Inputs, outputs and outcomes
When we set goals or seek to track success, we need a framework for how to connect what we work on (projects) to their success criteria (KPIs) to their business impact (goals and objectives).
Getting clear on our definitions of inputs, outputs, and outcomes can help cross-functional stakeholders get onto the same page and give structure to our project working sessions, our tracking and update reporting, and connect our work back to our company’s quarterly and annual goals.
When we think about our work in these terms, we can understand how to create and measure leverage. And connect teams and projects back to high level goals and strategy.
Inputs are the raw materials and the deliverables, tasks and project milestones that we track along the way. We need to consider inputs to be our units of work. We seek to complete them on time, and at high quality. But they are not intrinsically valuable on their own. When we complete work on time and at high quality we are meeting expectations; but we should not consider any of that to mean we have achieved a goal.
Fight hard during goal-setting against 0/1 completion goals; these are inputs, not outcomes. Ask instead what KPI will move as a result of the completion of the task and what business impact that KPI movement will drive.
Outputs are what happens when the inputs are on schedule and as anticipated; these are measurable and are generally expressed as team or company KPIs. Outputs are tracked in your dashboards and should be part of your monthly review process.
In an OKRs framework, Outputs = Key Results. Every Output or Key Result must be already tracked, or easily trackable. Don’t fall into the trap of defining outputs or key results that are not measured or not easy to instrument in your telemetry.
Outcomes are the impact that moves the forward, when outputs move in the desired direction. Outcomes are directly connected to customer value; they are often confused with outputs (like revenue, or user growth) but those inward facing metrics are not real outcomes. A company must define its outcomes not from the perspective of its own growth but in terms of the success of its customers.
In an OKRs framework, Outcomes = Objectives. They must be defined in terms of customer value. Avoid the mistake of defining your outcomes in terms of your company’s key metrics or valuation. Think instead about what lasting impact you will make in the world and for your customer.