Welcome to our introduction to OKRs (Objectives and Key Results). By reading this guide you will discover the power of this goal setting methodology and how OKRs can transform your team’s performance, drive results, and help achieve the company goals that will win the battlegrounds outlined in your company strategy.
Ready to learn more about OKRs now?
We have written this guide as an introduction to OKRs for leaders, managers and employees new to OKR, or for those that are struggling to implement OKRs or what we hear described as “making OKRs stick”.
OKR is a popular goal setting format that stands for Objective and Key Results. The OKR acronym uses an Objective (the O) to describe that needs to be achieved, and a selection of Key Results (the KRs) to describe the measurable outcomes that when achieved would result in the objectives success.
The OKR framework can be used to set goals that are likely to move-the-needle. By using OKRs you will be measuring what matters, and be able to frequently track the progress of individual OKRs and OKRs grouped by strategy, department, team or individual. From this you will discover the areas of the business that needs support.
Using the OKR framework to set goals will help to improve clarity of purpose, alignment of efforts, and efficiency of resources within an organization.
Some key benefits of using an OKR system include:
This guide to OKRs will take you through the process of implementing OKR’s into your organization, from getting started all the way up to using metrics to measure performance.
There are many benefits to using the OKR methodology, which is why they are growing in popularity among organizations. Some of the top reasons to use OKRs include:
This simple graphic explains how to write an Objective. You only write one Objective per OKR. You should write a supporting narrative with your Objective explaining why it’s important to make progress on this OKR and why it was chosen.
With each Objective you want to write 1 – 4 Key Results, 2 – 3 is most common. These Key Results are the measurable outcomes you’d like to achieve by the end of a period like a quarter. They are often KPIs and ideally are leading indicator bias as lagging indicators move too slowly. You can also blend leading and lagging, trying to act on the leading indicators to drive the lagging one.
The work or what are often called Initiatives are how progress on the Key Results is going to be made. Initiatives take many forms and can be as large as a project, a sprint or epic, a campaign, a launch, or even a collection of tasks. It’s common to brainstorm a list of Initiative ideas as part of the OKR writing process.
As far as an Objective is concerned, it must pass a number of tests:
Most Key Results use two different measurement formats:
The success of your Objective depends on two factors:
There are lots of different labels for Objective and Key Result difficulty. Aspirational is often used to describe an OKR that’s a stretch but not a moonshot and progress should reach 70% (note that Google use 60%). The expectation of Committed OKRs is that progress should reach 100%. A moonshot is often used to spark innovation and progress of 30% or more could still be game- changing.
It is also useful to be able to track progress of OKRs in OKR groupings and branches.
OKRs are not going to replace your need for KPIs. In fact, there is a significant synergy between KPIs and OKRs that you will want to unlock. A good way to think about and approach unlocking this synergy is to track a small group of KPIs (Key Performance Indicators) in each team. This acts as the scoreboard for teams performance.
OKRs can then be set to answer the question: “What do we need to make progress on most this [year/quarter]?” Sometimes the answer lies amongst those KPIs, sometimes it doesn’t.
If progress is made on OKRs, your KPIs scoreboard should also make progress and look healthier. This is why ZOKRI allows you to have company, department, team and individual KPI and OKR scoreboards running alongside each other.
OKR (Objectives and Key Results) are nearly always made transparent. This means that you can see the company OKRs as well as departmental and team OKRs. Personal OKRs are going to have a more limited audience i.e. managers and HR.
Most people find this transparency refreshing. Especially if they are used to working in silos and never really knowing what is going and and how teams are performing.
Objectives, Key Result and KPI ownership also increases accountability. When your name is next to an OKR, Initiative or KPI and they are transparent, you’re more likely focus on them.
There is also peer pressure at play. When Objectives, Key Results and KPIs are part of checkins and meetings you do not want to turn up to team meetings having not worked the areas you own and have committed to making progress on.
We’ve more reps and their diaries need more sales appointments. We also have revenue targets we need to support.
Team: Content Marketing
We’ve already proven that this is the best way of scaling leads fast. We’ve a great team and we can make this type of content easily.
OKRs when used well are the focal point of some the best discussions and thinking you will do. Considering what your Objectives are in addition to what your Key Results should be will be the catalyst for better team work, innovation and learning.
You should therefore consider OKR to be a framework that leaders use to optimize business operations for the benefit of all stakeholder – shareholders, customers and employees.
You will also find that OKR implementations rely heavily on specific cultural values, behaviours and rituals. This is where OKR and Culture Management comes in and why ZOKRI offers both together. OKRs if embraced fully can improve your culture and make it more aligned to what would be considered a high performing culture.
The benefits of OKR and an OKR tool are numerous. The benefits to a leader of a company are obviously different to a more junior member of a team. The themes that OKR benefits fall under have a pattern though.
Follow these OKR best practices to unlock the value of OKRs
Set team goals that focus on your strategic pillars that are wildly important and need progress to be made now, because BAU / everyday goals won’t move the needle, but will dilute focus.
Write OKRs based on your org. structure and in cross-functional teams, and make them transparent, because siloed teams and invisible goals are obviously a terrible idea.
Unlock bottom-up thinking, because leaders often don’t know best! Research OKR examples and start thinking about your own.
Make a measurable impact by acting on measurements that matter, which are often lead and not lagging indicators – the big lagging like Revenue and NPS make average goals and much better KPIs.
Separate desirable and measurable outcomes, from the work that achieves them – your to-do list is valuable, but not a goal. Know the types of OKR you’re using.
Commit to discussing goal and execution progress frequently, ideally weekly. Set-and-forget goals lead to mediocre performance. The best OKR software manages this.
Set time aside to consider how you did and what you learned, learning is a measure of success as well.
Commit to a culture that encourages the sharing of ideas, questions, concerns and mistakes. Make it clear that speaking up and taking risks will not negatively impact self-image, status, or career.
Quick meetings to talk about plans and any issues.
The story of final OKR % progress and what it really means. The highs, low and learnings. When ready, agree the final, fair and balanced grading of success and decide to continue, or not.
If you’re looking to implement OKRs in your company, here are a few tips to help you succeed:
Objectives and Key Results are an important tool for setting goals, tracking progress, and creating a more successful company. OKRs help to align teams around shared objectives as well as provide feedback on performance.
With this guide to OKRs, we hope that you have now gained a better understanding of how OKRs can benefit your organization and the best practices for implementing them successfully.
We wish you all the best in achieving measurable results with your OKR strategy!