OKR (OBJECTIVES AND KEY RESULTS)

OKRs: Meaning & The OKR Process Explained

What Is OKR?

OKR is an acronym, with OKR standing for Objectives and Key Results. The OKR framework or methodology has been used to set goals by companies of all sizes since its inception in the 1970s at Intel, and later at Google.

The meaning of OKRs is simple: You pair a single Objective that describes what you need to make progress on during the next planning cycle, which is usually a year or a quarter, with what are usually multiple measures of success, that are called Key Results. The Key Results need to be achieved in order to achieve the Objective.

The purpose of OKRs is more interesting. OKRs have the greatest impact on a company’s performance when they are used to set goals that align with a clearly articulated strategy. This detail often gets overlooked and when it does the impact of the goals that are set gets diluted massively.

In this article we explain the OKR process in full, how to plan OKRs in a way that follows OKR best practices, and then how to track OKRs in a way that keeps everyone focused on achieving the outcomes described in the OKR format.

How To Plan OKRs

OKR Planning: Why You Need To Follow A Proven OKR Process

Assuming you have a clearly articulated strategy using concepts like strategic narratives and KPI scorecards, which we show you how to use as part of our FAST Transformation Toolkit, you are in a great position to start OKR planning.

OKR planning should start by having teams debate this question:

To execute the strategy: “What do we need to commit to and make progress on next?”

What will you notice when you ask teams that question? You will notice that the OKR format that can confuse those new to this way of writing goals stops being a hurdle and the narrative of the OKR becomes way more important – you want to capture the narrative. The debate can then be codified using the OKR format of an Objective and Key Results.

These are the OKR process steps we recommend you use:

Brief
Propose
Debate
Agree
Commit and Resource
Assign Ownership
Establish Weekly Execution Rhythm – Progress, Issues, Priorities
Start OKR Tracking & Reporting
Conduct Learning Focused Retrospectives

Good OKR planning processes and software like ZOKRI operationalize these steps as they prevent a number of common issues that can actually do more harm than good.

If you’d like to learn more about the OKR process and how to write OKRs, inside our FAST Transformation Strategic Planning Toolkit you will find a step-by-step OKR tutorial video and a downloadable OKR PDF guide you can share amongst your team along with an clever OKR template with completed OKR examples. The OKR examples use common Objective and Key Result patterns. The OKR examples we have provided also show you how OKRs can align or cascade from strategy to a distributed multi-goal roadmap that sets you up for success.

Learn How To Establish & Follow An OKR Process As Part Of The Workshop Toolkit For $800

Ask Us Questions

OKRs Have A Simple Structure

In learning to write and manage OKRs, if you’re not careful you can find yourself down rabbit holes and get the impression that OKR are complicated when OKRs are actually a simple and structured way to write goals.

The best OKRs are created through a series of discussions. The debates are trying to uncover where the biggest improvements need to be made. The OKR then describes a future end-state that is meaningful, measurable and will change frequently enough to track. Nothing more and nothing less.

Your Objective – What do you want or need to make progress on, why and why now?
You Key Results – Which measurements (1 – 4), if achieved would meant that you have achieved the Objective?

John Doerr, who introduced OKR to Google, uses a simple way to express how you should write OKR.

OBJECTIVE: I will: E.g. Grow our Product Range

KEY RESULT: As measured by: ____________________

Examples Of Objectives

Describe the change the company or team needs to achieve to support the strategy in the next planning and execution period e.g. a quarter
Write it a little like a Mission Statement for a Year or a Quarter that describe the challenge / opportunity and try to be positive or even inspirational
Be qualitative and not quantitative – that’s what Key Results are for

Financial Objective Examples

Increase profitability so we can re-invest more in growth
Diversify revenue sources so we are more resilient to change
Reduce the Cost of Production so we are more price competitive

Customer & Product Centric Objective Examples

Increase levels customer of satisfaction as this is the foundation for growth
Launch a new product that customers clearly value and prefer
Achieve Product Market Fit so we can fund growth
Deliver customer value faster and usage and revenue will grow
Increase customer choice and we will grow AOVs and order frequency
Lead the way on price and sell way more
Proactively provide support and deal with issues faster
Be seen as trusted advisor and business partner
Be the ‘go-to’ company for X
Provide more opportunities for customers to grow and we grow
Be considered a long-term partner
Build deeper relationships with customers so we know how and when to help
Provide expert guidance when needed
Understand customer needs and we can help them succeed

Process Centric Objective Examples

Make our complicated reporting process simple
Improve target account selection process to sell more
Improve Marketing & Sales alignment to drive more sales
Expand into new territories to grow our sales
Strengthen Key Account relationships to remove high value churn
Improve management of Risk & Compliance
Create a plan for fast full system recovery
Use technology to improve efficiency of X
Improve the Procurement Process to we have the best suppliers
Make distribution more efficient so we improve margins
Gather and share customer insights systematically

People & Learning Centric Objective Examples

Company-wide continual learning and development helps everyone succeed
Make high levels of Psychologically Safety a company-wide standard
Make goal, role & executional plan clarity a given so we know how we all succeed
Ensure all of the work we do has a know impact
Make appraisals a positive experience
Help our managers become multipliers and never diminishers
Provide wellbeing support to those that need it
Compensation & benefits are fair, consistent and competitive

Pair Your Objective Statements With A Longer Explanatory Narrative

We strongly recommend that you pair your short and easy to read and comprehend objective with a short narrative that explains why you chose the objective, why it’s important and urgent, and potentially what it is supporting and how.

Why is it important to also write an Objective narrative? Because OKRs are meant to be transparent and understood by everyone. We show you examples of Objectives and paired narratives as part of Step 5 of the Fast Transformation Toolkit.

If you choose to also build the writing of Objective Narratives into your OKR process you can do that in the ZOKRI Software easily and we strongly recommend that you do.

Key Result Examples

Key Results Are How You Track Progress & Know If Your Objective Has Been Met

Metrics / KPIs Make Great Key Results

Key Results that are trying to improve metrics make great Key Results. The debate then becomes about which and how many metrics to measure, and what the target values should be. We will discuss Key Result difficulty and OKR grading in a moment.

Increase [METRIC /KPI] from X to Y
Reduce [METRIC /KPI] from X to Y
Keep [METRIC /KPI] above X
Keep [METRIC /KPI] below X
Keep [METRIC /KPI] between X & Y

Give thought to how the target is achieved as well. If you are trying to increase a KPI to a target value, is success measured by:

The metric value at the end of the year or quarter
The sum of the weekly or monthly value updates
An average of the weekly or monthly updates across the year or quarter

Add Ambition By Design To Measurable Key Results

There are two ways to build in ambition to Key Results. The first is to use labels like ‘Committed’ for targets you need to hit and Aspirational’ for targets that are a stretch and if you fall a little short, that’s still a win. The other is to set two targets a Committed and an Aspirational. The approaches would make Key results look like this:

Increase [METRIC /KPI] from X to Y (Aspirational)
Increase [METRIC /KPI] from X to Y, or Z (Aspirational)

Why Should Key Result Targets Be Hard?

There is over 35 years of research on goal setting that beyond telling us what we know, which is goal setting is an essential part of achievement, the research tells us why goal setting works and the conditions that make some goals way more effective that others.

Goals increase our focus on the relevant activities – Goals serve as a directive function. They direct attention towards goal relevant activities, and away from irrelevant ones.
Hard goals prolong effort – When employees can control their time, e.g. they work remotely, hard goals prolong their effort, with sustained effort helping to achieve more.
Hard goals increase effort – Hard goals are energising and lead to greater effort. Easy to achieve goals have low levels of impact and value so should be avoided.
Hard goals accelerate learning & improved collaboration – Hard goals cause the arousal, discovery and use of task relevant knowledge and strategies. Easy goals don’t.

Milestones Can Work As Key Results As Well

If your Objective is to achieve specific milestones in a period then your might set-up a Key Result that looks like this in ZOKRI. This type of Key Result could easily be a To-do as it’s an Activity / Project.

Open New Office Location

0% Start
5% Propose Region
10% Agree Region
15% Propose Location
20% Agree Location
50% Hire Region Head
70% Acquire Office
80% Hire Team
100% Up & Running

The definition of what success looks like for Milestone Key Results is a little more complicated as it might be Hard to achieve but unlike KPI based Key Results, 70% might not be a good result. So if you do want to use Milestones as a Key Result and not a To-do, where possible we would recommend setting the difficulty as Business-as-Usual, where 100% is the definition of success.

Binary Key Results

There’s no rule that says Key Results can not be binary – either done or not done. It is however hard to track progress between weeks. In early stage companies where you’re learning curve is steep and your KPIs maturity is low these are often used for Key Results that are targeting and discovery and learning.

Activity Based Key Results

With Key Results, where you can you want to be measuring outcomes not effort. This means you’re measuring a ‘metric’, not your means of achieving success.

Best-practice guidance is that if you’re doing an activity that involves: completing, defining, providing, helping, developing, launching, planning, creating, delivering, building, implementing, releasing, or launching, then this might be better denied as an Initiatives. Initiatives can have more flexible due dates that can be within a period or extend beyond the standard OKR planning periods. Which is common for activities.

Mixing It Up Can Create Great OKRs

There is no rule that says you can’t use a number of the Key Result types in your OKRs. For example:

Objective

Wow customers with a next generation pet insurance app.

Key Results

Pinpoint the pain points and friction is in the current buying process (Learning)
Solve these pain points in a new app by the end of Q1 (Project)
Generate over 1,000 quotes (Metric)
Achieve an CSAT score over over 8 (Metric)

This OKR might be used to unify a cross functional team involving Marketing, Product Management and Engineering.

You could also choose to turn the Learning and Project based key Results into Initiatives. Here’s a bit more about how that can work.

How To Reveal Possible Measures To Use In Key Results

If you are using Key Results that involve:

Completing
Defining
Providing
Helping
Developing
Planning
Creating
Delivering
Building
Implementing
Releasing
Launching
Etc…

Success probably means completing projects and tasks. A good question to ask yourself is:

Which metrics / KPIs would be impacted as a result of delivering this project or task?

What Would Be The Desired Measurable Outcomes?

If we ‘build’ the new feature we ‘think’ we will:

Increase Weekly Active User from X to Y
Increase Free to Paid Conversions from X% to Y%

If we ‘launch’ a campaign we ‘think’ we will:

Increase Organic Traffic from Paid Search Keywords by 20%
Generate 1000 downloads
Generate 200 MQLs for Sales

If we ‘complete’ the re-platforming of our tech we ‘think’ we will:

Increase Story Points Per sprint from X to Y
Increase release frequency from X to Y
Reduce Customer Reported Bugs from X to Y

OKR Tracking Is A Key Part Of The OKR Process

You might have noticed that OKR tracking is a key step in the OKR process. OKRs that are not worked towards from week-to-week are less likely to be achieved. OKR tracking is one of the ways we hold ourselves accountable to what we committed to try and achieve.

What complements OKR tracking is transparency. When our colleagues can also see how we are doing, we are more likely to stay engaged and focused on making progress. We are also more likely to get support if there are issues, and praise when there is good news.

OKR tracking is a feature of ZOKRI with integrations with spreadsheets, tools containing KPIs and project management tools. Progress and the narrative of the update, that might include issues, can then be shared automatically via the app, email, Slack or MS Teams.

When you have your weekly meetings you’re not updating each other you’re planning together. Solving issues and setting priorities for the week ahead.

OKR Best-practices To Lock Into Your OKR Processes

OKR best-practices have slowly evolved over the decades and we are now in a position where they are well documented, easy to learn and build into your own OKR processes. We would like to share the top 5 OKR best practices that we think matter most if you’re considering adopting OKR methodology.

Have a strategy: The purpose of OKR is to provide a strategy execution roadmap and a means of tracking progress and solving issues from week to week. Without a clearly articulated strategy you’re going to set goals that describe less impactful things.
Break down silos: OKRs give you an opportunity to create cross-functional goals as well as single team goals. This improves collaboration and breaks down silos. We show you how to do this in our toolkit and how to mitigate the few risks associated with cross functional goal setting.
Less is more: OKR newbies nearly always set too many goals as opposed to focusing on the goals that should logically come first or next, be resourced and achieved. So the fewer OKRs you have the more likely you are to achieve them.
Make OKRs a habit: OKRs and the processes that turn a goal format into a growth catalyst, like check-in and structured OKR meetings in the early days feel new and they need thought. However after a few months they become a habit and they need little to no thought, they are just how you plan and manage growth.
Make ambition safe: OKRs are goals with an inbuilt paradox. They are often a little aspirational by design and therefore frequently not achieved fully. We tell you more about how to set aspirational OKRs and make sure learnings as well as achievement are celebrated as part of step 5 of the FAST Transformation Toolkit.

Hopefully you will agree that the meaning of OKRs has little to do with Objectives and Key Results. We’d actually argue that the meaning of OKR has more to do with providing meaning to the work we do to support our teams and company to serve customers, win against competitors and deliver value for employees and shareholders.

Read and learn more about the OKR Framework.

OKR Software

OKR Process Management & OKR Tracking & Reporting
As Standard

In addition to being a home for your Vision, Mission, Winning Aspiration, Strategy and KPI Scorecards, ZOKRI has class-leading OKR features that ensure OKRs are used correctly and make a material impact..