(bright music) Setting the right goals depends on the needs of a team or individual. In the following lessons, you'll learn how to use performance management methods, employee buy-in, and a scaffolding approach to encourage goal completion. Formal and informal performance reviews are two different approaches to measure an employee's performance and compare this to their individual goals or team goals. A formal approach involves a scheduled, systematic review of employees. Usually this approach utilizes a company approved system to analyze the employee's performance. The system is based on the expectations of the employee's job description and is often facilitated by the human resources department. It may utilize an outsourced system or internal system to manage the process of employee evaluation. An informal approach involves a conversation or a coaching session when appropriate. For example, some managers may do an informal check-in with their employees when productivity slows or when an employee is facing challenges. When conducting informal performance reviews, it's important to be encouraging and avoid overwhelming employees with questions or advice. This can turn into micromanaging, which is a controlling management style that can have a negative impact on employees. If employees are lacking the knowledge or tools to be successful, then managers can generate professional development by recommending training or conferences according to the employee's improvement needs. So how does performance management relate to goal setting? In many ways, goal setting shows how an employee's performance is reviewed. Employee performance is measured based on the goals that have been set by the employer. If an employee is not meeting expectations, then a manager can implement a performance improvement process to help them overcome challenges and meet their goals. When you think of performance management, you can imagine it as a series of steps. In the first step you can monitor employee progress through informal check-in meetings. In the second step, you can review employee expectations and establish goals that are specific, measurable, attainable, realistic, and time-bound. Then you can determine what kinds of rewards you might offer an employee for meeting expectations. By following these steps and introducing a formal performance review system, you can prepare employees to reach individual goals and achieve success in your organization. To improve your performance management strategy, ensure that employee goals are connected to team goals and that both employee and team goals support the overall strategic plan of the organization.