Say you have an objective to grow online sales by twenty percent in 2008. If you are responsible for the e-mail program, with a list of 100,000 subscribers receiving 52 e-mails a year that generate $0.25 per e-mail, your e-mail program drives 100,000 * 52 * $0.25 = $1,300,000 on an annual basis.
If online sales are supposed to grow by twenty percent, your e-mail volume had better grow by at least twenty percent next year!
Therefore, your objective might look something like this:
Increase annual e-mail volume by at least twenty percent in 2008 on a program that includes one campaign per week and a twenty percent increase in the total e-mail marketing budget. Increases can come from file growth and productivity per e-mail delivered.
- "A" = $1,755,000 or more annual volume.
- "B" = $1,625,000 to $1,754,999 annual volume.
- "C" = $1,495,000 to $1,624,999 annual volume.
- "D" = $1,365,000 to $1,494,999 annual volume.
- "F" = $1,364,999 or less annual volume.
Notice that the objective says little about "how" the objective will be met. There is language that insures that e-mail campaigns will be "weekly" --- the team cannot achieve this goal by sending a campaign every-other-day. There is language that dictates the annual marketing budget, this language will limit the ability of folks to go hire a high-powered vendor, for instance.
After outlining the rules, it is up to the staff managing the program to figure out "how" this will happen.
At the end of 2008, performance is measured against this standard. Employees should feel good about earning a grade of "C" --- it means they delivered performance necessary to meet company objectives.
It is really important to set these objectives before the fiscal year starts. Employees need to be given a chance to impact business, to be given a chance to plan ahead and secure the resources necessary to achieve great performance. Some companies roll out objectives or bonuses well after the fiscal year begins. Employees cannot impact annual results when this happens.
Your turn --- what have you observed when it comes to creating performance objectives?