Why Set Business Goals for Employees?

Why Set Business Goals for Employees?

Posted on:
by Michael Lantry
IT Jobs and Recruitment Insights

Organisations have goals. These can be financial goals or sales goals, or growth in headcount goals etc. When you are working within an organisation, you will often hear about these goals at team, division or ‘all-hands’ meetings. 

This is all very important as the employees of a company should know what they are trying to achieve, together. But these goals very often don't directly impact individual employees, day to day. 


For example, a Sales Manager will have a huge impact on sales goals but will have very little to do with a goal to grow two new software engineering teams within the technology division. Sure, everything is interlinked, but on the ground, day to day, individual employees don't have an impact across all business goals. 

Therefore it's quite possible that employees can view some organisational goals and objectives to be a bit abstract and not really anything to do with them. So what can managers do to negate the risk of employees disconnecting themselves, mentally, from the organisational goals of a business?

A manager must start with setting goals for their employees. This is what I am going to talk about today in this blog. I would like to highlight the importance of setting business goals for employees but also go on to suggest some practical steps in how to do this. 


A word of advice: It is important to make the point here that setting goals, on their own, is not going far enough. A top manager must go further to then build associations in the mind of their employees between their own goals, and those of the wider business. Creating these connections is the key to ensuring everyone takes ownership of delivering on the organisational goals.

setting employee goals


An employee must have their own set of goals. You see them called Personal Professional Goals or Career Development Goals or Milestones etc. Call them what you like, these are goals tailored for the employee in their specific role. 

The purpose of these goals is not just to highlight the impact on the organisation’s end goal, but also, and more importantly, so they have personal goals to strive for. 

It's so important that an employee has somewhere to go in their role. Somewhere to grow into and develop as a person. Be it expanded leadership responsibilities or increased operational management responsibilities. The importance of goals for employees cannot be overstated. 

These goals give direction, they increase engagement, they improve retention, they enable individual growth, they make a company more attractive to the outside talent market, they give people purpose and meaning and a sense of worth within the team. The list goes on and on. In our current world of remote working, clear goals allow teams to be outcome focused, which gives trust and autonomy to people, which drives business performance ultimately. 

So hopefully you are convinced of the benefits of setting goals for employees. But how do you go about doing this? Let's keep it really simple. 


Below are just four simple rules to setting goals for an employee in an effective way:

4 simple rules for setting employee goals

  1. Involve the employee

    This seems obvious but is crucial. It makes sense that if you want someone to own their own goals and really feel motivated to achieve them, then they should be heavily involved in setting the goals. 

    There is the added benefit of getting a much better understanding of how ambitious this individual is within the organisation. This will help you understand, long term, what this employee might be capable of doing for the team. 

  2. Use the SMART goals model to frame the goal setting process

    The SMART model is a well known approach to goal setting. It forces you to ensure that the goals you are setting are Specific, Measurable, Achievable, Relevant and Time-Bound. This model is really useful in setting goals that can be then rewarded and reviewed over time. 

  3. Reward the employee when they achieve goals

    This is so important. You need to reward an employee when they achieve their goals. This reward does not always need to be financial either. In fact, many studies have shown that recognition and praise that is not financial, is more valued by an employee.

    You can give recognition with vocal praise. For this vocal praise to be valued, it should be genuine, specific, timely and meaningful. Other forms of recognition and reward are giving time off, food, trophies and awards and experiences (e.g. if they hit a goal, the employee or team go paintballing). 

  4. Review on a regular basis

    There is no point in setting goals and then putting them to one side and never looking at them again. Or worse, just pull them out twelve months later at an annual review. This approach to goal setting would actually be counterproductive and result in reduced motivation and engagement, in my view.

    The goals need to be living breathing things. They may need to be amended based on unforeseen circumstances (like Covid). My view is that employee goals should be discussed between the manager and the employee once a month. It might be quick to check that things are on track, or there may need to be more discussion.

    For example, if it's obvious that a goal is not going to be hit, this needs to be tackled head on. Work together to understand the reasons why, and then put in place actions to try to get back on track. 

    As well as this, the employee will feel more valued if the manager takes a genuine and regular interest in how they are getting on with their goals. This is so important. 


In summary, I cannot underestimate the importance of goal setting for employees within an organisation. I have highlighted some of the many reasons why here. More than this though, a manager should try to follow these four simple steps for effective goal setting. If this is done well, then the employee should have increased engagement and performance. 

If you want to discuss goal setting in your organisation, please just get in touch with me on michael.lantry@gempool.ie. I would welcome the opportunity to help in any way I can. 

To read more insights and articles please visit our IT career insights page.

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