Introduction
I worked with my client, a B2B Tech Service Provider in the Financial space, on implementing a goal setting and monitoring framework. Within 6 months since the beginning of our collaboration we obtained the following results:
- Increased annual target and goal completion rate by 190%
- Increased annual target and goal completion rate from 50% to 95%
- Built a customized and predictable goal setting and monitoring framework. We designed it to address the client’s specific needs.
The client had invested in developing its own proprietary technical solution. The company has not been profitable for the first few years. Thus, it relied on external investor funding. The main reason for this was the investments in research and development.
By year 4, the company started making a profit. The research and development reached a slow down phase. The majority of resources have been re-allocated to support new client onboarding.
At this point, the client wanted to grow the company at an accelerated pace while increasing the NET profit as well. The issue came up when the client realized they had no plan in place to predict financial targets and set goals.
Client Story
The B2B Tech Service Provider has been in business for over 7 years. Target market is B2B SMB clients in the Financial industry, as well as other secondary industries: Legal Services, Wealth Management, Investment Banking etc.
The client operates with a remote and distributed team. Sales, marketing, research and development and customer support teams are engaged full time with the company. Operations team including finance, HR and admin are engaged part time with the company.
Before working together, the client was in the following situation:
- Setting sporadic, inconsistent goals
- Setting unrealistic and unpredictable financial targets (revenue, profit)
- Goals were not aligned with company vision
- There was no tracking system in place to measure goal progress
- Goals did not match 100% business real priorities
- Completion rate was estimated at 50%
The client had no system for predictably estimating revenue, profit and other business health metrics. At the same time, there was no process in place for setting growth oriented goals.
The business was hardly on a consistent growth path. Growth quarters were followed by stagnation or even decrease in performance. The bigger issue was the lack of accuracy in estimation for the next quarter and year in terms of financial results as well as goals to be completed. This situation was detrimental for planning investments and other opportunities.
The Service Provider had the resources and capacity to grow. However without a clear system in place the results did not show. Instead of obtaining a good return on investment, the efforts seemed to be taking nowhere. This is when I started working with this client on setting up a goal setting framework including:
- Predictably estimating financial results as well as other essential business metrics
- Annual and quarterly goal setting process aligned with the business vision
- Milestones and timeline to facilitate goal completion
- Tracking system for goals and KPIs with regular touch points
- Feedback system to understand what works and why
I structured the project in 4 distinct phases:
Phase 1 – Clarity regarding the vision
Phase 2 – Setting goals and KPIs aligned with the vision
Phase 3 – Action driven system for goal completion
Phase 4 – Review and improvement
Phase 1 – Clarity regarding the vision
The client did not have a clear vision for the business in mind. He was aiming for growth, without a determined path to get there.
To set my client up with a strong vision we worked first on understanding where does he see his business in the next 3-5 years:
- What would the company look like?
- What services would the business offer?
- What would the team look like?
- What would the process be?
- What are the biggest issues currently that the client would like to see solved?
- What will the client’s personal life look like? What involvement would he have in the day to day?
Get access to my resource on Vision building
At the end of this phase the client had a strong vision for the business. This allowed him to set the foundation for the next steps: short term objectives and specific plans for meeting them.
Phase 2 – Setting goals and KPIs aligned with the vision
During this phase we focused on understanding the business’ priorities for the next 12 months. At the same time we set SMART goals and financial targets. We worked backwards from the 3-5 year vision and determined what needs to happen next so that the vision is fulfilled.
We used my goal setting framework with the following outcomes:
- Set goals for the next 12 months. We too into account the long term vision as well as what the client presented as business priorities
- Determined most important numbers for the business, starting with revenue and profit
- Put together a simple and predictable system for the client to estimate these numbers. We used historical data as well as current health of the business.
- Defined big picture milestones for all goals
- Assessed the structure including goals, milestones and KPIs against existing resources and capacity. Determined that it is challenging yet realistic.
By now this client could rely on a set of SMART goals and KPIs that would sit at the center of the business for 12 months. The entire focus of the client and his teams will be directed toward achieving those goals. They will not only take the business in the direction of growth, but will also be building blocks for the 3-5 vision.
Phase 3 – Action driven system for goal completion
Phases 1 and 2 are more about strategy, working on the business and long term vision. In Phase 3 I got more in the weeds with the client. We worked on ensuring there is a specific plan and actions in place for every milestone to be achieved on time.
We put in place a proven system, tested by me on my business and with other clients. Most important elements of this system are:
- Weekly time split and workflow to ensure the goals remain in focus regardless of other projects or fire drills
- Daily system for prioritization of 3 actions advancing the goals
- Milestones break down in discrete action items. Included owners and due dates for each
- Action items / to dos have been documented in a transparent way. They were made accessible for all parties involved in the process
- Regular (weekly) check ins on the progress vs agreed timeline
- Monitoring KPIs on a daily or weekly basis and recording them in a scorecard
Phase 3 is where the key for progress and growth lies. It is where clients need a lot of support until new habits are formed. It is also where it can get a little discouraging in the first weeks until the first results start to show.
However, it is also where transformation happens. This is not a one time effort, this is an ongoing process I work through with my clients.
The Service Provider has been set up with a system for taking consistent action toward goal completion.
Phase 4 – Review and improvement
Phase 4 is similar to Phase 3, in the sense that it is an ongoing process. For my client, the B2B Service Provider we agreed on a quarterly review schedule plus a big annual review. For the review and improvement sessions we created an agenda which includes:
- Assess if the goals are still relevant. Setting yearly goals sometimes means that by mid year they become irrelevant. Sometimes, due to a major change in context, they must be postponed. This is completely normal. I always encourage my clients to stay flexible when facing change.
- Thorough progress check against the timeline. Taking action to see if any issues or delays are identified.
- Analyzing what processes work and what can be done better. Take action toward improvement.
- Ask feedback from leaders of the business on the goals, KPIs and what is to be expected for the next period. Make sure the predictions have not shifted massively since the last review session.
- Discuss and solve important issues that may impact the progress of the goals in the next 3 months. In other words, remove bottlenecks.
Phase 4 is as a major checkpoint in the progress toward goal completion. It also plays a crucial role in continuously improving processes and systems. In time, the client ends up with a reliable system and a higher percentage for completing goals. KPIs have also been on a continuous uptrend for the Service Provider since we got in Phase 4.
Overall Results
Before starting our engagement the client had rarely set up relevant goals. Moreover, the goal completion was at best at 50% (estimated).
Here are the gradual results obtained for this client during a 12 month engagement:
- After working together for 3 months, the client was already on track to meet the goals at about 70%+. This was estimated based on milestones completion rate at the 3 month review.
- At the 6 months quarterly review the milestone completion rate was 80+%. In other words, yearly goals were 80% on track to be met.
- During each quarterly review we looked at progress and results. We also aimed at improving workflows and processes for incremental better outcomes.
- At the annual goal review, 12 months after the engagement started, the average goal completion was 95%, including KPIs.
Overall the client went from a 50% goal completion rate to 95% completion rate. This represents an increase of 190% in just 12 months.
Moreover, the indirect results of putting in place my system for goal setting and achieving were:
- Growth rate increased quarter over quarter due to laser focus on business’ priorities
- Having predictability regarding financial numbers allowed for better investment decisions
- Focusing on goals meant less dilution of resources and higher return on business activities
Take Action Today
Look at how you set goals and KPIs in your company. How do you monitor progress? Do you have regular touch points to improve the process and outcomes?
For more insights and actionable advice on building a profit machine start with my free content. My articles outline actionable strategies for improving how you plan for your business.
If you’d rather have a partner to do this with: