OKRs for SaaS Companies
Start-Ups = Growth
Growth is fueled by Alignment.
OKRs drive Alignment
Building a SaaS business is hard work, and requires a well-orchestrated engine of Sales, Product, Engineering, Customer Success, or Product Marketing to work with the common goal at all times. As leaders of a SaaS start-up, your initial days might mostly be about trial and error, until you reach that predictable and repeatable formula that brings you on the path to successful returns and customer acquisitions. Congratulations, your success formula has helped you get beyond the $1 Million revenue mark and you are going all guns to get to the $10 Million ARR.
But as you may have heard “What Got You Here Won’t Get You There”. And this brings up the important question now:
To grow your business at an aspirational, fast yet achievable & sustainable pace, you need to optimize your operational output & focus on efficiency growth. A practice that we see tons of successful founders and CXOs adopt is setting SaaS OKRs early to increase the focus and impetus around growth-based initiatives and minimize inefficiencies or misalignment that could be key de-railers to organizational growth. OKRs are a great Goal Management framework that aligns teams and propels them towards that 10X growth you always wished for. A lot of content is now published on this transparent, inspirational, and collaborative goal framework.
OKRs are a goal framework that enables strategy execution. The great part of this framework is that it can be implemented in organizations that are fledglings to elephants which can be still very agile, though big! The litmus test for OKRs should be ‘Are they inspirational? Would they pump up my teams? Do they really define success?’. KPIs on the other hand is an integral part of an OKR. They measure the success, the output, quantity, or quality of a task that has been defined to achieve the Objectives.
Instead of boiling an ocean, we decided the best way is to boil a pond. So, thanks to John Doerr, we started with the principle of Measure What Really Matters. Given the innumerable metrics available to measure a business (CAC, ACV, Burn Rate, Customer Churn to name a few), choose what is most relevant for your company to achieve its desired growth and get going.
Here’s an example of how ACME Corp got OKRs aligned from the Organization to Teams.
In the example below, we chose MRR (Monthly Recurring Revenue), and Increasing Users as the top objectives keeping growth in mind. You can choose according to what matters most to your company.
Choose objectives that suite your company.
While setting these objectives and KRs is crucial, remember the golden rule for OKR success.
Also, remember, 60% of the Key Results and tasks should be defined by the teams and employees to build ownership, accountability and communicate the timelines effectively. These will help you build the growth culture you desire for your company. Struggling with OKRs on spreadsheets while trying to achieve high growth?
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