If you want individuals and teams to row with strength and coordination, ensure they know their boat’s next destination. This next destination is not the fuzzy promised land over the horizon, it’s the port directly within sight. The point of company-wide objectives is to provide context for how everyone fits and contributes, and to drive greater cross-functional communication and support.
There are several effective methods for setting and driving accountability around company objectives. We are fans of both the Entrepreneurial Operating System (EOS) and the Objectives and Key Results (OKR) methodology. In each case you can start with your senior team, but eventually the process should cascade down the organization at all levels (company, departments, teams and individuals).
The OKR Methodology
Best practices for setting objectives:
A couple good examples of company-wide OKRs:
For more on OKRs, we suggest the original text: Measure What Matters.
The EOS Model
In a nutshell, EOS is a management system that helps align and synchronize all the pieces of your business to produce the concrete results you want. The system is designed around 6 key components (Vision, People, Data, Issues, Process and Traction) to unite leadership around where the company is going and specifically how it will get there, including who plays what role, repeatable processes and data backed accountability.
If implemented effectively, EOS will produce a healthier and more productive leadership team, surface and crush issues quicker and ultimately, accelerate results for the business.
EOS Implementers follow a Proven Process to guide a leadership team along the journey, strengthening the 6 Key Components. Along the journey, the leadership team learns to master simple tools designed to help build trust and clarify the issues blocking their Vision (including issues within the leadership team) and then knock those issues down one quarter at time.
DIY vs. using a coach:
The most reliable approach to implementing EOS or the OKR system is to hire an outside coach. But for those tight on cash (e.g. seed stage companies), there is the DIY alternative which is still worthwhile.
While not as well known as OKRs and EOS, especially among technology startups, Rockefeller Habits is another fairly established system. Kickstarted by Verne Harnish’s 1999 book, Mastering the Rockefeller Habits and since codified into a planning and implementation methodology called Scaling Up, Rockefeller Habits outlines three fundamental habits key to successful business management: priorities, data and rhythm. Since the publication of Harnish’s book, many leadership teams have adopted the One Page Strategic Plan (OPSP) and corresponding planning frameworks as their foundation for generating accretive growth.
A note on BHAGs:
Though terminology differs, most systems involve visualizing a future state and working backward from there. Instituting a “big hairy audacious goal” (BHAG) is maybe the simplest distillation of this concept. We at Vocap are fans of using BHAGs. When used effectively, a BHAG will cut through the clutter, rally the team and keep everyone’s eyes on the prize. A good BHAG should be simple and easy to understand, such as “the march toward X” with X being some ambitious, measurable achievement. YouTube’s “billion-hour mission” is a great example:
OKRs, EOS and Rockefeller Habits are just a few of the more proven methodologies. Regardless of the specific system you choose, you will do well to incorporate the basic principles outlined above.