Different teams set different goals depending on their industry, company and function within an organization. But few people understand the differences between the types of team goals that exist. And, if you do, it will give you an edge as a leader looking to maximize goal-setting efforts.
“It is important to delineate different team goal types because individuals may have different motivations for participating in team efforts,” says Gergo Vari, CEO of recruitment company Lensa. “People are usually motivated to work towards organizational goals i.e., an increase in market share because they believe it ultimately will benefit the organization; they know that their company wants this, and they want to help achieve it.”
The best goals align individual motivation with organizational targets. Choosing the right ones, and combining different types of goals in your priorities, can help you make the most of your team’s efforts.
Key types of goals for every team
“Within each category, you can set countless goals tailored to your team’s main functions,” he says. “We’ve all talked about S.M.A.R.T goals until we’re blue in the face. But there is a reason why they work so well: People understand how to achieve them. When you set a process, outcome, or learning goal, you know exactly how your progress and the end result should look.”
Ready to brainstorm? Let’s review each of the 3 categories below and learn why it’s important to set all types of goals.
1. Process-based goals
While an outcome-based goal is about what you want to accomplish, a process-based goal is about how you accomplish the work. And it can be particularly useful when you’re aiming to scale your efforts during a period of fast growth or integrate a new workflow in your team.
Plus, ironically, one of the best process-based goals to set is a goal-setting goal, according to Auerswald: “Create a goal system in which you work with your team individually and as a whole on two S.M.A.R.T goals per quarter, and hold [both individual contributors and the team as a whole] accountable to stick with your plans.”
2. Outcome-based goals
Outcome-based goals are all about what you want to accomplish as a team–and they are usually directly tied to business growth. Patrick Dever, the owner of Coupon Ninja, a deals platform, says strong outcome-based goals include objectives around product quality, market share or financials.
Product quality because the more satisfied your customers are with your products, the more likely they are to come back for more. “Reward employees who achieve this goal by making sure they’re taking care of the details before the work gets shipped or shipped out the door,” says Dever.
Market share is about increasing your customer base with existing or new offers or turning existing customers into repeat ones. “The best way to do this is by giving employees the freedom to innovate, but you’ll also want to make sure they’re following up with past customers and optimizing their deals by offering discounts or other incentives.”
Financial goals are self-explanatory, but important to keep a company profitable and create opportunities for everyone involved. Just make sure you don’t only set goals around hard metrics like revenue at the expense of other types of goals that may end up doing more for your team’s overall performance.
3. Learning-based goals
Enter learning-based goals. According to research published in the Ivey Business Journal on the effects of learning goals versus performance goals, learning goals are about the journey and not the destination–and they are incredibly effective at increasing employees’ motivation to pursue the goal.
“Instead of focusing on the end result, a learning goal focuses attention on the discovery of effective strategies to attain and sustain desired results,” wrote the authors, Gary P. Latham and Gerard Seijts.
Setting a performance goal like the outcome-based goals above when your team has yet to master new knowledge can backfire because the stress of meeting the final result makes contributors less likely to invest in mastering the tasks needed to get to that result.
“Those with a learning goal were convinced that they were capable of mastering the task. This suggests that the increase in self-efficacy resulting from a learning goal occurs as a result of the discovery of appropriate strategies for task mastery. A performance goal, on the other hand, can lead to a highly unsystematic ‘mad scramble’ for solutions,” according to the researchers.
If you’re wondering when to introduce learning-based goals in your team, moments of transition such as business pivots are optimal times to do so, especially as your team navigates change and the stressors that inevitably accompany it.