EMPLOYEE OBJECTIVES 329
While you were developing your business plan, you designed an organisation struc-
ture that would make it work. If this was high-level, you should extend it to identify every
employee. Finally you pull this out into job specifications and job descriptions. (You
already know from your resource plans where you need to recruit.) Now all you have to
do is communicate the responsibilities to the individuals concerned. The best way is in an
employee objective-setting exercise.
Employee objectives
Almost the final step in turning a business plan into action is making sure that everyone
knows what they should be doing. In the same way that strategy turns into action, so stra-
tegic objectives result in objectives for each employee. Figure 13.5 earlier could almost be
re-labelled top-to-bottom with the words objectives, targets and milestones.
In fact, I have illustrated the way that objectives cascade downwards in Figure 13.6.
The broadest strategic objectives are set at the corporate level. Managers at the first
level – general managers – have specific, mainly strategic objectives framed around the
corporate objectives. And as you move down through your line management structure,
objectives become more precise, more operational, and more urgent.
Corporate objectives
1. Increase revenue by $2 million in the year
ending 31 December
2. Increase market sha
3. Boost profits by 25%
Objectives for division II
1. Increase divisional revenue by 30% in
the year ending 31 December.
2. ar e by 33% in
Objectives for production
1. Increase production efficiency by 25
2. Reduce by 10% the number of defe
Objectives for sales
1. Achieve 30% incr ease in sales value for
prepacked cut and stamped whatsits.
Objectives for Ellen the engineer
1. Ensure that the cutting and stamping
machine is not out of service for more
3 hours a month.
2. Ensure that supplies of grinding oil are
Objectives for Sam in sales
1. Increase number of leads generated to
40 a week.
2. Visit at least 15 new prospects a week.
Figure 13.6 Cascading objectives
330 CHAPTER 13 NOW MAKE IT HAPPEN
I use the word urgent in a time-related sense. I would expect a general manager to have
objectives with a longer horizon – achieve this in the next 12 months. I expect clerks and
computer programmers to have objectives measured almost in hours – do this in the next
two days. Maybe I am being a little extreme, but I am sure that you can catch my drift.
‘Everybody knew what Walt wanted. Everybody had objectives. Both were communicated
all the way down the line. The management layer was flat and responsibilities were clearly
defined. We had a good self-image and the company ran well.’
EXWALT DISNEY EXECUTIVE WHEN THERE WERE 2000 EMPLOYEES
MANAGEMENT BY OBJECTIVES
You can see where I am heading. Develop personal objectives for each employee based
on the overall business plan, send them off to do their bit, and everyone will be pulling in
the same direction. They use your policies, rules and procedures in pursuit of their objec-
tives, and your plan is executed exactly as you intended.
You can also measure employee performance against target. You then have an
employee appraisal system – management by objectives. As at the corporate level,
employee objectives should be defined concisely with clearly measurable targets. Here
are some things to think about.
Fifteen words to think about when setting objectives
Five measurements to quantify and include in all objectives
1 Change Increase by 25% …
2 Entity or action the number of cold (i.e. new, uninvited) calls …
3 Quality
to prospective customers confirmed as potential investors …
4 Cost without increasing headcount …
5 Time in the period July to December this year
(compared with the same period last year).
Five terms to avoid Five words to qualify
1 Minimise (maximise) 1 Improve (by how much?)
2 Enhance 2 Increase (by how much?)
3 As soon as possible 3 Reduce (by how much?)
4 As appropriate 4 Restrict (by how much?)
5 Adequate 5 Limit (by how much?)
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