How to set ambitious business goals and achieve them

2024 Author: Malcolm Clapton | [email protected]. Last modified: 2023-12-17 03:44

Apply the expertise of Google and Intel to your company.

“Is my business developing in the right direction? Am I setting the right goals? - such questions are asked by entrepreneurs at different stages of their own business development. One of the tools that will help make the company's progress systematic can be OKRs (Objectives and Key Results) - a goal setting system developed by Intel.

Its key difference from others is flexibility. Many companies plan to work a year in advance, and this usually ends with hopeless obsolescence of the plan. OKRs follow an agile ideology in which goals and results are regularly reviewed. This usually happens once a quarter, but many companies adapt the system to suit themselves and additionally implement weekly and annual OKRs.

The system owes its popularity to former Intel employee and venture capitalist John Doerr. Today this method is used in many well-known IT companies, including Google, LinkedIn, Twitter and others.

To start working on OKR, you need:

1. Start training employees 3-4 months before the transition to the new planning system, so that it goes through easier. Host meetings, webinars, suggest relevant literature, and try to implement OKRs at the corporate level.
2. Formulate goals.
3. Determine the results.
4. Monitor the implementation and adjust the goals.

How to formulate goals

Goals in an OKR system are a memorable and concise description of what you want to achieve. Their main purpose is to challenge a team or company.

Another distinguishing feature of the OCD system is who sets goals and results. Unlike KPIs, which are usually set by management, OKRs can be shaped by the performers themselves. This encourages more initiative and involvement in the company's affairs from the rank and file.

In addition, goals must meet some important criteria.

1. Ambition

It is important to maintain a balance here: the goal should be achievable, but not too simple. Imagine what you could do to the limit. This will be a great goal.

Bad target	Good target
Create a calculator app	Create a voice-controlled AI calculator app

2. Finiteness and clarity

It's simple: the end point to be reached must be determined. Try to make the goal an independent combat unit, a slogan that does not need an explanation.

Bad target	Good target
Improve the site	Speed up website loading

Ambiguous language can lead to conflicts with the goals of other employees. For example, team A wants to update the UX of the site: remove outdated elements, change colors and buttons. Team B wants to optimize the site and increase the loading speed. In doing so, both used the vague wording "Improve the site", although by this they mean completely different actions. To avoid inconsistency, team A should set the goal of "Improve the site's UX", and team B - "Speed up site loading."

3. Brevity

There shouldn't be many goals. If it's a small startup with five people, one is enough. For example, “Build an AI calculator app and be one of the top sellers on Google Play” is not a good goal. The best choice would be to focus on launching the product (“Build an AI calculator app”) and then focus on promoting it in the coming quarters.

And even in the case of a large company with a complex structure, try not to create an additional goal once again. If there are too many of them, then it will take a lot of time to synchronize between departments and find out who is doing what.

How to formulate results

Once you have your goals set, you can take on the results. If the goals motivate and indicate the general direction of work, then the results should be as specific and measurable as possible. These are working tools and metrics.

Moderation is also important with them: each goal can have up to five results. Otherwise, you will be wasting your efforts. For example, you have an online store and you want to improve your email newsletter with suggestions to your users. You set an ambitious goal "To make the most profitable mailing list on the Russian Internet." In this case, the results will be as follows:

1. Increase the open rate up to 70%.
2. Increase sales from each mailing up to 20,000 rubles.
3. Increase the number of purchases in each mailing list to 50.
4. Win the "Most Profitable Runet Mailing List" competition.

Key results also have several important criteria to consider.

1. Measurability

No numbers - no result! If abstract constructions are still possible when drawing up goals, then when forming results this is unacceptable.

Bad result	Good result
Increase website traffic	Increase organic traffic to 1,000 users per day

2. Verifiability

The result must first of all be achievable. If you can't say with confidence that at one moment you achieved what you wanted, then there is no point in setting such a result.

Bad result	Good result
Increase customer loyalty	Increase Net Promoter Score by X%

3. Compactness

One result, one metric. If you try to put everything in the world into the wording, it will not lead to anything good.

Bad result	Good result
Increase the number of registered users, reduce the number of returns and increase loyalty	Reduce the number of returns by X%

How to track OKR progress

The results are tracked at short meetings - check-in. They are held weekly or monthly and last about 30 minutes, depending on the tasks set and the specifics of the business.

There are many different formats for these meetings. You can meet with employees in person if everyone is in the same city, or organize a video conference via Skype or Google Hangouts. However, any check-in follows roughly the same formula:

1. Progress report. How the OKRs have changed since the start or the last check-in.
2. Confidence in achievement. Employees give an approximate forecast of whether they will be able to achieve the stated results.
3. Obstacles. External and internal factors that slow down or can slow down the execution of OKRs.
4. Initiatives. What actions the team can take to speed up or facilitate the achievement of results.

At the end of the quarter, a final check-in-meeting is held: each team reports on the results and evaluates successes and failures. OKRs are philosophically ambitious, so achieving 70% goals is considered successful. If an employee or department completed the assigned tasks 100%, then most likely they were too simple. Therefore, when planning for a new quarter, the bar should be raised significantly.

In addition, if one of the key results is not met, the goal is not considered achieved.

Output

OKRs are a great tool to help businesses organize and synchronize processes. Although popularized by IT giants such as Intel and Google, no one forbids using the method in non-tech companies.

But you shouldn't treat OKRs like a magic wand, with a wave of which everything will work out by itself. Rather, it is a professional drill or an expensive electric screwdriver that only works as it should in skilled hands. Success in using the system depends on how you communicate it to employees and implement it in the organization.

To make your OKR work more convenient, you can also use:

• special template for "Google Sheets";
• the Coda service, which we wrote about recently;
• Trello project management application.

Also, if you are interested in this topic, you can read the book "Measure the Most Important" by John Doerr, and also watch the Google webinar.