How do you know whether your key employees are really producing? In many small businesses, the owner makes subjective decisions about performance or judge employees only by how well they perform the duties included in their job descriptions. A better way to judge performance is to measure how well employees are meeting objectives that are helping to further the company.

Traditionally people have worked according to job descriptions that list the job activities performed. Consider this example. Your job description for a credit manager may simply say "supervises credit operations for the company." You might get better results from that employee if your set five or six goals for that person. One goal may be to increase credit sales sufficiently to support a 15 percent increase in overall sales within the next 12 months.

Your employees’ objectives should be written down for use as a continuing reference document. Goals should be related to each other and supporting objectives should be noted. For instance, the goals might cover problem-solving, innovation and development. The goals must be time oriented, with specific dates when projects are to be completed and goals to be met. The goals must be measurable. The method for measuring those goals must be clear both for the owners and employees. You want to set your employees up to succeed. Goals should be reasonable and achievable. Nothing discourages employees more than not being able to perform well in their jobs.

Employees should contribute input to the statement of their goals. If they have a role in establishing their own long-range objectives, they have more commitment to achieving those goals. Be sure that such a program of goals and objectives also includes rewards. Employees should be able to see how the company and the employee both benefit from the achievement of goals.

If you would like to discuss goal setting, business planning or employee motivation, contact the SCORE® Association (Service Corps of Retired Executives.) More than 12,000 volunteer business counselors donate their time and expertise to assist entrepreneurs. SCORE® is a nonprofit organization and all counseling and business mentoring are provided as a free and confidential community service. For a referral to the SCORE® chapter nearest you, call 1 (800) 634-0245.