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Business Unit North is one of the leading players in the field of FMCG. Their portfolio includes more than 70 premium brands and now their Main Objective is to double their EBIT in the next plan period.
How can Business Unit North achieve its Objective with KeepSolid Goals? Check out this OKR case study!
Key Initiatives for Business Unit North in OKR Framework
After setting the main Objective for the next plan period, the Business Unit North team took a deep look at the market opportunities and brainstormed the main business drivers for the next plan period. At the end of the meeting, they formulated the key initiatives for their company.
Initiatives to increase income
The busiest seasons for the Business Unit North team are Summer and Winter. That’s why company always prepares for these seasonal changes in time so that they could work effectively. To do so, Business Unit North has to:
- Plan the development of POS materials and their logistics needs in advance
- Ensure the stock availability of products for sale
This initiative is about a product-line expansion and launch of new SKUs in all existing trading channels. This includes the following:
- 1. Modern Trade
- 2. Traditional Trade
- 3. On-trade
Initiative to control costs
According to Business Unit North’s profit and loss statement (P&L), the main item of their expenses is Transportation & Storage. As a result, one more company’s objective is to keep sales growth at 23% and not to let costs increase higher than 10%. For this, the company plans to:
- Solve the out-of-stock problem via rental of additional storage before a start of the season
- Increase the minimum order quantity for distributors
- Ensure the full stock availability of their products before the busy season begins
- Deliver 3 new SKUs to stock and provide their sales team with access to these products in time
Firstly, you should decide what you want to achieve. To define the main strategic objective, Business Unit North has used their P&L statement. After analyzing their profit and loss statement, they’ve set an Objective to double their EBIT in the next plan period.
The achievement of your Objectives requires control of your income and expenses.
At this point, you have to understand how exactly you are going to reach your Objective. For this, you should:
- Assess threats and risks that can negatively impact the achievement of your Objective
- Note: You should do this before developing an action plan
- Define the Key Results whose achievement will move you closer to your Objective
- Set Key Performance Indicators (KPIs) for these Key Results
- Assign your workers to the Key Results
Now you should create the needed set of tasks that are essential to reach your Key Results and assign your workers to these tasks. Ensure that your team is aware of task priorities, their sequence and deadlines. For this, you can use the following features:
- Roadmap
- KPIs
- Budget Control (upcoming feature)
To achieve the Objective, the Business Unit North team has used all the features of KeepSolid Goals. Now you can also benefit from their experience. All you have to do is:
- Use Kanban board and Roadmap to monitor the achievement of your Objective
- Track your Objectives status with Reports
- Regularly check the My Tasks tab to control the process of tasks implementation
Stay tuned to market trends and take advantage of market opportunities:
- Update your Key Results when necessary
- Assign new Tasks to your workers that ensure Objective achievement
When your team complete all Tasks and Key Results to reach your Objective, you should summarize your successes and failures. At this final stage you should answer the following questions:
- Have you reached your Objective?
- Have you allocated your resources right?
- What difficulties did you encounter while working towards your Objective?
- How effective was your team at reaching your Objective?
Business Unit North has completed 96% of its Objective with an
EBIT value of $117K.
The company was well prepared for their business’ busy seasons and so their marketing promotions were very successful.
The main negative factor that has become an obstacle for completing 100% of their Objective is the control of Transportation & Storage expenses. Unfortunately, Business Unit North couldn’t keep sales growth at 23% and, as a result, Transportation & Storage expenses amounted to $335K. In the previous period, this expense item amounted to $330K.
