Business Goal Setting: How to Improve Team Performance & Morale

Business Goal Setting: How to Improve Team Performance & Morale
by SkylineG

When it comes to setting and accomplishing business goals, a lot of companies think bigger is better - and they want them to be big.

But when it comes to setting business goals, setting big stretch business goals can motivate employees, but if the resources, support, and even the potential for success are not aligned, the result may not only be a failure to achieve the business goal, but also damaged morale.

A June 2017 study from the Institute for Operations Research and the Management Sciences looked specifically at stretch business goals. Most people think setting them has a positive impact on overall performance, but researchers found stretch business goals actually undermine performance for most companies.

The failure rate of achieving business goals they found in the study was surprising -- 80% of participants failed to reach their assigned stretch business goals.

This brings into question how leaders and companies should approach and create individual, team, and broader business goals.

This article outlines the six key actions needed to identify, align, and achieve business goals.

1. Define and Prioritize Business Objectives

Business success and goal-setting success begins with the leadership team clearly identifying business goals and the business strategy to achieve those business objectives.

High-level business goals must be clear in terms of the outcome, metrics, and what achieving each goal will look like.

Setting clear, achievable business goals should be led by the CEO and have the support of each leader of various business functions and aligns the company in the right direction.

Less is more when setting achievable measurable business goals. Set goals that are focused on only the top priorities.

Each business goal needs to be owned by a specific individual who has not only the accountability but the resources to achieve their business goals.

Each business goal must have clear milestones, metrics, and outcomes as aligned with broader business goals and strategy.

Each goal should have clear outcomes such as an increase in revenue, a set time period, ways to measure progress, and other factors such as who is in charge of decision-making.

2. Team Goal Setting

Once broader company or division objectives have been established the next layer of achievable goal-setting takes place.

Goal setting should align and cascade through a company. When considering and setting team goals it should be obvious what goals align with the broader goals and objectives of the company.

These goals should be owned by the manager of the team and follow the same process used by the leadership team to set business goals.

3. Individual Goals

Having a clear goal-setting process is critical. Your goal-setting process should include all employees from business leaders to front-line employees throughout the entire organization.

It can be devastating when a person falls short of an objective. It is even more frustrating to not achieve an objective when it is a goal that is set for you -- not by you.

People feel more invested and excited by their goals when they’re involved in the creation process.

As you begin to identify measurable goals with an employee, share the larger business objectives and the big picture that you, as a leader, are looking to achieve.

Provide some initial ideas of the business objectives that link the individual's role to key performance indicators, these broader business objectives. Be sure to ask for ideas and input from your employees.

Then, have them set three reasonable measurable goals that are aligned with the company objectives and the business strategy that they want to achieve. Set deadlines for each goal.

This goal-setting process gets everyone on the same page to ensure business effectiveness -- leadership gets a clear understanding of what they can expect from each person, and people see the big picture and feel confident in working towards business goals that align to their individual objectives.

Business goals should also reinforce a sense of purpose and align with your mission statement.

4. Use Data To Set And Track Business Goals

People tend to underestimate their abilities when considering their individual objectives as aligned with business goals which make for a potential obstacle when they work to set performance goals with leadership.

They may not remember what their full potential actually is.

Instead of having people dispute what are realistic business goals and what are impossible business goals, present the facts to them.

Present data related to the broader business goals and how their performance goals connect.

Use ongoing assessments and reviews of their progress to reinforce what they’re capable of accomplishing.

sing a goal-setting framework such as smart goals for your business can be useful in measuring progress.

Keeping track of team and individual goals is easy when you have the right foundation and processes in place.

Setting well-crafted goals should be easy. Set goals that are time bound. Create business goals that outline key results such as an increase in revenue over a period of time. Smaller short-term goals should align with long-term goals. Long-term goals, in turn, must also be managed to ensure relevance aligned to top priorities and long-term business objectives.

By relying on supportive data, employees are more likely to see and believe they can reach a business goal, which not only helps them when they create and track their objectives but also helps when they strategize and execute both their own and company goals.

5. Explain What Success Looks Like

To know if people are on track toward a goal, they need to know what the end looks like.

When the idea of either short-term goals or long-term business goals is too abstract, employees become less motivated and lack clarity. Specific actionable goals and objectives should be clear in terms of outcomes.

However, if you paint them a picture of what victory looks when setting business goals, sounds, and feels like, they can work toward a concrete vision. This is where visualization comes in.

Athletes resort to visualization to make improvements in their performance. In fact, a 2014 study published in the Journal of Strength and Conditioning Research looked at 16 male sprinters. When they used imagery to visualize what their results looked like, they were able to reduce their sprint times.

People can better explore ways to hit their performance goals if they know how achievement would feel. Help them see and feel it, and they can shift their mindset.

As part of this process for identifying success, ensure that the resources required to achieve the goals have been identified and can be provided.

6. Provide Greater Context for Your Business Strategy & Objectives

If people don’t understand how their individual performance goals impact others or connect with broader business goals, they might feel like their effort isn’t going to be recognized or how they influence something bigger and help to move the company in the right direction.

However, if you help them see the whole picture, when setting business goals, they will understand how meaningful their role is and strive to be their best. They won’t feel like just a cog in a machine.

The bigger picture shows them that their daily tasks are not meaningless and in fact connected to vital company goals and progress. This new context demonstrates how their day-to-day leads to the organization progressing toward its overall mission and reaching time-bound business goals.

Setting goals should be a process that engages people and increase employee satisfaction.

7. Celebrate Business Goal Milestones & Achievements with The Team

Celebrating milestones and achievements is an effective strategy for enabling leadership success as it helps to keep both the leader and those who are leading motivated and inspired; it reinforces the idea that their hard work is paying off.

Celebrating wins also provides cause for celebration, which makes people feel seen and appreciated, creating a culture of recognition and appreciation within the organization.

Additionally, celebrating milestone successes sets higher standards for future performance by showing teams what can be achieved when goals are met. This demonstrates what it takes to become successful in reaching ambitious business goals, provides a source of motivation, and encourages them to strive to reach even greater heights of achievement.

Ultimately, through celebrating accomplishments both minor and major, leaders can create an atmosphere of winning that will drive everyone involved towards more success in achieving their leadership aspirations.


Leadership and company success begins with setting clear, measurable, and achievable goals. When time and effort are invested in the goal-setting process, leaders ensure that every division, team, and individual is aligned and working towards common objectives. As you think about your company or team are goals clearly articulated and are people aligned on the goals? What are the steps you can take to ensure your team is more aligned, clear, and enabled to succeed?