 10 in the following survey after implementing changes.
3. Align the manager's performance goals with company objectives
Derive your managers' goals from your organizational goals. It'll align managers' objectives with the broader goals and ensure they directly contribute to the company's success.
Proper alignment also prevents the various organization's departments from moving in different directions, which can hold back growth.
4. Mix short-term and long-term goals
Create short-term goals that build up to the long-term goals.
Short-term achievements create a sense of accomplishment that keeps the manager motivated. While having long-term goals ensures that the broader vision remains in mind.
Short-term goals also provide immediate direction on what the manager should do to achieve the long-term objectives.
5. Make goal-setting a collaborative process for cross-functional success
When managers from different departments align their objectives, they work towards a singular organizational mission.
Interdepartmental collaboration can also help identify overlaps and gaps in goals, ensuring every function complements the others.
Plus, managers can pinpoint shared resources, avoiding overstretch and optimizing usage.
Tip: Ensure that every manager knows whom to contact in another department. Regular check-ins, perhaps bi-weekly, can help iron out any misunderstandings and ensure everyone remains on the same page.
Involve the managers from other departments when setting performance goals.
Collaboration provides clarity on how the managers' goals relate and jointly contribute to the organization's success.
It also enhances cross-functional alignment.
As a plus, managers get a space to express what they'll need from each other to achieve their respective goals.
6. Set strength-based goals
Most times, we focus on setting goals that work on improving the managers' weak points.
A better approach is to leverage their strengths. It's known as setting strength-based goals.
This approach is a winner because it encourages managers to bring in their A-game. They're more likely to develop innovative ideas that generate the best goal outcomes.
Plus, setting strength-based goals improves the manager's job satisfaction, well-being, and engagement.
As Ryan Wolf, a well-being consultant at Gallup, puts it:
"Strengths-based goals help us focus on what we do best. So, they help us take advantage of all the things that we do with ease, excellence, and enjoyment."
➡️ Our guide on employee performance goals provides tips on setting effective performance goals for regular employees and gives examples. Check it out.
7. Prioritize clarity
The expected outcome of the goals, as well as their objectives, should be clear. It helps managers know where to concentrate their efforts.
According to a research study by Forrester Consulting and Microsoft, these are the top aspects that contribute to goal clarity for at least 80% of leaders:
- clear definition of goal success;
- a clear description of the tasks necessary to achieve the goals;
- a moderate number of goals, enough to show what is expected of them, but not too many that it overwhelms them;
- year-round goal communication;
- alignment with the company's strategic direction.
➡️ Consult our comprehensive guide on evaluating manager performance by linking performance goals to performance evaluations.
💼 45 Examples of manager performance goals you can use
Use these examples to set effective goals for your managers.
Adjust them as necessary to align them with your organization's objectives.
🏢 Examples of SMART performance goals for team managers
📈 Goals for improving team productivity
- Increase team output of completed projects and tasks by 15% within the next quarter.
- Adopt more efficient data visualization software before the end of the year and utilize it for the metrics report of the first quarter of the following year.
- Improve project management strategies and processes to reduce project completion time by 20% over the next six months.
- Demonstrate improvements in individual team members' performance through a 20% increase in task completion rate before the end of the year.
- Enhance the efficiency of resource allocation by minimizing duplicated effort by 30% before the end of the quarter.
🌱 SMART performance goals to enhance team development
- Identify 5 core competencies that align with the team's objectives. Provide team members with access to the relevant training resources and coaching opportunities within the next six months.
- Plan and execute educational programs to develop the team's soft skills within the next six months. Increase the team's average soft skills assessment score by 20%.
- Create training opportunities to improve the team's project management skills. Increase on-time project completion by 20% and decrease scope creep by 10%.
- Execute educational programs to enhance the team's problem-solving and decision-making skills. Achieve a 25% increase in the number of implemented team-generated ideas before the end of the year.
- Enhance the team's average proficiency score in data analysis by 20% within the next four months.
🗣️ SMART goals for improving communication
- Mentor team members in developing their presentation skills. Improve their average score in presentation evaluations to 4 (on a 5-point scale) before the end of the quarter.
- Encourage more team members to share ideas during meetings by enforcing a 'no idea is a bad idea' rule. Increase the number of ideas shared during brainstorming sessions by over 30% before the end of the next six months.
- Model effective email writing practices and provide constructive feedback on team members' email communication. Achieve an average response rate of 90% to team emails within the quarter.
- Implement a monthly feedback survey and achieve a minimum participation rate of 80% within the next six months.
- Coach team members on concise and organized email writing to reduce the number of clarification emails by 25% within the next two months.
✍️ SMART performance goals for strategic planning
- Identify five high-potential employees for leadership positions within the next six months. Mentor and implement a management training program to develop their leadership skills within the next two years.
- Reduce defects and errors by 20% within the next six months by implementing a bi-quarterly quality review process, quality control measures, and process improvements.
- Utilize Lean Six Sigma tools to eliminate process inefficiencies and achieve a 15% reduction in operational costs over the next year.
- Implement a turnover tracking system within the month. Identify trends and establish relevant employee retention strategies to reduce turnover by 20% within the year.
- Implement cost-saving measures to reduce departmental expenses by 15% without compromising quality performance or team productivity.
👯♀️ SMART goals to enhance team collaboration
- Initiate at least two cross-functional meetings next quarter to promote knowledge-sharing and enable seamless collaboration among different departments.
- Implement measures to promote virtual collaboration among remote team members in different time zones. Increase the number of completed projects involving remote team members by 30% in the next six months.
- Implement at least two knowledge-sharing sessions between team members before the end of the month. Establish a digital workspace where team members can share helpful tips, documents, training resources, etc.
- Increase team participation in decision-making to 80% within the quarter by creating forums for team input and recognizing members' contributions.
- Implement a monthly mentorship program where experienced employees can support their colleagues. Match at least 80% of the mentors with mentees before the end of the second month.
➡️ If you want to add some more growth-focused goals, we have a guide on SMART leadership goals examples you can use.
📅 Annual performance goals for Project managers
- Enhance the project planning phase to achieve a 10% increase in projects completed on time and within the allocated budget.
- Identify and mitigate project risks more effectively to reduce the impact of identified risks on project timelines by 25%.
- Achieve a minimum satisfaction rating of 4.5 out of 5 on feedback collected from project stakeholders.
- Ensure 100% of projects have a well-documented scope statement that aligns with the organization's objectives and customer expectations.
- Provide clients with monthly project status updates and reduce response times to customer complaints and inquiries. Achieve a 15% increase in client satisfaction scores related to communication.
🤹🏻 Performance goals for Program managers
- Reduce program costs by 20% without affecting the quality of program outcomes. Track and report on cost reductions every quarter.
- Develop and document mitigation plans for the top five high-priority risks with identified KRIs within the next quarter.
- Identify one relevant certification course for program team members and ensure a 90% training completion rate before the end of the year.
- Implement budget tracking and cost control measures and maintain the budget variance within 5% of the allocated funds.
- Analyze the existing cost allocation processes to improve cost allocation accuracy by 25% before the end of the fiscal year.
🔁 Performance goals for Operations managers
- Identify and prioritize initiatives that will increase the ROI of the company's projects by 15% in the next fiscal year.
- Implement a more efficient demand forecasting system that will reduce excess inventory by 25% and reduce stockouts by 20% within six months.
- Over the next two quarters, streamline order processing workflows and improve cross-functional communication to achieve 95% on-time delivery for customer orders.
- Implement comprehensive monitoring and corrective action processes within the next two quarters that reduce reworks by 20% and waste by 15%.
- Implement new safety protocols and training initiatives to reduce the total recordable incident rate (TRIR) by 20% within the next 12 months.
💰 Performance goals for Account managers
- Identify five high-potential accounts within the next quarter and increase the revenue of each by 15% through cross-selling and upselling.
- Implement measures to increase the average customer satisfaction score by 15% based on post-engagement surveys over the next six months.
- Create a positive customer experience and reduce the monthly churn rate by 10% within the next six months through personalized and proactive customer support.
- Develop strong communication with clients by responding to all inquiries within 24 hours and increase proactive check-ins by 30% before the end of the quarter.
- Identify growth opportunities in the top 10 accounts. Develop and present at least three growth opportunities for each account within the next quarter.
🎯 How to ensure that a manager's performance goals align with the organization's goals: 4 Tips
An emphasis on aligning employee efforts to the organization's strategic direction is one of the significant trends in performance management. And this applies to employees of all levels.
Use these tips to ensure your manager's performance goals drive outcomes that align with the organization's goals.
1. Cascade your organization's goals
Start by defining the larger company goals, then create SMART supporting goals for every manager. Each manager's goals should contribute directly to the larger objectives.
It creates a strong strategic alignment and fosters a sense of shared purpose.
Be sure to establish quantifiable metrics for the manager's performance goals you set.
For instance, if the organization's goal is to increase profits by 20% before the end of the second quarter, the marketing manager's performance goal can be to bring in 35% more qualified leads in the second quarter than in the first quarter.
2. Maintain open lines of communication
Keeping open lines of communication contributes to better goal alignment in several ways:
- Timely feedback and guidance: Managers can get continuous feedback from senior management on any adjustments needed to align their strategies with the organization's evolving needs.
- Speedy adaptation to changes: Organizations often shift their goals in response to market shifts. Open lines of communication allow the managers to stay informed of these changes. And they can adjust their efforts accordingly.
- Awareness of available resources and resource allocation: Open communication helps organizational leaders keep managers in the loop on the resources at their disposal and the organization's priorities.
3. Set monitoring systems
Have a structured process to track the progress, outcome, and alignment of managers' and organizational goals.
An AI-powered performance management process can help you achieve more accurate results.
It can highlight areas where managers' performance has strayed from the organization's priorities. Managers can then take timely corrective actions.
💡 Tip: Use data from your monitoring systems to reward managers' success that contributes directly to the organization's goals in your performance evaluations. It reinforces the importance of alignment with the larger organization's objectives.
4. Align projects to organizational goals
Ensure a clear connection between the managers' daily projects and the organizational goals and strategic priorities.
It should be possible to measure the outcome of the managers' projects against the KPIs you've set for your organizational goals.
➡️ Drive performance and growth with Zavvy
Setting the right performance goals for managers drives effective leadership throughout the organization.
But your work continues beyond goal-setting. Goal tracking is equally essential. And so is follow-up.
A continuous feedback model powered by our customizable 360-degree software can help you gather all-rounded insights into how the manager is progressing with their goals.
Once you have these insights, use Zavvy's one-on-one meeting software to discuss them with the manager.
Brainstorm solutions to any challenges they could be facing. And realign the goals with the organization's goals, if necessary.
Next, measure the goal outcomes. We use our performance review software to assess the manager's strengths and weaknesses and document an action plan to improve their performance.
Finally, begin again by setting performance development goals for the next period, all within Zavvy.
📅 Request a demo to see Zavvy in action.