Don’t Create Cross Functional Fighting: Align Your Goals With Your KPIs
As a smart businessperson, you know that you must have goals to achieve, and key performance indicators (KPIs) to help you reach those goals. But what happens when each department’s specific KPIs don’t quite align for the better common goals of the business?
There was a lull in revenue at a business I was working at. This meant that there was no more wiggle-room when it came to work that had to be done. Upper management became stricter and had each department hard-pressed to their KPIs.
Sales was told to sell at all costs and do whatever had to be done to close.
Client Services was no longer allowed to accept late orders from clients or they would get de-merited.
Operations could not have over 2% variance in production procedures.
These were hard and fast rules—no one wanted to risk not following them because their jobs and commission were on the line.
Then, one of our biggest clients called in and wanted to place an order. A late order.
The sales team was ready to push this through—after all, we were in need of additional revenue and they did not want to say no to our biggest client. But this late order would mess with the client service and operations departments’ KPIs.
They pushed back, because they didn’t want to be out of compliance. This resulted in arguments developing between departments, all because of one glaring issue: their goals weren’t aligned with the company’s best interests in mind.
Successful goals can’t be created in a silo
After days of departments getting resentful towards each other, I decided to speak to the president of the company. These KPIs weren’t working together, and the departments weren’t working together, either.
On their own, each department’s KPIs made sense to help the company’s revenue. But when working together, they didn’t align at all. The president finally understood when I brought this to her attention; everyone was just trying to do their job as they were told to do so, but each person’s goal wasn’t fully thought through at the top level to see how they may be conflicting.
After our discussion, things got better. Management realized that, because they were in need of more revenue, they became too strict with their black and white KPIs.
Shortly thereafter, an arbitration committee was formed. This helped create a middleman so that no one department felt as if they were being taken advantage of. If rules had to be broken outside of the regular KPIs, it was for good reason and no one would be penalized for it.
We all learned an important lesson, and our company became better because of it.
Have goals and make them work
Though KPIs are essential to reach goals, it is also vital that everyone’s KPIs are shared departmentally to ensure they align and make sense for the greater good of the business. This may sound like an obvious statement, but if not thought through well enough, it could be detrimental to your business.
Don’t lose momentum or morale; create greater success! The art of shadowing cross-functional teams’ lives will make a stronger culture.
Start by creating goals and then align your departments’ KPIs. That’s how you’ll achieve better outcomes.
Make sure KPI’s are aligned (sound like a duh).
Publish and share KPI’s to identify the grey areas and have a process in place to keep the momentum and the moral of cross functional teams intact.
- The art of shadowing cross functional teams’ lives will build a strong culture.