Business goals are the holy grail of performance reviews. Or, at least they should be. After all, the business goals we work to achieve should be the most important work we can do to help the business achieve its goals for the year.
Goals, though, are a slippery slope when it comes to performance reviews. Here’s why:
1. They are a high percentage of your performance review
In large companies, your goal attainment can be 75% — or more — of your performance review. Hit your goals — golden! — and the raises and awards are awesome. Mess them up through missing your targets and frustration will set in.
How you manage, report, and communicate your goal attainment, then, makes a big difference in your paycheck.
2. The number of goals impact your performance review
Have one goal you need to hit on your review — and then miss it. What does that mean for your pay? You got nothing is what it means. The fewer your goals on your performance review, the more you are swinging for the fences.
The more goals you have on your performance review, on the other hand, the more likely you will simply do “average” or “successful” on your performance rating. Why? Because you’ll knock some out of the park and the others you won’t. And, on average, well, you’ll be average.
Now, there are some good reasons to be average and there are good reasons to try and have fewer goals so you can knock some out of the park. How well your company is doing and how likely are there to be layoffs based on performance come to mind. Lots of goals can be a great thing — or really bad for you depending on your situation.
3. How you modify your goals makes a difference
Ever had a great goal in January that is no longer relevant in March — but still shows up on your performance review in December? We all have. Those goals can be the kiss of death in our performance review rating because the manager essentially shrugs his or her shoulders and says, “Well, the best I can do with this is average because that’s all we did with this goal.”
If you don’t modify your goals as you go through the year to reflect what is happening with the business right now, you’ll get the shoulder shrug — and lost dollars on your paycheck — too.
Goals are important to your pay, career achievements, and business results you achieve. That’s why I have a SMART Goals product — they are the foundation for getting your performance review right.