By not defining them, you leave the priorities of the business up to what amounts to a popularity contest with each manager. Raises and promotions thus get handed out to the people who are most likable.
Senior executives (usually VP and above) at major companies typically sign contracts explicitly outlining their goals for the next 12-24 months. They are incentivized or fired based on meeting those goals. And it’s the executives who demand this, not the companies.
Point being, if the executives are demanding clear performance goals for themselves, it’s probably good practice. Managers typically are not responsive to demands from below, so guess where the mandate has to come from.
