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Wednesday, 13 March 2019 00:00

Target Management in Companies

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While working with several companies in my career as an Employee and as a Consultant,  I have learned that it is very important to ensure  all employees across the Company are having Clear Targets for their work that hour, that day, that week, that Month, that Quarter and that year. As you look at the senior people, the targets for the Three year period too become very important. At each of these levels, the Process for achieving the Targets also has to be clear. 

Shop floor : Here and Now

If you look at the Shop floors of Manufacturing companies, you can understand this aspect very easily. 

If the Shop floor is using Lean concepts and the flow of Material is good, you can see that the target of each Worker is very clear and so is the Process of achieving it. He/She knows what work he/she has to do and how much he/she has to deliver each hour. Hence, the work moves at a brisk pace and production happens. When the work happens without break, the energy levels on the shop floor are really good. The Supervisor is happy the full Production is happening, the Worker is happy he/she has delivered what is expected of him/her. The Quality also in this situation will be at its’ best as there is a rhythm in the working of the whole Shop floor. The same Shop floor looks disorganized and without direction when the Production is getting stopped frequently due to the many reasons that the shops deal with. The Quantity suffers and also the Quality as there is no rhythm.

Recognise the potential ambiguity..

We are able to understand about the work on the Shop floor as the work there is visible and you can see the work happening / not happening clearly. But, the same concept is applicable to ALL the work in a company. The other work that happens in offices is not as clear as the one that happens on the Shop floor. This is the reason there can be more variables with reference to this work that the Staff does. The ambiguity increases as the work moves away from Shop floor. You would have noticed that the work that is done by ‘Strategy Function’ in your company is much more vague than the work that is done in .. say, Material Procurement function.

For your Employee to be Productive, the Target (What) has to be clear and he/she has to be clear about the Process of achieving the Target (How). Without the ‘What’ and ‘How’ being clear, none of the Companies can deliver what is expected. This ‘What’ and ‘How’ have to be clear at ALL levels of the Company. It is not enough if the Head of the Company is clear about his/her vision. This clarity has to go down to the last member in the Company. 

This is quite a simple concept. But, my experience is that these two elements are simply not clear in most of the Companies. Some companies do not have both the ‘What’ and ‘How’. Some may have the ‘What’ in some areas and not in other areas. Most of the Companies would be clear about how much Production has to happen as this is a physical activity visible on the Shop floor. They may not have clear Targets for anything else in the Company. Resultantly, only Production happens regularly. 

Essentials for a good Target based Work Management 

01.  Diagnosis: Every Company should start with understanding their current performance. For a Company having Financial year as Apr-March, they should do this Diagnosis sometime in January of the Year. They should Diagnose in every Function and as a Company, how well they have performed in the Current year. What did they do well and what they did not do well on the basis of data. They should draw out the Lessons from their performance in the past year. One needs to make this a very Structured exercise. 

02.  Fixing the Targets: After understanding the performance of the Company at various levels, the Targets have to be fixed for Various levels starting at the top. The head of the Company has to spell out the Big targets like Top line, Bottom line, Efficiency of various Business aspects etc. The Targets of the Head of the Company should reflect the ambition of the Company and it has to be in line with their Three year plan. 

03.  Cascading the Targets down the Organisation: The Targets have to be deployed to the last level in the Company using the Deployment methodology. The Organizational alignment in terms of Targets is important. We can’t have a situation of every one in the Company achieving their target and still the Company not achieving its’ targets. Usage of Technology is recommended here. A Good Target Deployment Software would be useful. 

04.  Break up the Targets: It is not enough to have Targets for the full year/ Quarter and so on. The Targets have to be broken up to Month / Week / Day. This is where the Quality of Leadership in a Company will be seen. How well can the Leadership help the employees to link the actions of today to the Targets. What should be done today to achieve the Target for the Week / Month etc. This is easy on the Shop floor and regarding Production. But, not very easy with reference to.. say Quality improvement / Cost reduction etc. 

05.  Ensure the Tightness of the Targets: I have seen that the Leaders in many Companies do not pay enough attention to this aspect. They feel their teams already working hard and can’t take big targets. This is a veiled populism and ‘Subsidy mindset’ ! This is one disease that can kill a company as it ensures the whole company under achieves. Teams will be able to achieve more if they are guided well. 

06.  Detail the ‘How’ part: The Targets will not be achieved, if you don’t encourage your team to detail the ‘How’ part. They need to understand the problems that they have in each of the areas and then put a detailed plan of ‘How they will achieve’ the Targets. Every company should spend good amount of time on this aspect. Every minute spent on this aspect is worthwhile. I see that a good number of companies do not pay attention to this and keep aiming at same target every year and failing regularly !! It is not enough for the Leaders to point out a ‘Pie in the Sky’ and leave it there. 

07.  Revisit the Targets every two months: The Target has to be just tight and right to each employee. If the Target is too easy, then the Company will not progress well and if the Target is too tight, the employee concerned will give up and again the Company will not progress well. The Leaders have to look out for this through a detailed process of ‘Target checking’ every two months. They have to be alerted if someone is easily achieving or not achieving at all. 

08.  Bigger Initiatives: Some times to achieve tight Targets in a function, one may have to start bigger Initiatives. Eg. If the Big Cost reduction target has to be achieved in the Company this year, the whole Staff may have to be trained in Cost reduction methodologies.  The Company should have BIG targets in a few areas and launch Broader Initiatives to help Teams to hit them. 

If a Company takes care of the above, then it is preparing the Company to achieve something superlative in the coming year ! 

How is Target Deployment in your company ?  Pl share.


Read 1580 times Last modified on Wednesday, 13 March 2019 16:38

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