(This is Part 2 in a series on Management by Outcomes. In Part 1, I introduced the core principles. This article is about what it looks like in practice.)

I was competing in a BJJ tournament. These tournaments are loud. Multiple matches are going at once. Coaches are yelling. Teammates are yelling. Spectators are yelling.

In one match, I heard two voices. One was loud and confident, but the directions were wrong. The other was my actual coach, but less clear. It took too much effort to sort out the noise, so I ignored both.

In the next match, the head instructor coached me.

His voice was unmistakable. His directions were clear and specific. Out of all the noise, his was the only voice I heard. My fight became almost paint-by-numbers.

That is what good direction does. It cuts through noise and makes execution simpler.

Your direction has to make sense to people in the fight

Companies often set objectives and still fail.

Not because the objectives were bad, but because they never became clear enough to guide the people doing the work.

This is where many strategic plans fall apart. The priorities made sense in planning, but they were never translated into practical outcomes for the people who had to execute.

Peter Drucker used the term Management by Objectives. I think a clearer term for most leaders today is Management by Outcomes.

Because the real issue is not whether we can write objectives. It is whether those written objectives produce the outcomes the business actually needs.

For the sake of clarity, I use these terms this way:

Priorities are the few strategic things that matter most.
Outcomes are the concrete results each level must produce to support those priorities.

What a good outcome looks like

A good outcome has four parts:

Outcome: What result are we trying to accomplish?
Measure: How will we know we have accomplished it?
Who and when: Who owns it, and when is it due?
Guardrails: What must not be sacrificed to get there?

Most leaders make the mistake of setting a good-sounding target and stopping. It does not work because it is too vague to manage. Or success is undefined or not measurable. Ownership is unclear. Deadlines are fuzzy. Or there are no guardrails, so people can achieve the result while damaging something else that matters.

Outcomes should be waterfalled through the organization

When a company defines its strategic priorities and outcomes, each level from the executive team on down should answer this question:

What must my team accomplish so that the level above me can succeed?

For support functions, the question is a little different:

What must my team accomplish so the teams we serve can succeed?

That is the waterfall.

Each level stays aligned to the same strategic direction, but each level expresses that direction in terms of its own work.

Here is a simple example from construction.

Executive outcome

Outcome: Increase company net margin from 8% to 10% by the end of the fiscal year without increasing safety incidents.
Measure: Net margin improves from 8% to 10%.
Who and when: President and executive team, by fiscal year-end.
Guardrails: Do not increase safety incidents. Do not damage client relationships. Do not create short-term gains that weaken the business next year.

This cannot just be handed down directly. It has to be translated.

Operations Director outcome

If the executive team needs a stronger margin without sacrificing safety or stability, the Operations Director has to define what operations must accomplish to make that happen.

Outcome: Improve operational performance across projects through stronger schedule control, labor efficiency, and reduced avoidable rework.
Measure: Improve average project margin by 2 points across the portfolio while maintaining current safety performance.
Who and when: Operations Director, by fiscal year-end.
Guardrails: Do not improve margin by under-supporting jobs. Do not create quality problems. Do not solve one project’s problem by pushing chaos downstream to another.

Now the executive team and the Operations Director are aligned. But it can be translated even further down.

Project Manager outcome

The PM should not just say, “Increase company margin.” The PM does not have that level of control. The PM controls projects and needs an outcome that makes sense at a project level.

Outcome: Improve margin performance on assigned projects through better cost control, tighter schedule management, and reduced rework.
Measure: Increase average project margin on assigned work by 2 points.
Who and when: Project Manager, by the closeout of each project.
Guardrails: Do not increase safety incidents. Do not achieve margin by cutting necessary support, masking problems, or damaging subcontractor or client relationships.

And you can continue to roll this down to the superintendent and foreman.

Support functions need outcomes too

This is where many companies break alignment.

Support functions are often treated as overhead or as separate from strategy. They are not.

Accounting, finance, HR, legal, and similar roles do not usually sit in the direct operating line. But they still need outcomes that clearly support the same company priorities.

Otherwise, they create friction without meaning to.

It is very common for a company’s strategic priorities to get hijacked by a support department’s preferences, systems, or risk tolerance.

Instead, if the company outcome is improving margin without hurting safety or stability, the Finance Manager’s outcome might look like this:

Outcome: Improve the speed and accuracy of job-cost reporting so leaders can identify margin problems sooner.

HR might carry an outcome like this:

Outcome: Improve hiring and retention in critical project and field roles so operational leaders are not carrying avoidable staffing gaps.

This is one of the biggest blind spots in many companies. Operational leaders are expected to deliver strategic results, while support functions are measured on administrative efficiency or risk avoidance alone.

This is a mistake.

If finance only optimizes accounting, and HR only optimizes compliance and benefits, those functions may run efficiently while still making the business harder to lead.

What stays the same and what changes

Three things should stay the same:

Direction. Everyone contributes to the same larger result.
Guardrails. Nobody gets to win by hurting safety, quality, or relationships.
Accountability. Each level owns a real result.

Three things should change:

Scope. Higher-level roles tend to have broader outcomes and less frequent reporting cadence. Lower-level execution roles tend to have narrower outcomes and more frequent reporting.
Language. Each level should describe the result in the language of its own work.
Measures. Different roles need different ways of tracking success.

Why this matters

Most companies do not lack goals. They lack translation.

• The President knows what the company ultimately needs to accomplish.
• Operations knows what projects need to perform better.
• Project Managers know the project, their people, and the client.
• Finance knows they need clean reporting.
• HR knows they need to fill roles.

But unless those are translated into aligned outcomes, each level defaults to local priorities. Then one group chases margin, another chases staffing, another chases administrative efficiency, and another chases speed, without enough real alignment.

A simple test

To see whether an outcome has been waterfalled down clearly, ask:

Does this help the level above me succeed, or the teams we support succeed?
Would the person responsible for this outcome know specifically where they should be focused?

If the answer is no, rewrite it. Keep it simple and clear.

Management by Outcomes is not about creating more work.

It is about making sure everyone knows how to contribute by ensuring the right people hear one clear voice and know how to act on it.

In my next article, Part III in this series, I’ll discuss the eight common ways Managing by Outcomes tends to break down. If you are aware of these and plan accordingly you will dramatically increase your team’s ability to work together and achieve far greater results

Take good care,
Christian