User Story – Globex

Corporate OKRs

To start the quarterly planning James Carlton brought his management team together to discuss corporate objectives.

At the corporate level Globex does not define key results. Instead they define company objectives, then department leaders will contribute their own objective to align up as key results for the corporate objectives.

1. Part of Globex’s core mission is to deliver exceptional services and products that turn customers into partners. Because of this they have one common recurring objective: Create a Fiercely Loyal Customer Base. Additionally, another objective that has been present long term is to increase profitability. While it’s a simple objective, the organization is heavily focused on consulting and sees this as a foundational element of any service business.
2. Beyond these two common items, the group identified a recent trend in revenue coming from the Latin American market, as well as projections for increased growth in the region in the coming years. Because of this a core objective will be to improve Globex’s position in the market to establish growth for years to come.
3. An opportunity was identified in the virtualization software space to adapt some existing Globex technologies into a new standalone product. Launching this product successfully is a key objective to establish a new revenue stream for the business.
4. A recent acquisition has resulted in a greatly increased engineering capacity. Historically the consulting division has some engineering in-house, and much of it contracted to 3rd parties. The organization wants to focus on properly aligning these groups more to better leverage their existing resources.

At the end of the initial meeting, the team had identified these as their target objectives.

Continue through the rest of this series to learn more about how each department formed their OKRs. After each department concludes their own processes, the final corporate OKRs look like this:

Product Management

Ellen Genix leads the product management department and started the OKR conversation for the quarter by meeting with her team once the company objectives were formed.

Initial Meeting

In this initial meeting they identified the company objectives that were best influenced by the product management department, and asked whether they had any additional objectives they should consider this period. This analysis confirmed the department will focus on three company objectives:

1. Create a Fiercely Loyal Customer Base
2. Increase Profitability
3. Launch New Virtualization Software Suite

Once these 3 top level objectives have been identified, it was time to determine how product management could best contribute. The initial conversation produced churn reduction as a top priority, as it’s been a known problem in recent history. Additionally with the new product launch the team defined a best-in-class user experience as their key objective to focus on. While reducing churn aligns with loyalty and profitability, the department still wanted to identify some more granular objectives for the analytics platform. They elected to focus on improving the onboarding process, and generating more revenue from existing customers on the platform.

Armed with a set of objectives team leaders broke out to identify key results which will be used to track progress. This started with talking between team members to discuss known issues, then reviewing analytics to identify underperforming metrics that can be targeted. For this example let’s cover the “Reduce Churn” OKR in detail:

• Reviewing their analytics platform identified that one metric had been slowly rising over the past 18 months: # of registrations with a single login. This means users were signing up and not getting the product they expected, running into some problem, or unable to properly get the system set up. Two years ago only 9% of users left after registration, but now it’s 24% who never come back. Focusing on keeping users in the system at the top of the funnel should reduce overall churn so they targeted a reduction down to 18% this quarter.

• The team has been tracking a set of special product features called “sticky features”. It’s been observed that companies using at least 1 sticky feature are 2.5x less likely to churn after 12 months. Because of this the team wants to focus on increasing the number of companies using sticky features.

• While there are other metrics to focus on as well, the core metric of reducing churn was included. Analysis concluded that if a customer does not churn after 1 year, they produce 14x more revenue compared to a company who does. For this reason they elected to focus on this 1 year churn period.

• The final key result chosen was the time spent within the application. Businesses where users spent an average 4 hours a week within the system produced 9x more revenue than others. The current average was only 2 hours, so this was chosen as a far-reaching target.

The result of this analysis was the following completed OKR.

A similar process was executed for each of their identified objectives, resulting in the following OKRs:

When tackling how to create a best-in-class user experience, they focused on a key functional element of how long each task takes, and then identified key user feedback metrics which can be used to validate success.

To tackle the challenge of streamlining their onboarding experience they focused the key results that ensure the process is quick to complete, and ensure not only speed by also successful conversions. They had also observed a strong correlation between success of users who had received product demos, so a focus was put on engaging new users as well.

For the final objective of increasing revenue from the analytics platform an initiative was planned around launching new and improved features, and focused on tracking specific revenue and engagement metrics related to these features.