Exec Team Khorus Onboarding © 2017 Khorus Software

Success today looks like Answer why Khorus Learn how to use the Khorus platform (3 main goal workflows) Discuss and agree on Company Goals Discuss steps to create Exec Team’s Department Goals Clear understanding of Next Steps and schedule to onboard entire company © 2017 Khorus Software

Your Khorus Customer Success Team Philip Parker Customer Success Manager

Introductions Name Title What area are you responsible for?

Khorus Overview

Strategy Execution “Approximately 5% of all organizations implement their strategies successfully, and 70% of strategic initiatives fully fail to meet their objectives.” Randy Ottinger is an EVP at Kotter International, a firm that helps leaders accelerate strategy implementation in their organizations. John Kotter is the Chief Innovation Officer at Kotter International, and is the Konosuke Matsushita Professor of Leadership, Emeritus, at Harvard Business School.

Organizational Alignment “The workforce feels largely disconnected from strategy. We found that, on average, only 21% of the workforce is actively aligning their efforts with company goals.” Corporate Executive Board

Khorus: The What and the How Khorus is an Organizational Leadership Platform that helps your CEO and Leadership Team execute the strategic plan and drive organizational performance Aligns the entire organization around the organization's strategy Engages employees creating a culture of accountability, transparency and purpose Creates an Agile, Predictive organization that can adapt quickly to changing business environments Methodology + Software

Khorus: Two Powerful Parts Methodology Software Khorus Want a copy? Email elizabeth@khorus.com

4 Khorus Goals Workflows 1 3 Create Quarterly Goals Run Weekly Team Meetings The Performance Dashboard provides a framework for each team’s weekly meetings, identifying the status of all team goals and drawing attention to ones that need focus and support. The CEO creates organizational goals each quarter. Managers and employees create their own goals that may cascade from the top-level ones. 2 4 Predict Performance Weekly Finalize Results Each Quarter At the end of each quarter, all employees identify which goals have been completed, along with evaluating the quality of results. Every week, employees update the status of each goal, on scales for both Likelihood and Quality. They can also add comments on progress and obstacles.

Aligning the Organization: creating quality goals in Khorus

1: Create Quarterly Goals - Key Concepts Agility: Goals are set on a 90-day cadence. - Throughout the period, goals can be modified, reassigned, shelved or deleted. Alignment: Goals are meant to cascade; lower-level goals aligned to higher-level goals Start with the CEO’s “company” goals Then Leadership team goals Then let everyone else create their goals when ready…level by level not required Goals can be created and aligned to higher-level goals later Most goals should link to higher-level goals…but not required Most goals will align with their managers…but not required Goal types: Company – organization’s goals owned by the CEO - Set by CEO, no approval required Individual - set and owned by Managers and Individual Contributors - All approved by direct manager - Can stand alone or align to a parent goal - Others can cascade from these goals

1: Create Quarterly Goals - Alignment Goal relationships are separate from the organizational structure. Most often a person’s goals link directly to their manager’s goals. All goals are “aligned” throughout Khorus in a series of “parent” and “child” relationships. Company Goal Individual Goal Individual goal “parent” “child” Individual goal Individual Goal CEO VP Manager Director Individual Contributor

1: Setting Quarterly Goals - Outcomes vs. Actions Focus your goal-setting in Khorus on the Measureable Outcomes you want to achieve rather than the Actions you will take to achieve them. Ex. Outcome: Decrease marketing outbound bounce rate by 3%. Ex. Actions: Publish new marketing campaign content by June 12th. Track day-to-day work and plans in other tools. Think about outcomes that are going to have an impact on higher- level goals or the corporate strategy.

1. Create Quarterly Goals - Details Every goal requires a Title and Measurement. It is encouraged to use the Description field to add context for the goal. Most goals should be linked to a parent goal. Most goals are linked to the goal owner’s manager…but not required. Every goal creation and changes to a goal are submitted to the manager for approval.

1: Create Quarterly Goals - Taxonomy Title: Concise aspiration of what this goal is achieving, easily recognized by the rest of company Ex: Increase new business sales Ex: Generate marketing leads Ex: Launch new product

1: Create Quarterly Goals - Taxonomy Description: Additional context about what the goal is achieving and why it matters.

1: Create Quarterly Goals - Taxonomy Measurement: How progress and success of this goal will be specifically measured. Ex: $10M sales orders Ex: 5,000 qualified leads Ex: Product available to quote, sell, and use in production with live customers. * Target date is end-of-quarter unless indicated otherwise with mm/dd/yyyy. * For goals that extend beyond the quarter, put the measurement of success for this quarter only.

1: Create Quarterly Goals - Taxonomy What’s a Private Goal? Private goals are a way to create goals that are only visible to you and your upward management chain. Goals cannot be cascaded to and from private goals. Private goals should only be used when the information in the goal should not be shared with the entire company. - Goals around mergers - Goals around personnel issues - Goals where NDAs dictates Private goals should be used sparingly as the objective of Khorus is to build a culture of transparency.

Reminder – Selecting Quarters When creating new goals in Khorus, the platform always defaults to the CURRENT quarter. If you intend to create goals for the coming quarter, be sure to SELECT that quarter from the pull-down selector.

Annual Goals vs Quarter Goals If you want to capture annual goals in Khorus: Put Annual Goal details in the Title field In the Measurement field clearly define where you want to be at the end of the quarter. Examples: Title (Annual): Grow engineering team by 10% (20 new hires) by end of 2017 to support company’s new server product development initiative. Measurement (Quarterly): Hire and onboard 5 engineers in Q1’17. Title (Annual): Grow 2017 sales by 30% over 2016 in support of company’s 2017 financial targets. Measurement (Quarterly): Close $3M in sales in Q1’17.

1: Create Quarterly Goals – Example #1 Title: Is it concise? Will people know what this goal is about by reading the title? Description: Enough context to answer WHY this goal matters? Measurement: Could there be any confusion on whether the goal is achieved or not this quarter? Grow business profitably Previous focus on top line growth for the past few quarters has impacted overall profitability. Goal is continue revenue growth but not as aggressive while achieving 15% EBITDA by end of 2017. Grow revenues by 5% Q-Q and achieve 12% EBITDA.

1: Create Quarterly Goals – Example #2 Title: Is it concise? Will people know what this goal is about by reading the title? Description: Enough context to answer WHY this goal matters? Measurement: Could there be any confusion on whether the goal is achieved or not this quarter? Increase marketing It is important that we continue to focus on growing MQL pipeline to hit our annual business plan. +12%

1: Create Quarterly Goals – Example #3 Title: Is it concise? Will people know what this goal is about by reading the title? Description: Enough context to answer WHY this goal matters? Measurement: Could there be any confusion on whether the goal is achieved or not this quarter? Production release of product XYZ To achieve the 2017 revenue plan it is critical that Product XYZ releases for production on schedule with all key features enabled, no major quality issues, marketing and channel ready. Standard production release for end customer purchase by November 15th.

The Stretch Goal Paradox “Stretch goals are not only widely misunderstood but widely misused. Organizations that would most benefit from them seldom employ them, and organizations for which stretch goals are probably not a good strategy often turn to them in a desperate attempt to generate breakthroughs. Neither approach is likely to be successful. By examining recent performance and resources, executives can assess how feasible stretch goals are for their organizations.“ 2011 award-winning Academy of Management Review article Michael Lawless and Andrew Carton Failing but grasping Discouraged but capable Confident but constrained Thriving but complacent Avoid stretch goals Pursue small wins Consciously build slack resources Plan for small losses Stretch Goals? Organization Status Consider stretch goals

Khorus…Building a Predictable Organization “Shoot for greatness. But greatness doesn’t always come from dramatic leaps. Sometimes it comes from small, persistent steps.” Michael Lawless and Andrew Carton

Focus the Organization: Setting “Company” Goals

Customers CEO Balance shareholders employees

Product Sales Marketing

Corp Goals

Sales – Revenue, Bookings, Collections, Pipeline Marketing – Leads, Meetings, Awareness, Markets Product – Launches, Features, Delivery Employees – Hires, Engagement, Productivity Customers – Satisfaction, Retention, Expansion Shareholders – Profit, Cash, Valuation

Key Questions During Goal Setting What should the measurement be? What other measurements could we consider? Who can contribute to this goal? If all the sub goals are successful will we reach the corporate goal? Why, why, why are we doing this goal?

Cascading Quarterly Goals

Perfect metric

Predictive or at Least Real-Time Comparable to the Competition Easily Measurable Directly Correlated Predictive or at Least Real-Time Comparable to the Competition Only Dependent Upon thing Being Measured

S M A R T Specific Measurable Attainable Relevant Time-bound Significant, stretching, simple Motivational, manageable, meaningful Appropriate, achievable, agreed, assignable, actionable, adjustable, ambitious, aligned, aspirational, acceptable, action-focused Result-based, results-oriented, resourced, resonant, realistic Time-oriented, time framed, timed, time-based, timeboxed, time-specific, timetabled, time limited, trackable, tangible

Best Practices Don’t Let Perfect be the Enemy of Good Ask Why Until it Makes Sense Think About Alternative Measurements Manage for Predictability Thank People for Bringing Up Issues

Best Practices for Setting Company Goals 5 to 7 company goals (focus for next 90 days) Touch multiple strategy quadrants Use 80 / 20 rule (<20% of focus is on new initiatives) Select set of goals that can include 100% of employees Consider an “Operational Excellence” or ”Continuous Improvement” or “Personal Development” catchall goal

Company Goals Copy Company Goals and Measurements Here 1. Goal #1

Organization “Company” Goals How do they align with the strategy? Do they meet the best practice criteria? Are the measurements clear? Are they achievable this quarter? If the Leadership Team goals are achieved, will the Company goals be achieved?

Rally Cry Akdjo;waif adk af eaf “a word or phrase that is used to make people join together to support an idea, cause, etc.” Webster Copy Company Rally Cry Here Akdjo;waif adk af eaf

Start to Align: Setting Department Goals

Goals: What to Expect In the beginning… People don’t really like setting goals and being accountable. Then something special happens, a transformation… Goal setting becomes natural, comfortable. Employees begin to enjoy the transparency, they like having a voice, they understand their purpose, they need to see their impact, they like understanding their manager’s expectations, and they are driven to deliver results!

Your Evolution with Khorus 1: Understanding Visibility & Exposure Vertical Normalized & Insightful 2: Alignment Focus & Cohesion Horizontal Streamlined & Timely 3: Predictability High Performance & Adaptability Playbook Proactive & Healthy Phase Value Goal-setting Meetings CEO & Executive Commitment, Implementation Team Capability, Culture

Progress… not …Perfection Your Evolution with Khorus Progress… not …Perfection

Leadership Team Goal Discussion Review the set of Company Goals. What top few priorities will give your team the biggest impact on the Company Goal(s)? Which Company Goals do your priorities map to? How will you measure of success? (Quantitative>Digital>Qualitative) How will you know you are winning? What are the critical dependencies (think about other teams you are dependent upon...are they setting aligned goals)?

Updating Goals Weekly

2. Predict Performance Weekly Every week, every employee updates their goal status: Example timeline Individual Contributors – 10:00am Friday Managers & Directors – 5:00pm Friday Executive Leadership – Before Monday morning Weekly updates include: How likely are you to achieve this goal? How do you feel about the quality of work done so far? Comments on progress, barriers, other concerns Managers can see the status of all child goals while updating their own. In just minutes provides complete, up-to-date status on all goals with company-wide transparency

Why ask goal owners for likelihood and quality instead of % complete? 2. Predict Performance Weekly Why ask goal owners for likelihood and quality instead of % complete? Hint: The goal is to develop into a “predictable” organization.

2. Predict Performance Weekly % Complete - Historical - Data centric; destroys/spreads accountability - Destroys trust by asking for data so manager can interpret Likelihood - Forward-looking - Insights centric; creates personal accountability - Demonstrates trust for each employee by asking for their insight

2. Predict Performance Weekly In his acclaimed study “The Iceberg of Ignorance”, consultant Sidney Yoshida concluded:  “Only 4% of an organization’s front line problems are known by top management, 9% are known by middle management, 74% by supervisors and 100% by employees…”

Transparency: Everyone can see your update and comments in Khorus

Run Efficient: Use Khorus to run the business

3: Run Weekly Team Meetings Discuss these!

3: Run Weekly Team Meetings A Performance Dashboard shows the status of all goals linked to a higher level goal Discuss issues (reds, oranges, yellows) and decide on course-corrective actions - re-prioritization? resource re-allocation? Review dependencies - which other goals may be at risk? Decide on any needed course adjustments Review trends - compare last week’s dashboard to this week’s; are things moving up and to the right? What can be done to nudge things in the right direction? Assign Actions and Follow up – assign action items in Khorus and ensure that agreed course corrections are taken, new resources are allocated, extra support is applied, etc.

Your role as a leadership team Get your goals into Khorus early (usually before quarter starts). Help your team create goals (and then approve them quickly). Expect weekly goal updates from every employee. Show the team your commitment by consistently providing your own updates. Use your team’s insights to operate the business. Run your weekly meetings using the Khorus Performance Dashboard. If anyone “raises their hand” (via a Red, Orange, Yellow), help them get their goal back on track. Model “healthy” coaching behavior (i.e. a “red” isn’t always a poor reflection of the employee)

Goal Setting Timeline Customize this based on CEO Kickoff meeting Determine key dates: Q1’17 Executive team goals entered and submitted for approval - ? Executive team goals approved by CEO – ? Khorus Performance Dashboards used in CEO staff meeting - ? Q2’17 Executive team goals approved by CEO - ? Rest Of Company (ROC) goals entered and submitted for approval - ? ROC goals approved by managers - ? Khorus Performance Dashboards used in every staff meeting - ? Customize this based on CEO Kickoff meeting

Khorus Demo Khorus home page Invite your team members Create a goal Update a goal Use the Performance Dashboards Misc

Resources Your Khorus Implementation Owner Periodic Emails from Khorus on how to take advantage of specific features Reading Product videos How I Use Khorus support@khorus.com Data for the CEO Khorus Help menu Khorus emails and in-app notifications Insert

Questions?

Executive Team Next Steps: Getting Started Accept your email invite Enter your weekly predictions for your goals Review Getting Started Resources Managers: Ensure direct reports are entering weekly predictions View the Company’s Goals this quarter Managers: Run your first meeting with the Performance Dashboard Work with your CEO to draft goals and enter into Khorus Managers: Invite employees to Khorus and discuss goals Contact your KIO for any assistance

Reminder – Selecting Quarters When creating new goals in Khorus, the platform always defaults to the CURRENT quarter. If you intend to create goals for the coming quarter, be sure to SELECT that quarter from the pull-down selector.

Feedback Please help us help you by taking the Khorus Exec Team Onboarding Survey …to be emailed in next few days

Thank You!