Why is a business vision important? Do you know how to set team objectives?
Business goals and visions are essential for steering your company, but they’re not effective at letting individuals and teams know what to do. Defining realistic yet challenging objectives is crucial when implementing a successful product strategy.
Below, we’ll look at how to use business tools known as Objectives and Key Results (OKRs).
Setting Team Objectives
Objectives should be designed to encourage creative problem-solving while also making clear how progress will be measured. As part of learning how to set team objectives, employees need to know exactly what success should look like.
| Objectives and Key Results: An Overview Andy Grove, then CEO of Intel, developed the concept of OKRs in the 1970s by building on the concept of Management by Objectives (MBO) introduced by Peter F. Drucker in 1954. Grove saw several of MBO’s weaknesses, such as how it motivated employees to take shortcuts and how it failed to align the business’s goals with those of workers. The OKR framework aimed to solve these problems, but it wasn’t until John Doerr introduced OKRs at Google in 1999 that they became widely adopted in the business world. Marty Cagan and Chris Jones don’t go into detail about the OKR concept. In Measure What Matters, John Doerr explains the OKR concept as a goal-setting system in which individual objectives are achieved via measurable sub-goals (known as key results). The major benefits of implementing OKRs are that they clarify your focus by limiting how many objectives you pursue at once, they align all of your business’s efforts by being publicly visible at all times, they enable you to easily track your progress so you can make any changes as needed, and—by making objectives challenging—they stretch your teams’ abilities in a way that lets them aspire to ambitious achievements. |
Cagan and Jones highly recommend using OKRs to define how you measure success. OKRs merge the qualitative nature of objectives with the more quantitative dimension of key results—all while ensuring that success is measured according to those results instead of merely the amount of work done. For example, your objective may be to develop and release a new product feature, while the key results you use to measure your progress might be benchmark dates, such as when the product goes into beta testing. OKRs shouldn’t be set in stone—a healthy back-and-forth between leaders and teams may change objectives or key results to reflect unexpected challenges or happy breakthroughs.
| Complementary Tools for Feedback and Goal-Setting In Measure What Matters, Doerr offers a complementary tool to the OKR system—namely Conversations, Feedback, and Recognition (CFRs). Whereas OKRs address a company’s progress, CFRs are a tool for performance management and promoting a positive company culture. CFRs formalize a system of continual conversations with employees through the year, the constructive use of positive and negative feedback and the frequent recognition of employee contributions. Cagan and Jones touch on all these factors in their discussion of how to coach employees, though not as part of a unified management toolset. You can formalize the back-and-forth goal setting that Cagan and Jones recommend by applying the “one-minute goals” that Ken Blanchard and Spencer Johnson describe in The One-Minute Manager. In this system, you meet with each employee when they take on a new task or responsibility. Working together, you decide on the appropriate goals—the authors suggest no more than three to six—each of which should be defined in less than 250 words. This gives you and each team member concise rubrics to define success and drive accountability, while removing the need for you to monitor your employee’s work too closely—instead, they use the goals you mutually agreed upon to monitor and report on their progress. |
When putting a product strategy into action, leaders should focus on team objectives rather than objectives for managers or employees. By setting objectives at the team level, you give the individual members of a team the freedom to experiment with different approaches. After all, say Cagan and Jones, the people best suited to discover solutions are those who are closest to the problem itself. Allowing teams space for creative problem-solving encourages them to push for the best outcomes, and if at first they don’t meet with the best results, a team empowered by their leader’s respect and guidance will persist until they’re successful.
| The Bottom-Up Approach to OKRs If, as Cagan and Jones suggest, you only set your team’s objectives, then how do individual workers know what to do? In Measure What Matters, Doerr suggests that you let team members set their own objectives and key results. Since this approach saves management’s time, it improves efficiency while allowing employees to remain flexible, which in turn drives innovation. Plus, team members who select their own goals feel more engaged and motivated, which boosts morale overall. Managing this process successfully means setting up a few guidelines. Doerr says team members should create about half of their own objectives and most of their key results. Managers should make sure that employees’ objectives are clearly linked to company priorities. It’s also important that you continually stress the significance of certain high-priority OKRs and promote cross-departmental OKRs to maintain alignment throughout the company. |
