No matter how SMART your goals are, if you don’t get people to change their behaviors, there’s no way you’ll ever achieve the goal. By clearly articulating what behaviors they need to change and explaining how those changes tie to goals, you’ll increase your chances of “making your numbers.”
The reason we set goals is to drive different outcomes. That means behaviors need to change. You need to know what the current behavior is, what the preferred behavior should be, and have the right incentives in place to make people change to that new behavior. You’d be remiss to set a goal and not tell people how they should behave differently in order to achieve it.
Explain which behaviors should change and how you’re going to monitor those changes. What new skills do you need your people to build? Do you need to train them, coach them, give them different resources? What new information or resources will they need to demonstrate these new behaviors? If you want to hit your goals, tell people what the new behaviors are that you expect. Setting a goal without telling giving your team members behavioral guidance is a recipe for failure. Make sure they know how they should change the way they work and reinforce those changes regularly.
There’s a consumer packaged goods company that had a large sales force. That sales force was previously given incentives based on the revenue they generated. The company was trying to grow which was their strategic imperative. Their original goal of driving revenue was tied to that strategic goal of growth.
All the salespeople had individual revenue goals for the year. The behaviors that led to was first, the salespeople discounted heavily to drive revenue and steal share from competitors. Sales people also chased small accounts because they were easier to sell to even if they were more costly to service. Lastly, salespeople sold any product in the portfolio just to make the sale, rather than focusing on the products that drove profits.
Over time the company changed its goals. They decided not to focus on growth anymore and instead decided to focus on profitability. They needed to change from having a sales goal to driving a gross margin goal. They told the salespeople what behaviors to change. They encouraged them to stop discounting because every dollar discounted was a lost dollar of profit. They had their salespeople focus on larger customers. They’re they’re cheaper to serve therefore the company stood to make more margin by working with them. Lastly they told the salespeople to sell more profitable products. They gave them the list of the most profitable products and encouraged them to sell those products first.
To reinforce these behavioral changes, they also changed the entire incentive plan to align with these new behaviors. The result was those salespeople started selling much more profitable revenue. They were selling to bigger accounts, selling more profitable products, and they were reducing their use of discounts. That helped the organization achieve its broader goal of becoming more profitable.
Look at the goals that you’re setting, understand the behaviors people are demonstrating now, and what behaviors need to change to in order to achieve the goal. The more clearly you can spell out how you want people to behave, the higher the likelihood they’ll change their behavior and help you hit your goals.
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