Delinking Individual Goals and Company Performance
Delinking Individual Goals and Company Performance By Dr Riaan Steenberg A company can have many individuals achieving their targets while the organisation…
By Dr Riaan Steenberg
A company can have many individuals achieving their targets while the organisation becomes weaker. This is the danger of linking personal goals to company performance too mechanically.
Local Success Can Damage the System
Sales can hit volume while margin collapses. Operations can cut cost while customer trust erodes. A manager can meet a target by borrowing from the future.
Individual goals must be tested against system effects, not only local outputs.
Use Goals for the Right Purpose
Some goals guide development. Some guide operating rhythm. Some guide reward. Confusing these purposes encourages people to manage the measure instead of improving the business.
Reward-linked goals require special care because they shape behaviour quickly.
Review the Design
Performance reviews should ask whether the person achieved the goal and whether the goal was well designed.
A poor goal can produce poor behaviour from capable people. Management must own that design risk.
Individual goals are useful when they clarify contribution without fragmenting the system. The real test is whether the company becomes stronger, not whether scorecards look tidy.
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