Magazine article Personnel Journal

Customer Service Drives 360-Degree Goal Setting

Magazine article Personnel Journal

Customer Service Drives 360-Degree Goal Setting

Article excerpt

Companies such as Federal Express and Digital Equipment Corp. are running circles around their employees. But the good news is that by tying individual goals to customer expectations, the employees are more likely to meet their performance standards.

We've heard a lot about 360-degree performance appraisals. But that's not the only practice revolving around the office these days. More and more, companies such as Federal Express and Digital Equipment Corp. are beginning to apply 360-degree goal setting as a natural companion to the appraisal process. This participative method offers a new way for organizations to tie employee goals to customer expectations. Moreover, it holds employees accountable for meeting those performance standards.

The 360-degree goal-setting process differs from the traditional management by objectives used by most companies today. With MBOs, supervisors obtain the subordinate's input about his or her goals. But in reality, the subordinate's feedback is limited because supervisors still assume the primary responsibility for setting goals in the organization. Even when applied correctly, the MBO process sets the employee's and manager's goals apart from the customer's expectations. How do managers and employees really know what the customer wants? In this type of traditional system, an employee is accountable to the manager, rather than the customer. Despite these limitations, most companies still use traditional goal-setting methods even though the competitive pressure to set customer-driven performance standards has increased. But if you take the circular route--as some companies are doing--you're less likely to land back at square one.

External and internal customers drive goals. Similar to the performance appraisal, the 360-degree goal-setting process involves an employee or department and all of one's various internal and external customers. Internal customers may include supervisors, top managers, subordinates, co-workers and representatives from other departments who interact with the employees. External customers may include clients, suppliers, community officials and consultants.

Human resources representatives at Memphis, Tennessee-based Federal Express provide a good example of how this goal-setting system can work with internal customers. At Federal Express, HR has pilot-tested the participative goal-setting process by writing the goals of their customers (the manufacturing department, a supervisor or peer) into an internal customer-service guarantee. The guarantee specifically states what services HR (the supplier) will provide in the next year to a given department (the customer). It includes items such as timely response, 24-hour turnaround for feedback and semi-annual training sessions.

The 360-degree goal-setting process can help break down barriers between departments. In many organizations, departments don't have an in-depth understanding of other departments' roles and objectives. For example, many departments frequently set unrealistic expectations for the HR department. Says Sally Wiggins, a senior human resources representative at Federal Express: "If employees don't see personnel employees doing something, they wonder what you're doing. Clarifying expectations is the key. The employees and managers want to know what you do. What can you do for them?" Similarly, Jay Kirksey, former HR director of Colorado Springs-based Hamilton Standard, adds: "We found there were [differences] in perceptions of what a person should be doing. Joint goal setting provided a much greater understanding of the roles that people play. Involving peers and teams aligned people and established role clarification."

The process also allows for greater input and "two-way communication" between employees and their customers. Service quality experts argue that it's important for companies and their employees to have a precise and in-depth understanding of customer expectations. …

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