Satisfying your organisation's burning ambitions

There will be thousands of people involved in next month's Olympics in Beijing. While the vast majority of them will have a strong overriding objective in mind, these objectives will all differ tremendously. For instance, the organisers will be hoping for a smoothly organised event that will showcase China to the world. On the sports field, a select few of the athletes involved will have their eyes fixed firmly on a gold medal. Some may be striving to reach the podium or just to make it to the final stages of their event. And, others will simply be trying to stay in the competition as long as they can. No matter exactly what their objective is, for everyone involved in this prestigious event, their Olympic fortnight will be dominated and defined by striving to reach their goals.

With goal setting playing such a major role in two of the most exciting weeks in China's recent history, I thought it wise to explore the power of goal setting and the ways in which it can aid all of us. Specifically, I want to explore the idea of Management By Objective and how it can have a massive effect on your organisation.

First outlined by management guru Peter Drucker in his 1954 book ‘The Practice of Management', MBO focuses on improving an organisation's performance by aligning the objectives of individual employees with those of the entire organisation. The underlying principal supporting MBO is that everyone within an organisation must have a clear understanding of the aims and objectives of that organisation. However, they must also understand how their own individual objectives contribute to the success of their organisation.

On a strategic level, MBO can certainly have a major impact upon your company. A recent example of MBO in action would be its application by US computing giant Intel. Back in the 1980s, Intel was facing fierce competition from emerging Japanese competitors and was in danger of losing much of the market it had created. However, CEO and co-founder Andy Grove (whose book Swimming Across we featured in our January edition) introduced MBO as a way to keep Intel focused and his whole team working together to achieve their primary goals. This had such a fantastic influence on Intel that by the late 1980's and the end of Grove's tenure, it was again on top of its field.

No one can dispute the vitality of MBO as a strategic tool. Many prestigious business authors, such as Mr. Grove, have discussed its power in greater detail than the confines of Network HR will allow. Rather than simply rehashing their old ideas, I want to look at MBO in two different ways. First, I want to discuss the impact it can have on Human Resources. Second, as this is our Olympic edition, I want to cast a sporting analogy to show how MBO can work and the influence it can have upon your corporate culture.

Engagement

A key principle behind MBO is that everyone within an organisation should not only understand their goal, but also accept and embrace it. This means that management cannot just dictate what your employees should do and how they should do it. Simply issuing orders may well get everyone in your team pulling in the right direction, but it is debateable how much energy and dedication they would invest in the cause.

Successful MBO models suggest that managers discuss objectives with their team on two levels. First, they clearly outline their organisational goals, informing employees exactly where their company is going and how they plan to get there. Then, they discuss individually the role that each employee must play in helping the organisation move forward. From this, the employee and management set objectives that will allow the employee to be as effective as possible in achieving the organisation's goals.

"So", you cry, "how does that impact upon engagement?" MBO impacts engagement in two critical applications of Human Resources. First, by highlighting your strategic goals and clearly mapping out the direction in which your organisation is headed, you keep everyone informed and up to date, which will definitely nurture a feeling of involvement. Second, by actively involving employees in the goal setting process, you show you value their ideas and their opinions, and you understand the vital role they have to play in your organisation's future. Some organisations take these ideas even further. By setting goals without giving further instructions on how their employees should achieve those goals, they tell their employees that they trust their judgement and are happy for them to leave their footprint on the organisation.

Motivation

Another key issue in MBO is motivation. Astutely set goals will work to keep your employees focused and striving to meet their targets. One of the most common techniques in setting goals as part of an MBO system is S.M.A.R.T goals (Specific, Measurable, Achievable, Realistic, Time-Bound). Whilst all five parts of this acronym are crucial to setting objectives, it is the ‘A' and the ‘R', which can motivate and inspire your staff.

By setting goals that are challenging but ultimately attainable, you give your employees a target they can strive for. When they achieve these goals they will feel satisfied and will see their value to your organisation. However, if you set goals that aim too low or are simply out of reach, you run the risk of demotivating your team. For example, if the goals you set are simple and do not challenge your team, they will become bored. If they are too high, they will feel as though they are fighting a losing battle and have no chance to succeed.

I like to compare this situation to climbing mountains, which admittedly is not an Olympic sport, but the analogy works well. Let's imagine the goals we are about to set are mountains. For instance, by aiming low, you are setting the goal equivalent of Panshan Mountain, close to Beijing. At just under 1,000m in height, it is possible to climb Panshan in a few hours. Upon reaching the summit, of course the views are great and your team will feel satisfied, but they will sense that they could have accomplished more. If you aim too high, you have put Mount Everest in front of your team. They have the challenge, but their chances of reaching the top are slim and they will begin to feel seriously discouraged.

Olympic Example

In the spirit of the Olympics, I would now like to cast a sporting analogy to MBO. Cast your mind back to the last Olympics in Athens in 2004. Liu Xiang's record breaking, gold medal winning exploits in the 110m hurdles notwithstanding, one of the most enduring memories for Chinese sports fans was the triumph of the women's volleyball team. China captured gold with a dramatic come from behind victory against Russia in a marathon battle. By fighting back from two sets down, the Chinese team not only provided fantastic entertainment for a global audience, but they also demonstrated the power of teamwork and gave us a fantastic example of how MBO can work on many different levels.

A volleyball team features six players, all striving towards their main objectives of scoring 21 points to win each set and capturing three sets to win each match. This is analogous to your organisation's major strategic objectives. However, within each team, the different players have different objectives that they must work towards in order for the team to succeed. This is the same as your employees driving your organisation towards your strategic objectives.

Let's look at this in a little more detail by examining the various roles in the volleyball team. Liberos, who play in the rear, have primarily defensive responsibilities. These players need to have fast reactions and the best passing skills in the team. Because of these requirements they do not need to be tall, but certainly must move quickly around the court. Setters, who work the centre of the court, are the creative engines within the team, orchestrating attacks. To do this they need to be fast and also tactically aware. The remaining players on the team fall into the category of hitters and play the net, working as the team's offensive heart. There are two types of hitters, middle hitters are usually the team's tallest players who specialise blocking at the net and finishing off fast attacks. Often middle hitters bring height and power, but are slightly less skilful. Outside hitters need a slightly more three dimensional skill set. They are responsible for scoring points, but also need to operate defensively and pass the ball.

The players who fulfil these specific roles each know exactly what is needed of them. They know the team's overall objective and they know the role they need to play in order for the team to achieve that objective. The contrast between Russia and China in the gold medal match, demonstrated clearly why understanding objectives is so important. Whilst the Europeans relied heavily on their two star attackers Ekaterina Gamova and Lioubov Shashkova, China relied on a far more well-rounded group of talent. Each of the Chinese players knew their specific role and how they contributed to the team's overall performance and success. In fact, three separate Chinese players were chosen as the tournament's MVPs for their respective roles - Zhang Ping was voted ‘Best Spiker', Feng Kun ‘Best Setter', and Zhang Na ‘Best Receiver'.

Olympic Organisations

The Chinese volleyball team will again be aiming for gold when they compete on home soil next month. You can feel confident that their coaches will ensure every member of the team knows exactly what they need to do to bring victory. In short, they will be managing by objective. Although I am sure your organisation is bigger and far more complex than a six-person volleyball team, adopting a similar approach will help you keep your employees engaged, motivated and focused on achieving your organisational goals.