Performance vs Development Goals - What's The Difference?

Sep 07 2021 | Insights
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Performance and development are really two sides to the same organizational coin. Ezra discusses how your business can progress the two in tandem to bring about the greatest results.

Business comes with the duality between the short-term and the long-term. To see the bigger picture, you’ve got to be aware of your own path, and develop appropriate skills. To build effective employees, these two goals need to work together. What are the differences between the two concepts and how can you harness them effectively to improve professional development? 

What are performance goals? 

These are your job responsibilities and the key performance outcomes an employee should strive to achieve. Usually, they are linked to key performance indicators (KPIs), which tie into the responsibilities a company needs to accomplish over the course of the business year. 

In the battle between short and long-term effectiveness of performance goals, they tend to be short-term objectives for specific duties within the employees’ current job position and job description. The goals tend to relate to the company or the department and help the individual know what is expected in their position. Some examples of performance goals are:

  • Increase customer satisfaction by 13 percent by the next quarter. 

  • Reduce expenses by 15 percent by the second quarter. 

  • Increase sales by 20 percent by the end of the next fiscal year. 

  • Create a framework to align with key business goals. 

As you can see, each goal correlates to current goals within the business and also relates to a specific time frame. While there is no hard and fast rule for timescale, especially the latter point about building a framework, performance goals are what an individual wants or needs to achieve. However, according to the Harvard Business Review, just 16 percent of front-line employees actually have a clear understanding of their connection with corporate priorities!

What are the benefits of performance goals?

Goals are vital for peak performance. Studies that show employees who are working towards their goals are more motivated and engaged, which improves business. The key benefits of setting performance goals include the following:

  • Measurability. Having tangible ways to measure progress doesn’t just improve motivation, it’s also a subtle reminder that employees are accountable for their actions. Additionally, it can help your business understand how an employee’s role individually impacts the organization. 

  • Employee well-being. Goal setting can reduce daily workplace stress. Employees are 43 percent less likely to experience burnout when they have a choice in what tasks to do, when they do them, and how much time to spend on each. When employees are bombarded with tasks, goals provide a framework so they can focus better. 

  • Improves decision-making. A clear sense of direction allows employees to feel more equipped to make snap decisions. They can ask themselves if their decisions will help or hinder them from reaching their goals.

What are development goals?

Development goals are geared towards an employee improving their competencies or abilities through training or learning opportunities. A London School of Economics report suggests that firms are addressing skills shortages through the pandemic by recruitment rather than training their employees. 

Professional development and learning go hand in hand and can be achieved through a number of sources, including seminars, coaching, job sharing, and mentoring. The goal is for the employee to expand their skill set or knowledge. Some simple examples of development goals include: 

  • Completing e-learning on unconscious bias by the end of the next quarter. 

  • Take two courses in marketing by the end of the next fiscal year. 

  • Score passing marks on at least three online courses provided by HR.

To achieve their performance goals, employees should always have development goals in place as well. An organization focused on employee development will increase job satisfaction, build morale, and improve motivation, which, in turn, will benefit the company.

What are the benefits of development goals?

Professional development goals are vital to the success and the engagement of the employee, and can yield some of the following benefits:

  • Providing a voice to the employee. Managers can better understand how employees want to grow. It opens the lines of communication and gives the employees a platform to explain their vision, and explore how they want to develop additional skills. 

  • Provides insights into the employee. Employees need to be stretched out of their comfort zone to facilitate growth. When it comes to expanding an employee’s reach, development is the path to success. 

  • Increases employee engagement

    Employees want to feel valued, and recognized for their work. When an employee is given a tailored approach to development, whether personal or professional, this, by proxy, benefits the business.

Man working and calculating.

The key differences

The difference between performance goals and development goals is that performance focuses on the end result, and development goals address the process of gaining the knowledge to meet those performance goals. Developmental goals relate to learning, and performance goals are job-oriented. 

Common characteristics of performance goals

  • Job-oriented. 

  • Geared towards results. 

  • Align with the corporate goals. 

Common features of development goals

  • Skills and/or knowledge-based. 

  • Focused on learning. 

  • Aligns with the performance goals of the individual. 

  • Provides opportunities for career advancement. 

  • Directly supports the current job functions and future needs within the organization.

How do you nurture both effectively?

Companies can either focus on performance goals, professional development goals or can fit both in tandem. Both need to be successful and have to work hand in hand to guarantee employees have knowledge of what constitutes success, while also having the tools to get the results. 

Businesses can struggle to “see the wood for the trees,” when it comes to performance goals and development goals working together. Coaching is a holistic approach to support employees to develop themselves appropriately so they can achieve the performance targets expected of them. 

Bring talent development into the center of your business with Ezra’s world-class employee coaching, built to fit into today’s working life. We’ve redesigned leadership coaching for the modern age to help transform people through affordable, scalable and high-impact solutions, with equitable access through our world-class coaching app. Find out today how digital coaching could make a big difference to your organization.

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