What are objectives?
"All our basic tools that underlie our planning and strategic activities are our objectives."
A business objective is what a company or business plans to achieve. Whereas a goal is a broad outcome that builds into an overall vision for the business, objectives are measurable and more focused than goals. Objectives specify the strategies, resources, and time frame required to achieve them.
What are SMART objectives?
When developing objectives for your business, the SMART acronym provides criteria for creating strong, actionable objectives:
For an objective to be specific, you need a clear and concise statement describing precisely what is required to achieve it. You need to specify what outcomes are expected, what strategies will be adopted, who is responsible, and the deadlines for completion.
Measuring progress towards objectives is essential. Setting KPIs and tracking these metrics provides insight into progression. To measure completion, you need a system that will log evidence of the outcomes being completed and the progress towards achievement.
Objectives must be agreed by managers and employees and seen as being achievable. Ensure that those accountable have the necessary resources, funding, and skills to complete the desired outcomes.
Steps taken to achieve outcomes must be assigned appropriately to the relevant teams. Objectives must also be relevant to the overall vision and goals of the company.
Specify the deadlines and completion dates for each outcome and objective. Deadlines can also be motivating since time constraints create a sense of urgency.
Download the Strategic Alignment Accelerator
A free template to link objectives directly to KPIs and execution.
Measurable objectives: KPIs
Key Performance Indicators (KPIs) are the critical indicators of progress towards an intended result. KPIs serve as evidence for the progress towards achieving specified objectives. They aid in decision-making through producing key data and are useful for tracking efficiency within your strategy and execution.
There are two main categories of KPI types:
Strategic Impact Measurements: Strategic metrics track and evaluate progress towards achieving your objectives. Some strategic measurements focus on immediate outcomes, such as sales and awareness, whilst those that focus on end outcomes will track profitability and impact.
Operational Measurements: Operational metrics enable management to improve efficiency through tracking processes and analysing outcomes. Here are some examples dependent on business type:
| Function | Example KPI |
|---|---|
| Marketing | Cost-Per-Click (CPC) |
| Retail | Order Status |
| Sales | Lead:Opportunity Ratio |
| IT | Open Tickets:Total Tickets |
| Manufacturing | Downtime in Production |
Measuring performance and execution
"What gets measured, gets done."
Measuring execution is essential for knowing whether you are succeeding in your strategy implementation. Deciding which measures are suitable is determined by your strategy - therefore, any changes in strategy will immediately impact which measurements should be tracked. Once implementation is in action and measurements are in place, they should be accessible to key decision-makers so that progress can be tracked, risk managed, and necessary adjustments made.
How to measure strategy execution
The Balanced Scorecard
The balanced scorecard (BSC) is a management system that communicates objectives based on the strategy and vision of the company. The BSC categorises these objectives into four areas:
- Financial objectives
- Customer-based objectives
- Process objectives
- Learning and growth objectives
Together, these four types of objectives make up a strategy map. Each objective within the strategy map is then assigned a measure. These measures support and direct the management of strategy execution. However, completing a balanced scorecard doesn't provide a platform in which to monitor all strategic contribution and execution - it creates measures that drive performance but doesn't facilitate a bottom-up approach to strategy management.
Large organisations are extremely complex, often implementing numerous projects and initiatives simultaneously, which cannot be successfully managed by spreadsheets or traditional project management tools alone. The reason these methods are unsuccessful is their incapability to align outcomes with strategic objectives.
After seeing this challenge for many years, we created StrategyWorks - an easy-to-use management system that provides a single live view of your strategy but critically creates perfect alignment between objectives, KPIs, and execution.
See how StrategyWorks aligns objectives to execution
Book a demo with a product specialist - no obligation.