I’m going to go way out on a limb and presume that pretty much everyone reading this is somewhat familiar with SMART goals. This was defined by Peter Drucker over 50 years ago as Specific, Measurable, Action oriented, Realistic, and Time bound. Now I’m not saying I’m smarter than Drucker, but lately I have found value in updating his classic acronym.

SMARTS. Specific, Measurable, Aligned, Relevant, Time bound and Stretching. Just a few changes that can help goals resonate a little more with today’s emerging workforce.

Aligned. It’s critical for the organization and the employee that individual goals be congruent with the greater goals of the organization. It’s equally important that there be a clear and identifiable line of sight from the employee’s goal to the organization’s. That’s when goals become self motivating and less like they are being assigned by manager fiat.

Relevant. There needs to be a connection between the work the employee’s asked to complete and the work of the rest of the team, department or organization. Plus, it’s best when there is a connection between the employee’s skills and the objective. That’s when the employee feels they’re really making a contribution. As Daniel Pink makes it clear, people perform better when they feel that there’s a purpose to what they’re being asked to do.

Stretching. We need our employees to do more than just enough not to get fired. We need them to voluntarily give their discretionary effort. As mentioned previously, most employees, if we do our jobs right all employees, come to work to do a good job. Just as you do. So when setting objectives, don’t just tell them what needs to be done, describe the standards for each level of performance. Give the employee the information he or she needs to excel. Help them to make an informed decision about how hard to work and how hard to try. Don’t worry about outlining the rewards just yet. That will come, rest assured. For now, keep their eyes on the improved performance prize and help them to develop pride in doing their jobs well.

This is all getting around to rewards and recognition, another of my favorite topics, Soon to come in yet another post on one of my favorite topics, motivating superior performance.

So says Mayor Shinn in “The Music Man.” Sound advice when devising a ratings scale for your performance management system. There’s pretty much general agreement that we need to move away from the old numbering system that took a hold of organizations for decades. In defense of numbers though, at least it was clear where you stood in the manager’s opinion.

Instead we’ve been blessed with a waterfall of words that often cloud the manager’s intent more than clarify it. Quiz time!

Which is better? (taken from an actual appraisal I saw)

1. Outstanding
2. Superior
3. Vastly Proficient

Pencils down! If you answered “B”, go take a celebratory lap around the office and get me a cup of coffee while you’re up. This organization had backed so far away from telling employees where they stood that no one recognized a need to improve. Needless to say the organization was floundering, hence the need to bring in a performance consultant (me!). If you’re curious the order of these top three ratings were Superior, Outstanding, Vastly Proficient followed by Meets and then Somewhat Meets. It’s like Lake Woebegone where all the children are above average.

Your employees are not children. They’re adults who crave feedback. How many of you go to work each day to do a lousy job. What, no hands? Of course not. Your employees feel the same way. For the most part, they come to work to be productive, put in an honest day’s work and feel that they’ve made a contribution. Okay, I know Homer Simpson is lurking out there somewhere, but I don’t think even Homer thought he was doing so bad. Not with the kind of feedback he was getting from Mr. Burns.

Base your performance feedback and ratings on carefully determined measurable, controllable, achievable SMARTS goals and then, using the four tier scale I mentioned in my last post, “Exceeds Standards”, “Meets Standards”, “Partially Meets Standards”, and “Does Not Meet Standards” you’re leading the band to better management.

Wait, did he say SMARTS goals?
Doesn’t he mean SMART goals?
Heavens to Drucker, next post!

Now you may have thought from my last post when I railed about the often ineffectiveness of the ubiquitous five point evaluation scale that I favored a GE-style three tier system. Not at all. Interestingly, many of the comments I received talked about how some organizations have done away with numeric scales entirely and use descriptive phrases. Not once in my last post did I mention using a numeric scale, and I agree that applying seemingly arbitrary numbers does more harm than good. But don’t fool yourself. Using adjectives from “superior” or “outstanding” down to “unacceptable” or “unsatisfactory” is the same as telling someone that they’re a 1 or a 5. Everyone correlates those words to a number. They can’t help themselves. The inefficiency of some appraisal phrasing is the topic for another time, right now I want to share the evaluation framework I advocate.

No safety net. Four levels of performance. And no flowery language either. The effective way to communicate performance feedback to your employees is to set standards for acceptable performance and then measure them compared to those standards. The top level of performance is “Exceeds Standards”. The next is “Meets Standards”. Then “Partially Meets Standards”, and finally “Does Not Meet Standards”. Two levels above the line and two below. No middle ground, no safety net. Just a clear statement of either you made it or you didn’t.

I’ve heard people within organizations say this is harsh, this isn’t fair to the employees and I disagree. The employees I’ve spoken with make it quite clear that they want to know where they stand. My brother in sales management says he always tells his new employees that “No” is the second best answer. Because then you know where you stand. Your employees are the same. They want to know and it’s often because they want to improve.

A key objective of a manager’s job is to manage the performance of the team. Setting clear, measurable goals and then communicating with employees about how they’re doing on meeting those goals are two  crucial roles in meeting the manager’s goal.

Would you pay full price when you’re only going to use 60% of the product? If you have a five point performance rating scale (the most common iteration) yet no one ever gets the highest or lowest rating, then you’re only using 60% of the system. In fact, SURPRISE, you actually only have a three point scale.

Whatever the reason for not using the highest or lowest rating, and I think I’ve heard them all, the company is sending a very muddled message to the employees.

“If we give him the lowest rating he’ll get demoralized and demotivated.” If an employee’s output is so minimal that you’re considering the lowest rating, he’s likely already demoralized and stopped trying to accomplish anything long ago. “Well, we don’t want to hurt his feelings.” Really? I’m much more impressed by a manager who doesn’t want to hurt the bottom line!

On the other end of the spectrum is “we don’t want to give her the highest rating because she’ll get complacent.” Don’t worry. Someone that good is never going to get complacent. If she’s so good that you’re considering the highest rating, she’s probably self-motivated enough to want to keep up that pace to replicate that performance, and hopefully that reward. This is the person you have to worry about demotivating. She knows that her performance is good enough to warrant the highest rating so when she doesn’t get it, that’s demotivating. This is the employee whose enthusiasm and performance I would hate to diminish. And also the employee I’d hate to lose because she doesn’t feel appropriately recognized for her hard work.

So you may think I’m advocating for a Jack Welch GE-style three tier evaluation system. Nothing could be further from my mind. If you have a five level evaluation system, use it to really differentiate employees’ performance. When a manager fails to use all the tools at his or her disposal, it’s like a six cylinder car that’s only using four. Turbo charge your performance management system by using every level appropriately and then you’ll be getting more bang for your buck.