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Strategic Objectives and KPIs

This is the third article in our ‘back to basics’ tour of the strategic planning process. Previously we have looked at vision/mission definition and the research and analysis stage. Now we move on to the formulation of strategic objectives and KPIs.

When setting strategic priorities, organisations define up to three focus areas that will be delivered within a defined strategic period. To deliver these, strategic objectives and KPIs must be set.

What is a strategic objective?

A strategic objective is an action-oriented statement that defines what must be done in order to achieve the strategy. In essence, it is a simple intent designed to deliver continuous improvement. The full set of objectives will provide the strategy’s building blocks.

It’s important to note that:

a) as a continuous improvement activity, strategic objectives will have no fixed start or end point.

b) as an action-oriented objective, a strategic objective will begin with a word such as: improve, increase, reduce, decrease, enhance, strengthen or grow – reflecting the desired end goal and positioning the quantifying element of the objective. The defined measure will then be quantified in the associated KPI.

The strategy map

Where organisations are using the Balanced Scorecard methodology, strategic objectives will be formalised into a strategy map []. This is designed to show connectivity that ‘tells a story’ across each of the BSC perspectives, and which demonstrates how the organisation will deliver value for customers and stakeholders.

What are Key Performance Indicators? (KPIs)?

Alongside each strategic objective will be a KPI. This will objectively measure the progress of every strategic objective, providing data to support stronger decision making. A good strategy will encapsulate a blend of leading and lagging measures. Each KPI will have a target, which describes its desired outcome within a clear timeframe. Targets are a key element of the implementation plan and give employees fixed and measurable sets of expectations to work towards and achieve (particularly where strategic targets are linked to performance management, recognition and reward.) Find out more about KPIs in depth here:

The importance of KPI’s and objective linkage

KPIs in themselves are of little value and they must be linked to a strategic objective in order to be of importance. This can be challenging, and KPIs may refine over time as part of the cyclical strategic planning process. By setting KPIs within a facilitated workshop that includes key decision-makers and functional leads, access to the rich pool of internal knowledge can help create meaningful KPIs.

How established frameworks can help

As mentioned, on a practical level the setting of objectives and KPIs can be challenging – especially for the latter measure, which will naturally look very different at a functional level. Within the strategic process, KPIs must be consistent and set so that they are meaningful for the owning department whilst contributing towards the broader organisational strategy and goals. This process can be facilitated by using management frameworks such as the Balanced Scorecard. KPIs can also be effectively monitored and measured by systems such as QuickScore to easily evidence whether strategic objectives are being attained within their timeframe and to what degree.

The value of the strategy workshop

Many organisations will choose to set KPIs as part of a strategy workshop. The beauty of the workshop is that it is delivered according to a proven and structured methodology, such as the Balanced Scorecard, and facilitated by an expert in the field.


Once strategic objectives and KPIs have been created as part of the strategic planning process, owners will be assigned to have responsibility for each. These responsibilities will be defined within the strategic implementation plan, along with clear timeframes and necessary delivery resources. This begins to start embedding the strategy within the organisation and brings it to life, by assigning responsibilities to owners.

In the next article, we’ll look at this crucial implementation stage, which must happen in a full and timely fashion once all of the definition, research and planning activities have been carried out. In the meantime, why not download our free beginner’s guide to strategic planning