CoolSoftware wasn’t hitting their revenue targets. The sales team felt dejected. So why was the
Each sales rep dealt with the lack of quality leads differently. Some used their network to try selling to old contacts. Others compiled email lists for marketing to load into the CRM system.
The marketing team didn't like getting lists from sales reps to load into the CRM. Lead quality was dubious and many of these leads were already in the system. The marketing VP got a round of applause when he said, “Why don’t those sales reps go out and start selling instead of trying to do our job for us!”
To their credit, the marketing team worked hard. They had a coherent set of goals with measurable results such as increasing traffic to the website, improving landing page conversions to download the company brochures, and increasing the number of subscribers to their blog. However, the marketing team was working on the wrong goals!
Senior marketing and sales leaders didn’t get on the same page to define and align their objectives with measurable key results. Effort was wasted. If one team celebrates while another is dejected, your company may not be well aligned.
Leading companies such as Intel, Google, and LinkedIn have solved this problem — by using Objectives and Key Results (OKRs).
Definition: Objectives and Key Results (OKRs)
OKRs consist of 1) Objectives and 2) Key Results.
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Objective: Statement of a broad goal that is generally not measurable
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Key Result: Statement of a measurable goal that defines achievement of an objective
It’s easy to come up with objectives. It’s hard to define key results. In a typical meeting, the outcome might be, “We all agree that we need to increase demand in our solution.” This statement can easily be written as an objective, “Increase demand in our solution,” but how will we know if we’ve achieved this objective? This book focuses on best practice approaches and questions we need to ask in order to clearly define the objective's underlying key results as well as ongoing tools that can be used to ensure we maintain the discipline of OKRs.
Definition: Alignment
Alignment is the extent to which the strategy and
If we’re making progress moving up ladders that are not declared “strategic” by executives, our company is not really aligned; we have a busy-but-not-productive problem. CoolSoftware had this problem. We're making progress increasing the lead score metric, but the VP Sales does not consider this strategic.
Is Your Work Aligned?
As a mid-level manager of a Business Intelligence (BI) team at planetrx.com, a mid-sized company, I once had that something-seems-off feeling and it seemed my work was disconnected from strategy. Our BI team sent out semi-automated, daily flash reports to all executives and managers. After a few weeks of getting these emails, I noticed that most recipients deleted the daily email and treated it more or less as SPAM, yet the BI team continued to put in hours each week maintaining these reports. Finally, I decided to stop sending these reports to test how my internal audience would respond. No one complained that the reports were phased out! We were busy working on stuff that didn’t matter! I'm not alone. Research indicates that as many as 60% of highly engaged employees feel their work is not aligned with the company's strategic goals.
Are you updating and sending out reports that don’t lead to action? OKRs gives
Why OKRs took off in 2013?
Google started using OKRs in the 1990s, back when they had just 40 employees. In May of 2013, Google Ventures partner Rick Klau gave a one-hour, 20-minute presentation on how OKRs work. It’s an amazing presentation that I forward to anyone interested in learning about OKRs.
Klau's tweet indicates he is surprised by the exploding interest in OKRs and his workshop video:
@klau tweet: "My OKRs video just passed 150,000 views. That's about 149k more than I thought it'd get"
However, as more and more Xooglers take leadership positions and the next generation of CEOs view Klau's workshop, it's no surprise that OKRs are gaining traction. The OKRs methodology is taking off outside the US and with companies of all sizes. One study suggests 40% of tech start-ups in London recently switched to OKRs!