THE 20% THAT DELIVERS 80% OF THE RESULTS
Armed with an Executive Guidance Document, managers/team leads can then develop Annual Business Plans that have 3-5 major goals that will deliver 80% of the expected outcomes - the 20% that delivers 80% of the results. In addition, each of the team members can develop annual plans that roll up and impact the various ‘buckets’ that have been identified in the Executive Guidance Document.
Important components of successful Annual Business Plans:
- 3-5 major goals that will deliver 80% of the expected outcomes
- 2-3 strategies per goal
- Strategies are clearly identified as ways to deliver the above goals
- Each strategy should be SMART (Specific, Measurable, Achievable, Realistic and Timebound)
- Goals should have associated lagging indicators to track the progress
- Strategies should be measured with quantifiable leading indicators
The difference between leading and lagging indicators is often a stumbling point. A simple way to demonstrate the difference is with a weight loss example:
For instance, if someone wanted to lose 10 pounds in 6 months (a SMART goal), they could develop 2 strategies that would deliver on the goal.
Strategy 1 - Exercise 3 times a week for 1 hour.
Strategy 2 - Eat green vegetables a minimum of 5 days a week
These 2 strategies are easily measured and, if executed are likely to support meeting the 10 pound weight loss goal.
4. Feedback & accountability
Once goals, strategies and leading/lagging indicators have been developed teams can share initial plans with their supervisors and peers. This alignment session is a great opportunity to gather feedback, understand synergies in team members plans and clearly identify the most important pieces of work that, when executed, will deliver results.
Business planning is an iterative process and likely a minimum of 2 drafts, and 2 alignment sessions are needed to develop a well-developed business plan that supervisors and team members agree will deliver the right results.
A final report out where each member of the team presents their plan to supervisors, team members and often stakeholders provides a way to build ownership and accountability.
Once team members have developed individual business plans that cascade from the Executive Guidance document, it is important to create a scorecard with the most important indicators. Defining the organizational cadence to review the scorecard, as well as making it visible will also be of importance.
Next month we will take a closer look a performance measurement and scorecarding. Stay tuned!
Brent Olynyk - Partner, Lead 2 Perform