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Setting objectives is good for your business

By November 18, 2012 May 6th, 2020 No Comments

Objectives seem like broccoli for most people. You know broccoli is good for you — cholesterol lowering, anti-inflammatory — but you just don’t like the stuff. And if you are like most people, you don’t give broccoli another thought until you are suddenly scared out of your wits by a high cholesterol diagnosis or even worse health news.

Same with objectives, the business “exercise” we all love to hate. Intuitively, we know that good objectives are an effective business tool, but then we remind ourselves that we have been getting by just fine with the least amount of effort.

Well, not really. The last three years of business results should have been enough to scare the wits out of you, your executives and your employees. That makes 2013 the perfect year to make real inroads into attitudes about objectives in your business culture.

Want to do more employee development but find yourself with a shrinking budget? Take a step back and think about this from a fresh angle. Strategy meetings followed by objective setting is your best, most cost-effective opportunity for developing your employees’ performance. 

Objective setting teaches employees what they can do to contribute to the business. It challenges managers to analyse operating results and discuss the findings with employees. It gives your company a business communications bonanza with easily measurable outcomes.

At an organisational level, objective audits by HR enable you to resolve problems rather than sweeping them under the rug only to find out later that business results are below par.

You may not want all of your leaders to get as innovative as the manager below who used objective setting as a way to educate his employees, but this may illustrate how good the “broccoli” could be for your organisation. In this guy’s department, I bet the financial impact was impressive. As the story goes, he kept: ‘. . . urging his employees to lower their scrap rates. He deluged them with numbers: cost of materials, production efficiency, and so on. But they didn’t get it. Finally he called his employees into the break room. When they got there, they saw the boss — with an old couch and a chain saw. Dumbfounded, they watched the guy fire up the chain saw and lop off about a third of the couch.

“That”, yelled the boss over the din, is the cost of materials that actually go into our product line. Then he lopped off another third, for labour. Lastly, he shut off the saw and pointed to the remaining third. You could hear a pin drop. “That,” he said, “is how much we’re wasting in scrap.”

If you would like advice on KPI and objective setting, call us on 03 9909 7411 or email the Brownie Points team at

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