Page 165 - Finance for Non-Financial Managers

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Finance for Non-Financial Managers
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How much of the desired result constitutes success—$50,000 or
five offices or 15 new employees? By when will the goal be
achieved—a specific date or a specific length of time after
beginning? This specificity is needed in order to ensure that
everyone knows if the goal has been achieved or not. I suggest
to workshop audiences that the goal is specific enough if you
can be assured your 16-year-old daughter would recognize it.
Measurable. You must be able to measure the success with
available data. Setting a goal to capture 20% of the market by
year end is specific enough, but if there is no industry data
available to measure who has what share of market, it’s a
meaningless goal. Set goals in areas where you can get reason-
ably reliable information. Bonus: it will preclude your staffers
writing off the goal as smoke because they too know it can’t be
measured.
Achievable. The goal must be challenging, but still achievable.
More to the point, it must be perceived as achievable. If the staff
perceives the goal as patently unattainable, they’ll give up on it
from Day 1 and any efforts to reach the goal will be wasted.
Goals should be set so they are a stretch beyond what exists
when the goal is set, so people recognize they need to exert
effort to get there, yet they should have a reasonable belief that
if they really shoot for it, they can get there.
Relevant. The goal should certainly be relevant to the organiza-
tion’s vision, mission, and strategy. That’s the whole point, after
all: to get to the vision. But occasionally a manager will get
excited about an opportunity that doesn’t relate to the mission
and will devote resources to achieve what sounds like a great
idea. The problem? It takes resources and focus away from the
job of the organization—fulfilling the mission.
Trackable. My word, not Webster’s, but its meaning adds real
substance to our goal-setting methodology. A goal is trackable
if you can establish milestones to track progress toward the
goal. This enables you to monitor progress and avoid unpleas-