Wondering if your company is OKR ready?
Horizontal Goal Cascading vs Vertical Goal Cascading
The setting of organizational goals can turn out to be the difference-maker between a focused, thriving organization and a floundering, chaotic one. Using a solid strategy for establishing common goals at each level of the organization will lead to alignment and success. The finest approach to do this is through cascading goals. However, any strategy can fail if the goals are not cascaded correctly. So, today we will discuss everything about goal cascading and its different methods that will help you plump the most-suited cascading strategy for your organization.
The majority of the leaders do an incredible job of envisioning the future, developing elaborate long-term goals, and conducting strategic planning at the top level but they fail to translate these goals into results and plans into action. The conception of using goals as salvation between the organization’s primary vision and an employee’s daily activity has been around for decades now. So, how is this possible that just 14% of the employees are familiar with their organization’s objectives and direction? As per Forbes, while 65% of the organizations agree upon a certain strategy, only 10% of them are able to execute their strategies. This ascertains that while creating a strategy is a piece of cake, executing it is a whole different ball game.
When formulating and executing the strategy for your organization, it is critical for you to certify that every employee comprehends the overall approach and how their work is linked with the objectives and goals of the organization. But how can you achieve that? This is where the strategy of cascading comes into the picture.
What are cascading goals and how is it important for my organization?
Cascading goals are the goals that are rendered from one level of the organization to the other. It’s a hierarchical framework that is universally used to structure the goals of an organization – it gets everyone from top to bottom exhaustively aligned with the bigger picture. Furthermore, it assures they completely know about what to do by splitting the strategy into clear tasks and deliverables that can be easily conveyed and tracked. Consequently, goal cascading helps you to fosters transparency, clear expectations, and an engaged workforce in the organization.
The book Measure what matters stresses on the importance of goal cascading. Its been forever since several studies have been on the spree of advising the organizations that their employees are guaranteed to thrive when they see how their contribution aligns to the ultimate goal of the organization. Especially in the remote culture, where employees discover that their objectives are directly a key result of their manager’s OKR, which links directly with the top-level objectives. This is a powerful realization. OKRs have consolidated the far-flung departments. Owing to this structured and visible goal cascading methodology, the organizational boundaries melt away.
Having a collaborative culture is the first ingredient in the recipe for taking your organization to incredible heights. Even when the organization operates in silos, it is vertically open. Any team member can communicate freely with their managers, or their manager’s manager and fetch a respectful hearing. OKRs are known to open the organization horizontally, across the teams. At first, the employees may find it cumbersome, but they soon get comfortable with the fact that their manager will remain to be their manager and they’ll continue to collaborate with them. The only change is that they disconnect from their manager and start connecting more with one another. Attributable to the horizontally transparent OKRs, the employees intentionally connect with each other as their objectives are linked. Quarter by quarter, they iterate against the organizational objectives while conceiving how best to harmonize with their peers. As a result, the organization trends away from the senior committee mandate towards real autonomy.
Goals can be cascaded with a clear set of objectives at the individual, departmental and organizational levels. It uncomplicates the process of communicating and documenting your organization’s strategy to the members. Aligning the goals and strategies is pivotal to the organization’s success as it keeps everyone moving in the same and right direction. To drive true effectiveness and purpose in the everyday lives of your employees, your organization’s strategy needs to be filtered down to each level of the staff. All of this is done systematically through goal cascading. The cherry on the cake is that it enriches the employee engagement of your organization as well. Organizations that work in an aligned culture and have a high level of employee engagement thrive on a tremendous level.
1. As per an analysis by Gallup, organizations with a high level of engagement experienced a 20% increase in sales, earned 20% more profits, and were 17% more productive than the ones with low levels of engagement.
2. A study by LSA Global claims that highly aligned organizations increased their sales at a 58% faster rate and earned 72% more profit than the unaligned ones.
To sum it up, your organizations need cascading of goals to:
A. Escalate transparency and accountability when shared publicly.
B. Align your organization’s objectives with the objectives of your employees and teams
C. Dwindle the workflow redundancies, contradicting objectives, and unclear responsibilities
D. Utilize the resources effectively, thereby increasing the profitability
Horizontal Goal Cascading vs Vertical Goal Cascading
Well, now that you are aware of what cascading goal means and how sorely your organization needs it, let us take a glance at the two most common ways that are used for goal cascading.
HORIZONTAL GOAL CASCADING
Horizontal goal cascading means splitting down the goals into the manifold functions that work collaboratively to achieve the organizational objectives. In such a structure, employees are given the leeway to make decisions on their own on the basis of the organizational guidelines.
Horizontal goal cascading feeds much better into the leadership style where leaders want their employees to uncover the best possible way to meet the vision and mission of the organization. Such type of cascading is best suited when you want your employees to drive creativity, innovation, and efficiency. It is conceived to facilitate teamwork and collaboration as operational decisions are typically taken by those performing the operations. Communication in the horizontal approach directly flows to the employees who need the information rather than up the chain of command. This flow expedites the moving of information and reduces the transactional requirement of the upper-level management.
There are key advantages of using the horizontal goal cascading for your organization:
Room for creativity
The horizontal goal cascading provides your teams with an abundance of opportunities to give their input and suggestions. Being a collaborative approach, it facilitates the room for brainstorming, feedback, and constructive feedback that navigates the organization to better outcomes.
More informed decisions
In such a collaborative framework, the employees that work directly on projects and oversee the project management can communicate the decisions that will impact their future work. As your team leaders work directly with the team members to chart a course of action, it fends off the potential blind spots that could otherwise appear if decisions were taken without team input.
The horizontal approach encourages greater buy-in from the team members as each of your employees will be given the prospect to influence the decisions regardless of their seniority. This also fosters better relationships between colleagues by offering members of all levels a fair chance to impact the outcomes.
VERTICAL GOAL CASCADING
In the vertical goal cascading approach, you being the leader will oversee establishing goals that will then filter down through the hierarchical structure. It is more suited for an autocratic leadership style where leaders set the goals and employees are expected to work on attaining those goals.
The leader starts with the big picture goal and works backward to determine what actions are required by different teams in order to achieve that goal. However, more power at the top of the pyramid doesn’t necessarily mean that none will be at the bottom. At the fundamental level, this framework simply involves the provision of direction from the top. Being more rigid and structured, it is best-suited to organizations having multiple sub-teams and departments.
There are key advantages of using the vertical goal cascading for your organization:
Alignment and clarity
The communication and coordination involved in vertical goal cascading allow for a holistic approach assuring resources are distributed effectively and the employees are not pulling in distinct directions. This approach cultivates clarity and leaves little to no room for any sort of confusion. As all the decisions come from one end, mix-ups and misunderstandings happen rarely.
The vertical goal cascading approach mandates for the goals to be cascaded down the organization alongside an accountability matrix. As individuals become responsible to achieve specific targets, it creates a demand for improved reporting. Even if inefficiencies or problems do occur, this approach makes it manageable to track them.
Since the decisions are taken at just one level of management, the vertical goal cascading approach is way swifter to implement. The goals can be finalized, distributed, and implemented at a faster rate than the ones that require input from multiple leaders and project stakeholders.
When it comes down to it, leaders should strive to balance the efficiency of the vertical goal cascading approach with the collaborative and creative advantages that come from the horizontal cascading approach. Locke and Latham says that 90% percent of the time, challenging goals led to higher performance than easy ones.” Thus, we believe that by blending the elements of different approaches, you can find the right balance that works the best for your organization.