I always talk about outcomes, and how important they are in factoring into what you measure. Whether you are in the KPI (Key Performance Indicator) camp or the OKR (Objectives and Key Results, thank Silicon Valley for this one) camp, I believe it is critical that whatever you measure is tied to an outcome. So often we measure what everyone in our industry measures, and often this ‘it’s always been done this way’ mentality isn’t the best course. Today I want to talk about outcomes for you – or me! (I am normally writing these to talk to myself.)
I have so many friends, acquaintances, and people I get asked to help think through strategy, that are running amazing companies that they have either grown bored with or don’t like at all. There is another subset that set their growth goals around what they think they think they should be doing, or what competitors are doing, because it is just how it is done. I often ask why they want to grow to x, or why they want to sell, and many times they don’t know or haven’t thought it through recently, or ever!
I am here to suggest that perhaps having an outcome in mind will lead to better decision making upstream. The more clear you get on what you really want, the more your business can act as a conduit to get you there. The side benefit is you will likely be more aligned, and the day to day grind, since tied to an outcome, may somehow become less taxing and maybe even (gasp!) enjoyable!
My definition of strategy, which has been somewhat hotly debated in my inner circle, is “strategy is a great story told backwards.”
In other words, you start with the end in mind, and visualize all the things that have to happen to get to that end result, and then build, create, design, enable the business to do those things.
It is dawning on me today that exit strategy is no different.
Growth strategy is no different.
If you get clear as an entrepreneur on what you want, ultimately, it will help you tell your story in reverse. It will also give you a lens to measure decisions against. For instance, if one of your 5-year outcomes is to spend more time with your family, a 100% a year CAGR may not be the right growth goal. Or if you are seeking greater autonomy, bringing on investors and partners to hype up growth may not be for you. Conversely, if your goal is to build a $100MM company, and you are at $10MM and averaging 10% growth you may need to up your growth goals to get there.
I was recently asked to talk about an exit strategy with a friend of a good friend of mine. I asked him about his goals, and one was to use his company to better the lives of his employees, and to amp up their opportunities, etc. Which naturally led me to ask why he was selling. He offered a vague answer that essentially amounted to he was bored, his Forum mates thought it was a good time, and he just thought it was the next thing to do. Even though it was right in front of him he had not connected the dots that selling the company was totally at odds with his most desired outcome which was bettering the lives of his employees.
I know, most of you would not have missed that, but just in case, now would be an interesting time, as we near a new calendar year, to set some “outcome focused” personal goals and just see if your company strategy is in sync.
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