Organizational Goal Setting

Rory Eakin -

Organizations exist because a collective of people is more creative, productive and efficient than a single person when pursuing complex long term objectives. Having a diverse set of talent, perspective, and ambition allows organizations to sub-divide broad goals into distinct work plans optimized for specific individuals at specific times in their professional careers.  How well an organization accomplishes this singular task is one of the most important roles of organizational leadership.  

How should goals and tasks be set and communicated in an emerging company?

At CircleUp, we used OKRs. Every new employee watched this video from Google Ventures about the OKR process.  We struggled with OKRs but stayed with it, and I recommend it today.  To paraphrase Churchill, OKRs are the worst planning tool for organizational goal setting, except for all others.

OKRs optimize for transparency and clarity across the organization.  We had a single Google sheet, with tabs for each quarter, that showed new and old employees the entire history of our company goals. Each sheet listed the 3-5 goals set by each area of the company (product, sales, operations, executive team) at the start of the quarter, and the result at the end.  Quantifying the result clarifies the goal for all.  We held quarterly open invite meetings to discuss these goals, what was learned, and what is changing as a result.

The area that caused the most pain for us is the recommendation to set OKRs as 'stretch' goals, such that you are only achieving ~80% (I actually forget the actual target from Doerr here).  We frequently missed targets, and it was demoralizing for the team.  Going forward, I would not impose this constraint.  I find the value of OKRs in the alignment and transparency, not the 'stretching.'  Momentum is vital for emerging companies, so I would preference more celebratory moments of hitting targets than the somewhat artifical support to 'think big.'  

OKRs are an important tool, but only a piece of the puzzle.  A second framework I find useful is called the Organizational Hierarchy.  In my prior post, I framed it as a problem solving tool, but it also is a mechanism for organizational alignment and goal setting.  

The Organizational Hierarchy says that organizations need clarity and alignment in the following areas, in order of importance from top to bottom:

  • Vision (what change will happen in the world because of this work)
  • Mission (why this change is important)
  • Strategy (how you allocate resources to create the change)
  • Team (who is pursuing this change)
  • Planning (the process of coordinating the tasks of the team)
  • Execution (the implementation  of the work)

The Organizational Hierarchy reflects the greater degrees of freedom, and opportunities for miscommunication and misalignment, that an emerging company faces.  OKRs sit only at the bottom two steps of this framework.   Setting and selling the vision, mission and strategy are more important to organizational goal setting than having a crisp OKR process.  As is hiring the right team.

Mission, vision and hiring are broad topics, but one recommendation for this post: communicate more often than feels necessary.   I recommend a weekly All Hands (more about that in the Teambuilding section here), with leadership sharing and taking questions on the vision and mission at least every six weeks.  It feels repetitive. It feels inefficient. But, in an rapidly growing and changing company, the constancy of the process is invaluable.  

As a founder, take notes on the questions, and on how your own language changes. These checkpoints capture your own learning. You may not realize how your constant conversations with customers, investors, potential employees and others are shifting your own understanding of what the company is doing and why. It will, and should, evolve. That is ok, but you need to make sure the company is moving with you, sharing in the learning and adjustments.

One of the hardest transitions for most founders is to appreciate the awesome potential of a diversely skilled collective ambitiously pursuing a common goal. Most founders are highly skilled in a specific area.  They are already passionate about the problem.  They have had individual professional success.  

Building tools and systems to extend out, and supplement those skills and passion into an well organized, aligned team is the work to be done.

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