In our previous article within the OAK'S LAB WAY series, we emphasized the significance of clear mission and vision statements. While it's essential for startups to have an inspiring purpose and aspiration, founders need a tangible way to measure progress towards their ambitions.
This is where business and product goals come into play. Often times founders come to us with poorly defined or even non-existent goals for their business and product. Common examples of misguided goals we've seen:
Though these objectives are important for product teams, they are output-based rather than focused on the overarching outcomes crucial to the startup's success. By identifying outcome-based goals first, some output-based goals may become irrelevant as more efficient solutions can be found to achieve the desired outcome.
Especially for early-stage startups with limited resources and short runways, it is crucial for product teams to stay focused on a limited amount of goals and prioritize the most impactful tasks that contribute to achieving them. In this article, we will delve into the differences between business and product goals, how we implement them at OAK'S LAB, and share some valuable tips from our experience building 35 startups.
Business goals are set at the organizational level and are aimed at achieving the overall mission and vision of the startup. They are broader in scope and cover all aspects of the business, including products, services, customers, employees, finances, and operations. These goals are typically long-term and drive the strategic direction of the company.
Product goals are product-specific objectives that focus on improving the product's value, quality, and customer satisfaction. They have a shorter time horizon and drive the tactical direction of product development efforts.
In early-stage startups, business and product goals may be identical to avoid unnecessary complexity. However, as startups mature, business goals set the overall direction and strategy, while product goals focus on particular product-specifc objectives. Both types of goals are important for a startup's success and should be aligned and coordinated to ensure progress towards the mission and vision.
At OAK'S LAB, our priority is providing a framework that ties all product development efforts to positive outcomes for the startups we work with. Clear goals help us stay efficient by prioritizing and maintaining our focus on the most impactful tasks.
Therefore it is crucial for us to make sure that on every startup project we are part of, we have clear goals that we are aiming to achieve. These goals then help us prioritize ruthlessly when we are scoping out new features and keep our team focused on the main thing.
We require all goals at for our startup projects to be SMART:
Business Goal Example: Achieve $1M in ARR within the next 18 months
This example has been taken from one of our seed-stage startup clients that was focused on increasing their ARR in order to raise their next funding round.
Product Goal Example: Reduce the average contract review time by 50% within 3 months
This example was taken from one of our pre-seed stage startup clients that was building a product to streamline the process for legal professionals to review contracts.
In conclusion, setting effective business and product goals is a crucial aspect of driving early-stage startups towards success. By focusing on outcome-based goals, founders can ensure their teams remain focused on high-impact tasks that contribute to achieving their overarching ambitions.