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4 minute read
Why are OKRs so important, for the business and for the marketing team?
The ‘no shit sherlock’ answer, of course, is how do you know what to focus your time, resource and budget on if you haven’t figured out what success would look like for your business in real terms. It sounds so simple, but I’ve seen it be poorly managed or implemented so many times.
Start your 2024 with a clear view of what success looks like by avoiding these 5 mistakes:
- Lacking a connection to the mission and/or purpose
Having an aspirational mission, vision and purpose for your business is imperative in starting to articulate the problem you're solving for your customer and why you’re motivated to do so. But what does that actually mean in terms of what you’re striving to achieve: market share? Revenue? Profitability?
Don’t fall into the trap of thinking that having a product/service and a good marketing and sales plan will magically bring you success.
When done properly, OKRs will bring your mission and purpose down from the clouds into tangible business metrics from which effective product, marketing & sales plans can be formulated, tracked back to business results and continually optimised to steer the ship towards success.
Businesses should take the time to rally the troops and zoom out.
- Not having the right people in the room
While the people who have the clearest view of the business objective may be sitting at the top, if you want the business to succeed, everyone in it should be clear on the OKRs. Don’t make the mistake of alienating your team/s from the business plan and objective. Don’t just communicate it - sit with them to make sure they understand it thoroughly and feel like they can back it. Answer their questions and make them feel valued in helping to achieve it.
Involving more people in the OKR process will translate to them feeling part of the solution and automatically more ‘bought in’.
Depending on the size of the business, this can get challenging and may require a trickle-down process from key stakeholders to team members but the intention is the same.
There’ll be SMEs who can offer helpful ideas and insights into Key Results, specific metrics and their relative ease to measure and correlate, that would help develop OKRs that make real sense. At the very least, ensure you have a representative from each of your teams/departments/chapters to ensure maximum buy in and backing.
- Neglecting to size the market
Sorry folks, but it’s not good enough to aim for x% more than last year… where’s the ceiling on your attainable market? Are the market conditions favourable to achieving that?
Bring your team together to ask:
- Why do we exist for customers?
- What problem are we solving for?
- How many customers exist that have this problem?
- Are our investors wanting revenue or profitability?
- How much runway do we have?
By getting clear on the size of the market and what’s driving the business, it becomes easier to put meaningful numbers around it that marketers (and other teams) can distil down into effective plans.
- Not looking at your competitors
This should ideally form part of your sizing the market exercise but is often challenging for businesses in industries where publicly available data is limited. That said, asking the below questions and even doing some mystery shopping could help your refine your market sizing:
- Are your competitors gaining or losing market share?
- How many competitors do you have?
- What’s their combined market share?
- What’s left that you can most easily grab?
- What percent do you want to steal from competitors?
Adding this step refines your attainable market to a more realistic volume, or refines your strategy to one of running your own race or stealing market share with a better product or service. That will in turn help your marketing team better position the brand, define the target audience and formulate appropriate, and effective tactics.
- Treating OKRs as set and forget
Even with the best OKRs that have translated your mission and purpose into a tangible, investor supported, objective and key results, and where your team have been involved or consulted, you’ll need an operating rhythm that keeps momentum going.
Don’t let your OKRs sit on the shelf and trust that the plans will somehow be contributing. Ensure each team is reporting back regularly on the agreed metrics that best correlate and be ready to shift and optimise based on what the data is telling you.
Customer behaviour evolutions, market condition changes and competitor shifts are always happening, meaning the plans to support the OKRs need to be flexible and responsive to change.
A first attempt at OKRs won’t be the last and with data and testing you may find one or more of your agreed KRs actually doesn’t correlate with the objective like you thought it would. That’s OK - learning achievement unlocked!
Not having good OKRs will hurt you.
One of the biggest observations I’ve made over the years is that not many people actually get marketing. In a business, if marketing isn’t able to come to the table with results that are easily correlated up to the one or two metrics that the CEO or business owner is looking at, then marketing becomes misunderstood or even dispensible.
But many times when I’ve asked: “what’s the objective” the answer has been unclear, poorly articulated or too complex. So many businesses think they need to achieve everything as their objective: have a market leading product loved by customers, be recognisable and preferred against competitors, be first considered, acquiring volumes of new customers, retaining them and seeing high advocacy. That’s just described the whole funnel. It’s not a business objective. Marketing teams are immediately reporting on a multitude of metrics and getting nowhere. Don’t get me wrong, all those metrics are important to track, but they ladder down from something bigger and more easily correlated with business success.
Having good OKRs isn’t only for big businesses. As a sole trader I’ve completed my own market sizing and OKRs that became the foundation for a manageable set of tactics that I can implement and track to see what drives success.
A single marketer in a small business could take a day out of the month or quarter to sit with their business leader and work through the process to better inform their marketing plan and become a more effective marketer.
Need help kick-starting your 2024 with solid OKRs?
Reach out for a free chat.
