Summary List Placement
Who would have guessed that setting quarterly goals would be so f–king hard?
I’ve been a venture-backed CEO for over 12 years now, so I’ve gotten nearly 50 swings at getting this right. I would say 35 or so of those quarters suffered from bad goal setting. Here is a small sample of things I’ve done wrong:
Set goals too late so quarter is a month over by the time you roll them out
Too many goals
Stretch goals that were never realistic
Goals that are too easy
Goals that can’t be measured easily or the measurement is unclear
Unclear owners of various goals
Here are five lessons I’ve learned that have made this process a lot less painful.
1. Less is more
As CEO, you have a vision of where the company is going. The gap between that future state and the current reality creates a long list of what feels like ultra urgent initiatives. When setting company level OKRs you need to fight the temptation to try to move everything forward at once. It’s not going to work.
I recommend you pick no more than three objectives. If you’re an early-stage company, you’re probably best served by focusing on just one. After a few quarters of consistently hitting your single OKR, you can expand with confidence. What’s the one thing you really need to nail? Focus all of the company’s energy on that.
2. Launching is not an objective
One of the most common mistakes I see startups make (and that I’ve fallen victim to multiple times) is setting a company objective of “launch X new product.” This is backwards. You launch a new product to help you hit a specific objective. Your objective might be “grow revenue.” Your key result might be “50% revenue growth over last quarter.” Launching a new subscription product (for example) is a tactic to hit your key result and achieve your objective.
Growing revenue is what matters here, not the product launch. This is an important distinction because you’ll often find that the product improvements you think are going to change your trajectory often don’t. Losing focus on the results you need to drive is a way for your company to quickly end up in a bad position.
3. The art of picking the right key results
Less is more with key results as well. I never like to have more than two key results for any objective. Most of the time a single key result will do, but a second one can be helpful in keeping the company from doing something dumb . For example, you might have an objective to “grow revenue” with a key result of “50% revenue growth over last quarter.” Adding a second key result of “90% of new revenue being annual subscriptions” will keep the company from chasing “bad” revenue just to hit the goal.
This should go without saying, but your key results should always be quantitative with extremely clear measurement parameters. There should be zero confusion on whether you hit the goal or not.
4. Build a model
After your leadership …read more
Source:: Business Insider