Opinions expressed by Entrepreneur the contributors are theirs.
Now, months into the new year, many of us find ourselves breathing a collective sigh of relief – 2020 is over, Covid-19 vaccinations are underway, and for the first time in a long time there is has hope for a return to (at least some) normality on the horizon. At Punch List, like many businesses, this is a time when, as an organization, we come together, reflect and set goals for the year ahead.
We believe that using the OKR methodology in our business goal setting process benefits everyone at Punch List. Popularized by Google and Intel, OKR, or Objectives and Key Results, is a goal setting and management framework that allows business leaders to guide their team’s progress toward a clear common goal. Here’s an overview of our process with key learnings we’ve found helpful in setting and achieving quarterly and annual business goals.
Related: Keeping It Simple Is Smart When Setting Your Business Goals
Look at examples from the past
Before we even start setting annual goals for our business, we look at examples from our past. What annual objectives have we set for ourselves in 2018? 2019? 2020? And how successful have we been in achieving those goals, measuring our success, and tracking our progress? These are important questions and the answers lend themselves to our future success. Especially for company founders and CEOs, it’s crucial to understand the big picture and how each prior initiative has positively or negatively impacted progress towards the goal, the overall company culture, the strategic alignment and employee engagement.
Let’s take a concrete example to explain my point. One of Punch List’s first goals in 2019 was “Get feedback on the Punch List app alpha” and a few key results were “Onboard [Client Name] to alpha by 8/19” and “Identify list of high friction points and key features needed to launch beta”. Reviewing these 2019 OKRs in 2021 suddenly put our progress in perspective. Instead of just one customer, we’re now expecting dozens, if not hundreds. And, rather than focusing on blockers for launch, we’re instead confirming the rigor of funnel tracking and performance metrics 2019 was all about why the app would fail, while 2021 is all about why/how it will thrive.
Clearly define company and team goals
This one seems obvious, but it’s critical to make sure you’re strategically aligned with your organization’s goals. Talk to your employees and team to determine what each sees as the top priorities for the year. Understanding how your employees view business success and how they see their work and their team supporting that success will help you better define a clear purpose for the business. While we recommend setting corporate goals for the year, team and individual goals should be set on a quarterly basis to support progress toward overall company goals.
Related: Turn Marketing Goals into Wins for Your Business
Promote employee engagement and accountability
The OKR framework encourages focus, accountability, transparency, and alignment in achieving specific, measurable goals. To be successful, you need to keep employees engaged from goal setting through execution. Constantly reflecting on team and individual OKRs will not only drive employee engagement, but will also foster increased accountability as employees are reminded of their value and importance in achieving these goals. Establish regular check-ins with your employees to promote growth, engagement, and ensure strategic alignment with other team members and initiatives. Creating a cultural change within your organization to focus on results rather than outcomes will have a positive impact on employee performance.
Define measurable key results
Setting concrete milestones in the form of key results is fundamental to understanding how successful your strategy is in achieving a given objective. For Punch List, one of the main goals for 2021 is to grow our customer base by raising awareness of our offering to independent contractors – making Punch List a valuable resource for contractors to safely and transparently track the progress of the renovations with the owners and to receive payment. So, some of the key results we will track include growing our customer base by 50% and establishing partnerships with at least three national general contractor associations.
Track the progress of initiatives on a timeline
As you develop your annual and quarterly strategies, write down all initiatives, projects and tasks designed to promote progress towards your key results in a timeline and clearly define the key performance indicators you will track. Set check-in times on a monthly basis to determine the success of each initiative and whether a change in strategy or direction might be needed. Creating a transparent tool to track progress will promote accountability at all levels and reinforce focus on achieving the key objective. All initiatives should support the primary objective and tracking progress is essential to ensure ongoing strategic alignment.
Stay focused on the goals you’ve set for yourself — individually, as teams, and company-wide — and the milestones you all need to hit to get there.
Related: Unless You’re Tracking Your Progress, Goal Setting Is a Waste of Effort