Cascading goals is a long-recommended performance management strategy, but what does cascade mean for the organization and its employees?
The dictionary definition of 'cascade' is "a process whereby something, typically information or knowledge, is successively passed on". When it comes to the goals and objectives of a company and its employees, 'cascade' refers to the alignment of these goals across hierarchies. Traditionally this has been done by deriving employee goals from their manager's objectives from the top down, along the reporting lines, but it's far more effective to cascade the organizational goals across business units.
The original idea of cascading objectives sought to align everybody in the company around a common strategy, from the top down. The CEO, CFO and founders began by setting their goals for the company. Senior management then used those goals as a basis for setting their own objectives, and the exercise continued down through middle management all the way to the workers. While in theory this does drive everyone in a common direction, in reality if you focus on the personal goals of each individual it becomes a long game of broken telephone. There are a couple of issues with this strategy:
A better term for cascading objectives is goal alignment. Having a system of flexible objective alignment across business units rather than personal goals allows you to implement those ideas of a unified strategic plan, open communication and personal accountability in a much more dynamic way.
With goal alignment, whether you're using SMART goals or Objectives and Key Results, you still begin with the leadership team deciding the strategic objectives of the business for the next one to three years. These goals are then split up between the departments, org units, and teams that support a specific organizational goal area, rather than through the managerial lines. Objectives are cascaded down through the organizational levels where appropriate, but individuals can also align from the bottom up - meaning they can skip levels and align just to a department goal, or directly to a company objective when that's relevant for them.
There are many benefits of this small change to the idea of cascading goals:
Not all classic performance management techniques are wrong, but just because they're there doesn't mean they don't need updating. Just asking the question, "What does cascade mean?" has led many businesses to make small changes to outdated ideas that really serve to engage employees and boost motivation - exactly what good goal setting is supposed to do.