The finance department can be the biggest ally for founders, business owners, and CEOs. Finance departments have to assess and gauge the expenses, revenue, and cash flow of the company as a whole. Consequently, they have to be accountable for analyzing the financial health of individual departments too.
Accurate record-keeping is an extremely crucial requirement too for the finance department. The department which accounts for profitability and revenue for the entire business demands utmost scrutiny.
This process is made simpler with OKRs. Finance departments are great candidates for the implementation of an OKR due to the requirement of extensive number crunching.
For the finance department setting team, goals can be tricky since it is not always clear how specific goals connect to the growth of the organization. They are often focused on managing cash flows or containing costs. For the financial goals to succeed it is necessary to be able to connect them to the broader trajectory of what the company is trying to do.
With the help of the OKRs, it becomes possible to join the dots between the bigger strategic goals of the company, the operational goals of the team, and the individual goals of employees.
Sample OKRs For Finance Department For Larger Organisations And Start-Ups
Objective – Create The Financial Strategy For The Next 3 Years
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| Key Result 1: Finalize budget by Q4 of ___________(current financial year) |
| Key Result 2: Raise Rs _________(amount of money) as seed funding by the end of the current financial year |
Objective – Establish A Network Of Venture Capitalists(VC) To Assist Funding
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| Key Result 1: Set up meetings with atleast 80 VCs by end of Q3 of current financial year |
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Objective – Finalize Budget For The Next Financial Year By Q4
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| Key Result 1: Meet all department heads to discuss the needs for the coming financial year in the beginning of Q4 |
| Key Result 2: Identify loss areas and reduce unnecessary expenses by atleast 70% |
| Key Result 3: Analyze market conditions and forecast budget by last week of Q4 |
Objective – Identify Which Company Products Are In Profitability In The Current Financial Year And The Reasons For The Same
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| Key Result 1: Compare with competitor’s products to arrive at the price difference by the end of Q2 |
| Key Result 2: Create a comparative chart of all the products of the company and determine which are the products with the highest saleability based on sales in Q1 and Q2 by the end of Q3 |
Objective – Increase The Efficiency Of The Bookkeeping Process
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| Key Result 1: Utilize advanced tools and techniques to eliminate errors |
| Key Result 2: Identify and hire qualified bookkeepers to keep up with the ever changing compliance norms |
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Objective – Create And Finalize The Accounts Payable Report By The End Of Q4
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| Key Result 1: Finish reviewing and approving departmental expenditures by the end of the following week |
| Key Result 2: Reduce redundant expenditures by 85% by the end of the quarter |
| Key Result 3: Review and complete compensation agreements by the end of the quarter |
Objective – Reduce Expenditure From Rs ___(Amount) To Rs ____ (Amount) By Q4 Of Current Financial Year
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| Key Result 1: Identity departments and processes where repeated losses have been in occuring in Q1 and Q2 |
| Key Result 2: Suggest at least 2 methods for reducing expenditure in those departments |
| Key Result 1: Identity departments and processes where repeated losses have been in occuring in Q1 and Q2 |
Objective – Reduce Tax Liability
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| Key Result 1: Increase tax-advantaged investment from 70% to 100% |
| Key Result 2: Decrease current liabilities from 40% to 25% by the end of Q3 |
| Key Result 3: Decrease depreciation cost from 40% to 60% |
Objective – Interact With All Departments To Achieve Indicated Financial Results
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| Key Result 1: Complete presentations to all departments by first month of Q1 to indicate current financial plan |
| Key Result 2: Interact with department heads regarding the budget for the upcoming year to discuss any issues/ roadblocks in the budget by the end of 2nd month of Q2 |
| Key Result 3: Reduce logistics cost by 25% |
| Key Result 4: Bring down purchase costs by 10% |
Objective – Complete Accurate Financial Reports
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| Key Result 1: Compile and deliver financial information to 3rd party consultants |
| Key Result 2: Review internal audit for process accuracy and optimization |
| Key Result 3: Coordinate with department heads for revenue projections. |
