The Impact of Performance Targets on Behaviour: a Close Look at Sales Force Contexts

CIMA's analysis reviews how it is important that the purpose and effects of performance targets are reviewed in order to address the problems that management professionals are encountering.

High-level targets are needed to stretch staff, but the targets need to be perceived as achievable if the staff are going to accept the stretch.
At present, most organisations use performance targets to influence the behaviour of their employees. The results these organisations obtain are not always the ones expected. There is often disquiet about whether performance targets have the right impact on people’s behaviour and organisational performance. This issue makes managers question the true value of performance targets as a motivational technique. 
  • To be of practical value, performance targets have to be set within a wider framework of the organisation’s performance measurement and incentive system.
  • There are ten common issues associated with the target setting process that undermine its effectiveness. These range from issues with the data being used to set targets, through to the suitability of targets used and the way in which targets are communicated and agreed with sales people.
  • There are three factors that have an impact on the way sales people perceive target difficulty:
  1. Having a clear idea of what their role and performance expectations are.
  2. Having a supportive organisation where risk-taking, continuous learning and improvement are encouraged to promote greater ownership of the targets, which in turn positively affects perceptions about how difficult these targets are.
  3. Being able to participate in the target setting process. 

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