{"id":125,"date":"2017-08-07T16:13:34","date_gmt":"2017-08-07T16:13:34","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/atd-tc3-management\/?post_type=chapter&p=125"},"modified":"2017-08-07T16:13:34","modified_gmt":"2017-08-07T16:13:34","slug":"the-nature-of-goals-and-objectives","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/atd-tc3-management\/chapter\/the-nature-of-goals-and-objectives\/","title":{"raw":"The Nature of Goals and Objectives","rendered":"The Nature of Goals and Objectives"},"content":{"raw":"
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Learning Objectives<\/h3>\r\n
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  1. Know the difference between goals and objectives.<\/li>\r\n \t
  2. Know the relationship between goals and objectives.<\/li>\r\n \t
  3. See how goals and objectives fit in the P-O-L-C framework.<\/li>\r\n<\/ol>\r\n<\/div>\r\n
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    What Are Goals and Objectives?<\/h2>\r\nGoals and objectives provide the foundation for measurement.\u00a0<\/span>Goals<\/span><\/span>\u00a0<\/span>are outcome statements that define what an organization is trying to accomplish, both programmatically and organizationally. Goals are usually a collection of related programs, a reflection of major actions of the organization, and provide rallying points for managers. For example, Wal-Mart might state a financial goal of growing its revenues 20% per year or have a goal of growing the international parts of its empire. Try to think of each goal as a large umbrella with several spokes coming out from the center. The umbrella itself is a goal.\r\n\r\nIn contrast to goals,\u00a0<\/span>objectives<\/span><\/span>\u00a0<\/span>are very precise, time-based, measurable actions that support the completion of a goal. Objectives typically must (1) be related directly to the goal; (2) be clear, concise, and understandable; (3) be stated in terms of results; (4) begin with an action verb; (5) specify a date for accomplishment; and (6) be measurable. Apply our umbrella analogy and think of each spoke as an objective. Going back to the Wal-Mart example, and in support of the company\u2019s 20% revenue growth goal, one objective might be to \u201copen 20 new stores in the next six months.\u201d Without specific objectives, the general goal could not be accomplished\u2014just as an umbrella cannot be put up or down without the spokes. Importantly, goals and objectives become less useful when they are unrealistic or ignored. For instance, if your university has set goals and objectives related to class sizes but is unable to ever achieve them, then their effectiveness as a management tool is significantly decreased.\r\n\r\nMeasures<\/span><\/span>\u00a0<\/span>are the actual metrics used to gauge performance on objectives. For instance, the\u00a0<\/span>objective<\/em>\u00a0<\/span>of improved financial performance can be\u00a0<\/span>measured<\/em>\u00a0<\/span>using a number metrics, ranging from improvement in total sales, profitability, efficiencies, or stock price. You have probably heard the saying, \u201cwhat gets measured, gets done.\u201d Measurement is critical to today\u2019s organizations. It is a fundamental requirement and an integral part of strategic planning and of principles of management more generally. Without measurement, you cannot tell where you have been, where you are now, or if you are heading in the direction you are intending to go. While such statements may sound obvious, the way that most organizations have set and managed goals and objectives has generally not kept up with this commonsense view.\r\n\r\n<\/div>\r\n<\/div>\r\n \r\n
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    Measurement Challenges<\/h2>\r\nThere are three general failings that we can see across organizations related to measurement. First, many organizations still emphasize historic financial goals and objectives, even though financial outcomes are pretty narrow in scope and are purely historic; by analogy, financial measures let you know where you\u2019ve been, but may not be a good predictor of where you are going.\r\n\r\nSecond, financial outcomes are often short term in nature, so they omit other key factors that might be important to the longer-term viability of the organization. For instance,\u00a0<\/span>return on sales<\/em>\u00a0<\/span>(ROS, or net profit divided by total sales) is a commonly used measure of financial performance, and firms set goals and objectives related to return on sales. However, an organization can increase return on sales by cutting investments in marketing and research and development (since they are costs that lessen the \u201creturn\u201d dimension of ROS). It may be a good thing to cut such costs, but that type of cost-cutting typically hurts the organization\u2019s longer-term prospects. Decreases in marketing may reduce brand awareness, and decreases in research and development (R&D) will likely stifle new product or service development.\r\n\r\nFinally, goals and objectives, even when they cover more than short-term financial metrics, are often not tied to strategy and ultimately to vision and mission. Instead, you may often see a laundry list of goals and objectives that lack any larger organizing logic. Or the organization may have adopted boilerplate versions of nonfinancial measurement frameworks such as Kaplan and Norton\u2019s Balanced Scorecard, Accenture\u2019s Performance Prism, or Skandia\u2019s Intellectual Capital Navigator.\r\n\r\n<\/div>\r\n
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    Goals and Objectives in P-O-L-C<\/h2>\r\nGoals and objectives are an essential part of planning. They also have cascading implications for all the aspects of organizing, leading, and controlling. Broadly speaking, goals and objectives serve to:\r\n