How Cascading Goals Can Transform Your Company Culture: Insights for HR Leaders

by Srikant Chellappa Oct 15,2024
Engagedly
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with Srikant Chellappa, CEO

The long-term success of any organization largely depends on purposefully determining objectives and setting company-wide goals that can demarcate success from failure. A recent research found that people who set goals are 43% more likely to achieve them. Likewise, employees who set goals are 14.2× more likely to be inspired at work.

Nonetheless, the concept of goal setting has been quite complex for most organizations in terms of executing it successfully and consistently over time.

This is when the need for cascading goals comes up.

Goal cascading is a strategy that assists organizations in creating unified goals for all levels within their organizational structure. This enables people to achieve various predetermined goals in different and complementary ways, and these individual efforts will eventually bring the company’s vision and goals closer to reality.

Keep scrolling to learn about cascading goals in more detail, their benefits, and their role in transforming the overall company culture. The blog also discusses different ways to implement cascading goals to help team members effectively contribute to goals and objectives.

Understanding Cascading Goals

Cascading goals refers to a structured strategy where larger organizational goals are broken down and distributed across various levels within a company. They begin with the top-tier objectives and flow down to the specific or individual tasks that each employee works on.

Cascading Goals flow

The fundamental benefit of cascading company goals is the potential formation of a common vision, shared purpose, and focus which unifies members of the organization.

For instance, an organization may have the corporate objective of increasing client retention, and many departments such as the sales department, customer success department, etc. can play a part in realizing such objectives. This emphasizes on a cascaded goal where every department focuses on the same objective which is to retain a client.

Put simply, cascading goals are a graded framework that helps you break down goals as per the hierarchical structure of an organization. The goals in the process are set at the highest level, and then they cascade throughout the organization in clear and actionable steps and deliverables.

What is the Importance of Cascading Goals?

Goal cascading is important for an organization’s goal management initiatives for several different reasons, including:

  • When setting a cascading goal, a team member or employee can strive hard to accomplish it.
  • The process of goal cascading can help boost the community within an organization.
  • The cascading of goals helps improve employee morale.

The main objective of the goal cascading process is to get a clear understanding of the organizational goal, starting from the top to the bottom management.

This helps management to gain a clear idea of what is going to happen when the strategy gets broken down into clear and attainable deliverables, to make communication and tracking easy within an organization.

Types of Cascading Goals

There are four types of cascading goals that organizations can work upon, such as:

1. SMART  (Specific, Measurable, Achievable, Relevant, and Time-Bound) Goals

SMART Goals: Integrating Employee Experience

SMART goals provide a well-structured framework for creating and achieving objectives at different levels of hierarchies within an organization.

2. BHAGs (Big Hairy Audacious Goals)

BHAG

Source

BHAGs are more ambitious, long-term organizational goals that lead to both systematic progress and innovation in the organization. These goals are mainly designed to guide an organization in the right direction of achieving the long-term goals.

3. OKRs (Objectives and Key Results)

OKRs are a goal-setting framework that helps organizations to build a well-understood system of well-defined and measurable targets and outcomes.

Top OKR software tool offers a great way for goal-setting which allows employees to execute individual as well as company objectives effectievely.

4. V2MOMs (Vision, Values, Methods, Obstacles, and Measurements)

V2MOMs refers to a popular and comprehensive goal-setting approach that includes various elements such as values, vision, methods, obstacles, and measurements. It offers a comprehensive and well-rounded approach to aligning organizational goals with individual goals.

Examples of Cascading Goals

Here are some of the examples of cascading goals to help you understand the concept better:

1. Sales Team

The specific objectives of a sales team in a software company, focusing on both acquiring new customers and retaining existing clients, are closely tied to the company’s main goal of boosting its market share by a set percentage (for example, 10%) during the fiscal year.

Every team member or sales representative is aware of how their contributions impact the company’s overall growth, fostering a sense of strategic alignment.

2. Product Development Team

The product development team’s objectives in a technology or software organization stem from the broader company mission of launching a set number of innovative products each year.

Every team member is assigned a specific goal that, when combined, helps reach this overall objective, ensuring that the entire team is aligned and working together towards a common aim.

How Cascading Goals Help Transform Company Culture

Well-translated and properly executed cascaded goals keep everyone in order, thus allowing individual efforts to show up collaboratively to make progress toward final objectives even faster.

There are several benefits of cascading goals for transforming an organization’s culture, including:

1. Develop a Higher Sense of Purpose 

The cascading goal is an excellent technique that takes care of a shared direction and improves strategic alignment across the entire organization. Employees become more attached to and willing to perform a particular task when they see its positive contribution to the overall business results that would otherwise seem far-flung from them.

2. Enhanced Employee Engagement

Higher employee engagement is directly proportional to a productive workplace and goal cascading can be an excellent way to achieve this. Data also show that companies with a highly engaged workforce have 21% higher profitability and employees here are better equipped to collaborate with peers and managers to set performance goals.

Besides, cascading goals help employees and managers align the set goals with larger company-wide objectives, which further increases engagement.

3. Build a Unified Vision

In addition to being a remarkable management mechanism, cascading goals can also be considered an excellent unifying tool for any organization. In this situation, the higher-level organization’s goal or objective is broken down into smaller, more precise, and manageable tasks at different levels, in which each individual knows exactly how his/her work fits into the overall purpose.

This kind of strategic alignment inspires employees and helps them appreciate the relevance of their work toward the success of the organization.

Common objectives enhance cohesion among the members of an organization leading to a number of advantages for the creation of a positive organizational culture such as increased efficiency as everyone is working collectively towards achieving a common objective.

4. Empower the Workforce Through Clarity and Communication

One more positive point of cascading goals is their provision for growth in the clarity and transparency of internal communication.

Management should be properly executed so that it is kept between the higher-ups and the subordinates. Such qualities as openness, innovation, and continuous performance management are enhanced as the goals are communicated throughout every business unit.

This is also a way for the employees to be more skilled and enabled as they see the big picture. It could also facilitate greater productivity and/or happiness in their job and a reduction in turnover rates by building a company culture of which every member of the organization is also a part of. This will, in turn, enable employees to invest in organizational success through both personal and group efforts.

5. Bring Flexibility and Adaptability

Having a clear and well-defined set of cascading goals offers clear direction for employees and teams at every level. This means that even when external working conditions change or organizations achieve their goals, they are better equipped to pivot toward new ones.

Goal cascading empowers each team and individual to be more flexible and adaptable so that they can modify their goals by taking a reference from the one set by the team above them in the hierarchy.

Likewise, cascading goals also bolster accountability in the organization. This can be done by both teams and individuals regularly by reporting back to those who depend on their efforts.

The best way to do this is through weekly or daily team check-ins, where each individual can share updates on their respective work. If they find that they are not in line with reaching their set KPIs, they can collectively work with their peers or managers to overcome any challenges efficiently.

How to Implement Cascading Goals

Implementation of cascading goals in an organization is an ongoing process and should be revisited often. Here’s how you can implement cascading goals in a simple stepwise process.

Step 1: Thoroughly Review the Company Mission and Set Long-term Goals

The first step in the process before you even think about setting goals, is to consider the vision and mission of the organization, which may not be clear for employees at large organizations.

The mission and values of the company should always guide the work you do. Developing a clear understanding of a company’s values and mission allows you to create achievable goals that help you move your business forward.

Additionally, it is important to ensure that your employees understand the business objectives clearly which makes them better at the jobs that they do and more in tune with the organizational needs.

Step 2: Create Departmental and Team Goals

To set goals at the department or team level, make sure to discuss potential goals as a group. This will help you build investment in achieving them while also taking advantage of individual team members’ insights on how to use their respective talents to support company goals.

You can do this by discussing the organization’s strategic goals followed by brainstorming ideas.

Step 3: Set and Align Individual Goals

When setting a cascading strategy, the decisions don’t stop at the departmental level. It further drills down to teams and individual levels. This helps employees gain a deeper understanding of the organization’s vision and top priorities as the plans go down the hierarchy.

This kind of strategic alignment imparts a higher sense of purpose, highlighting the impact of each employee’s contribution at the organizational level.

Step 4: Use Goals in Daily Communication

‍As soon as all teams and individuals have set their goals and objectives based on the cascaded goals strategy, it is critical to keep a check on their progress as a part of a continuous goal management cycle.

Instead of simply conducting weekly or bi-weekly goal check-ins with their team members, managers also need to discuss the respective goals in daily communication such as as performance management plans, and keep note of milestones as and when achieved to keep employees motivated.

Step 5: Track the Progress of Goals

The next step in the process is establishing Key Performance Indicators (KPIs) that help you quantify the progress of each of the set goals. It is important to keep in mind here that ambitious yet attainable targets should be the priority to keep employees motivated and to drive teams to their performance management goals better.

Apart from this, tracking goal progress regularly ensures higher accountability and offers excellent opportunities for making changes/ corrections mid-way.

The key advantage of this kind of data-driven approach is that it converts the goal-cascading strategy into a more adaptive journey, thus fostering a culture of collaboration among teams and continuous workflow improvement.

To Conclude

If implemented properly, goal cascading can help increase strategic alignment, thus fostering a culture of better collaboration, greater transparency, and improved employee engagement.

However, if you do not revisit the goals to incorporate upward feedback or only set them annually, then cascading goals can be ineffective or frustrating in the long run.

A robust goal-setting software such as Engagedly can help you navigate this by allowing you to both create goals and letting you manage and track them easily.

Using Engagedly’s goal-setting software, you can manage employee goals effectively throughout the organization. The best part about Engagedly is its cascading feature that allows adding individual contributors or stakeholders to each goal.

 

FAQs

1. What is the cascade approach to organizational goal setting?

Cascading goals refer to the organizational goals that are established first at the highest level of the organization. This is followed by supporting goals created for each team and individual within the organization.

2. What is the purpose of cascading goals?

The main purpose of goal cascading is to set strategic business goals at the highest level and ensure that those goals cascade down throughout the organization to help guide team and individual-level goals.

3. What is an example of a goal cascading?

In an organizational context, a cascaded goal could be a company’s larger or overarching objective of increasing revenue. This goal can be cascaded down to the other departments such as sales or marketing with a specific target to achieve a specific percentage growth in sales within a defined period.

4. What are the three KPI cascade methods?

The top three KPI cascade methods include:

  • Top-Down Approach: In this approach, objectives or goals flow from top management to lower levels, thus ensuring complete alignment with strategic objectives.
  • Bottom-Up Approach: This is the approach where employees contribute to goal-setting, thus allowing better and deeper insights from frontline workers to inform higher-level objectives.
  • Hybrid Approach: A hybrid approach is one that combines elements of both top-down and bottom-up methods for a more balanced approach, thus promoting better organizational alignment and higher employee engagement

5. What should be the frequency of reviewing the cascaded goals?

Cascaded goals should be reviewed regularly to assess progress and make adjustments as required. Depending on the organization or business, this can range from quarterly and half-yearly reviews to more frequent evaluations.

6. Do cascading goals need to be adapted in response to market changes?

Yes, cascading goals should be adaptable to market changes as flexibility is key to ensure that these goals remain relevant and attainable, especially in dynamic business environments.

Author
Srikant Chellappa
CEO & Co-Founder of Engagedly

Srikant Chellappa is the Co-Founder and CEO at Engagedly and is a passionate entrepreneur and people leader. He is an author, producer/director of 6 feature films, a music album with his band Manchester Underground, and is the host of The People Strategy Leaders Podcast. He is currently working on his next book, Ikigai at the Workplace, which is slated for release in the fall of 2024.

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