Objective Setting

Contents 1 Applications 2 Procedures 3 Instructions          3.0.1 4 References

This technique is used to set specific objectives for an enterprise as a whole and/or for a particular enterprise change project or initiative. An objective can be defined as a specific result the enterprise (or project) would like to achieve within a specified time period. Objectives differ from goals, where a goal is a specific target to be reached. For example, "to reduce operating expenditures during Q4 1994" and "to increase total return on investments this fiscal year" are examples of objectives. Possible goals for each of these examples may be "a 10.5% reduction" and "2.4% increase," respectively. (In this usage, objectives are differentiated from Juran's quality meaning of "process objective." Juran's "process objectives" should be considered as "goals".)

Common objectives facilitate consensus and provide a focus for action. Objectives also provide a way to measure progress ("If you do not know where you are going, how do you know when or if you got there?"). The wider the participation in setting the objectives, the greater the commitment and motivation to achieve them. Accountability to the objectives' measures is also enhanced.

Applications

• To determine key achievement results desired by the enterprise as a whole in support of the vision and/or mission.
• To determine key achievement results for an individual enterprise change project to measure progress and/or to evaluate accomplishments.
• To facilitate goal setting (see Goal Setting).

Procedures

1. Understand the mission of the enterprise or of the project.
2. Brainstorm desired results and other accomplishments.
3. Develop and document specific objective statements.
4. Ratify objectives (prioritize if required).
5. Reach consensus and obtain approval from the sponsor (as required).

Instructions

When developing objectives for the enterprise as a whole, confirm the mission and/or vision (see Content Analysis). Determine the areas where progress must be tracked and measured, and/or determine the key areas of focus. For example, it is typical to highlight areas regarding customer satisfaction, customer service, productivity, marketplace differentiation, and/or financial measurement areas. With the key stakeholders, brainstorm these areas and develop specific objectives statements (see Stakeholder Analysis, Brainstorming, and SWOT Analysis). A useful set of questions to ask to develop the initial objectives list is to examine "What is the desired outcome?" or "What are we trying to achieve?" The other questions to ask to test for measurement completion include, "How will we know when we have accomplished our objective?" or "What evidence do we need to show that we have achieved what we set out to do?" The vision tests should also provide guidance for uncovering actions that should be linked to specific objectives (see Content Analysis).

Review and reword as required to achieve complete understanding and buy-in (see Focus Groups, Workshops, and Facilitation). Conduct ratification working sessions to gain wider audience participation. Prioritize, finalize, and obtain sponsor approval. (Use an appropriate prioritization technique such as Forced Ranking or Forced Choice Paired Comparison, if there are multiple objectives.) Publish and distribute as necessary.

When developing objectives for an enterprise change project team, also confirm the mission and/or vision of the enterprise. Understand the relationship and role of this change project to the overall enterprise objectives. Set a mission for the project (if required—it is usually helpful), and brainstorm results desired. Project-oriented objectives may be set to:

• develop project deliverables
• Develop expertise in particular areas
• develop teams

Hone the suggestions into specific objectives statements and develop a mechanism to track their progress. (Use the questions highlighted above to help formulate the statements.) Formal documentation helps to clarify the intent and enhance understanding. There should be no ambiguity in project or enterprise objectives.

Ratify and confirm with the sponsor and other key reference groups (e.g., steering committee). It is sometimes useful to prioritize project objectives, using a prioritization matrix. Monitor team member progress towards achieving the objectives based on these priorities.

Objectives should be SMART:

• Specific
• Measurable
• Achievable
• Realistic
• Time-related

Each letter in SMART refers to a different criterion for judging objectives. Different sources use the letters to refer to different things. Alternatives are as follows.

• S -- Specific, Strategic and specific
• M -- Measurable, Motivating
• A -- Achievable, Agreed, Attainable, Action-oriented, Ambitious, Aligned with corporate goals, Achievable, Assignable
• R -- Relevant, Realistic, Resourced, Reasonable, Results-based
• T -- Time-bound, Trackable, Time-based, Time-limited, Time/cost limited, Timely, Time-sensitive, Timeframe

References

1. J. M. Juran. Juran on Quality by Design: The New Steps for Planning Quality into Goods and Services. 1992.
2. Thomas H. Davenport. Process Innovation: Reengineering Work Through Information Technology. HBR Press, 1992.
3. James P. Lewis. Project Planning, Scheduling, and Control: A Hands-On Guide to Bringing Projects In On Time and On Budget. Probus Publishing, 1991.