Management By Objectives (MBO)

How to empower and align people & teams on strategic company objectives? Peter Drucker was the first person to introduce his Management By Objectives theory in 1954. What a visionair ;).

In this blogpost I will guide you through the approach on defining strategic goals or objectives and to align them with measurable key results. The Objectives & Key Results (OKR's) framework deriving from it and playing a central role in it.

In an ever hybrid world people try to 'connect' with each other in different ways. Online meetings, working from different places and sharing company information through different communications.

The Management By Objectives theory and the derived OKR framework puts antoher connection layer on top if this. Having people aligned on strategic organization goals or objectives resulting in people being more empowered.

The OKR management framework gives people and teams more direction in their day-to-day work, contributing to higher goals. In order to motivate them, objectives should be ambituous, time-boxed and clearly defined. On regular timings the should be checked and reviewed, this to monitor their progress towards defined metrics.

Within the MS VIVA suite you will find a nice state-of-the art performance management tool called ViVa Goals. Following print screen gives you a first impression of how defined objectives could look like.

Nice feature is that each objective can be set on a different level, i.e. Organization, Team or Individual. By using these different levels you can define a bottom-up or top down goal setting approach. Best practice is to have more or less 5 objectives defined.

Let's take a first example. One of the strategic organization goals could be improving customer satisfaction, this at an organizational level and for a defined period (Fiscal 2023).

Objectives are a great way to focus on the company's most important goals. OKR's are broken into 2 components, being the objectives itself and their related Key Results. In our example of the customer satisfaction this could have following key results.

Each of the key results being time-framed and checked at a different phase. Could be also for the same fiscal period or more broken down into quarters. You can see in following example that one of the key results is to have a Net Promote Score > 8.0 by the end of the first quarter.

Or having different objectives for our marketing department, also broken down into several key results. These goals and child key results can then be communicated to the different teams and people so that they have a clear direction on where the ship sails to. And also important, how each of the individuals contribute to the higher goals.

Finally, at regular times the key results are measured through Check-ins and are a way to measure the heartbeat of the key result, the higer objective and the performance overall of the company.

So why not implementing your Digital Roadmap and having it broken down into different strategic objectives and measurable key results.

Or when implementing the PowerPlatform as a toolset with its CitizenDevelopment, why not also define it as a strategic toolset. In my opinion a real need when implementing it on a technology & people layer.

Wrapping this up, MS ViVa Goals can play a central role in being your company performance management tool. Setting clear priorities on organization, team or people level and being a transparant means of communication to employees.

Happy X-mas folks

Kind regards,

Frank Vanhamel