What are good performance targets?

In our private lives, we constantly and usually unconsciously set performance targets for ourselves and others. For example, how we want to play a tennis match, by when the food should be ready or by when the children should have completed their homework. 

Whether we like it or not, we are constantly and unconsciously asking ourselves the price/performance question when it comes to consumption: for ice cream, a hotel room, a computer or a vacation.

Performance targets in the company are targets that are derived from strategic objectives.

As the company’s strategic goals only describe the big steps towards the future, they are only suitable for concrete implementation to a limited extent. In order to make strategic goals (with the help of processes) concretely realizable, “digestible” performance targets (for these processes) are therefore required.

It often makes sense to define several performance targets for strategic objectives and/or certain processes.

For example, the strategic goal “We will achieve the highest level of customer satisfaction in our industry in Switzerland in two years with our Super Duper Children’s Toothpaste product” can only be achieved if:

1. the product quality is significantly improved (in the production process)
2. the sustainability of the product can be clearly demonstrated (in the product design process)
3. these aspects are successfully communicated in the market (in the communication process)
4. customer satisfaction is regularly measured using a generally accepted survey (in the survey process).

Like strategic goals, good performance targets are both ambitious and realistically achievable, even if they require effort.

Good performance targets are ..:

1. Concrete. They express exactly what is to be achieved (e.g. lower failure rate of the product as a quality feature)
2. Measurable (e.g. via customer complaints)
3. Attractive (e.g. especially for customers who use the product professionally)
4. Realistic (e.g. reduction of the failure rate by 7%, which should be possible based on experience)
5. Terminated ( e.g. this 7% increase in market share is to be achieved by the end of the year).