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Familiar – But With A Little More Goal Setting Best Practice Built-in
Just because you may not be familiar with the term OKR, doesn’t mean you are going to find creating them hard. Especially if you’re used to other ways of goal setting goals, like SMART for example.
So forget what OKRs are for a moment and consider what the characteristics of good goal setting are.
Firstly, goals are there to translate your purpose and strategy into specific, measurable, actional, reasonable and time constrained targets – sound familiar? These are often called SMART goals.
In this OKRs video we explain OKRs and their history, in addition to discussing best practices like how to write OKRs, how to create Key Results that ‘measure what matters’ and create OKR alignment.
The video works through simple example OKRs with how they are aligned between multiple teams This is often called OKR cascading..
It’s not that long and it’s a really easy way to introduce yourself to OKRs.
SMART Goals Get You As Far As OK Goal Setting
Great Goal Setting Has Other Traits
Measurable And Impactful
Measurement is not enough – what you need to be measuring is what really matters to the company, team or individual – the metrics or KPIs that correlate with performance.
Rounded And Balanced
Single metric goals can be too one dimensional and do not tell the story of what you need to achieve – grouped metrics can create a more rounded and balanced goal.
This means aligning team and sub-team goals that help the organization reach its goals vertically. Marketing into specific marketing teams like Paid Media for example.
This means your inter-team goals don’t conflict e.g. marketing goals generate sufficient lead volume for the sales goals to be reached.
Hard To Achieve
Hard matters because hard to achieve goals have been proven to have a significant impact on performance when compared to easy to reach goals that have zero net benefit.
Progress and other related information like the Status and Confidence need to be updated frequently, ideally weekly, along with Initiative Check-ins.
So we need SMART goals PLUS the high value extra traits to know that an organization, team or individual has set great goals.
This is where OKRs come in, and is what they were designed to achieve decades ago when they were introduced to Intel and then Google, when Google was a handful of people.
It’s also where OKR Software comes in as many of these traits are hard to represent, manage and achieve in spreadsheets. In addition, software can guide best practice without a big educational overhead.
What Do Good OKRs Look Like?
Obj – Revenue growth at the right cost
KR – Generate New Revenue of $100K this Quarter
KR – Keep our CAC under $150 Per Customer this Quarter
This example shows the benefit of being able to group more than one Key Result to describe the Objectives success.
It set’s out the revenue target for the Quarter but adds a condition to what the Objectives success looks like – customers have to be acquired cost effectively. Meaning you can’t buy revenue in an unprofitable way.
NOTE: You typically have 1 to 4 Key Results for each Objective.
Obj – Great content is helping us sell
KR – Generate 1000 Content Downloads this Quarter
KR – Leads from Content Sign-ups are converting to SQLs 20% of the time
Marketing has set a number of downloads, but that could be reached and not have an impact on the business. Perhaps the people downloading it are not your Ideal Customer Profile? So you pair it with a metric that would target quantity and quality
Initiatives Are The Key To OKR Achievement, Not OKRs
So what is an Initiative?
An Initiative might be as big as a project or as small as a task.
An Initiative has a target due date that might be shorter than the OKR Period or even extend beyond it.
An Initiative also has its own Status e.g. Stuck, as well as its own Progress, and Confidence levels.
It’s the delivery of Initiatives that deliver the OKRs. They are also the focus of daily and weekly meetings, within the context of the goal.
In Marketing they could be as big as completing the Black Friday Trello Board by the 27 November, or as small as creating an amazing white paper by 7 October.
In Engineering they could be as big as moving hosting from Amazon to Google as part of a drive to reduce costs by 15 November, or as small as completing a key feature for Sales as part of an Epic in the next Sprint.
These are all the units of work that teams have chosen to do in order to achieve the hard goals that are measuring what matters.
Because OKRs and Initiatives need each other and are critical to achieving your projects aims, ZOKRI has created class-leading OKR management functionality and workflows that help you gather the inputs you need in order to create essential OKR and Initiative insights. This sets us apart from other vendors.
We get to see great implementations of OKRs all of the time. We also get to help people avoid common mistakes so they get the full benefit of the OKR framework.
The four most common OKR mistakes are:
Tasks not Key Results: Key Results that look like tasks and are not constrained to the end of period e.g. Quarter.
Poor measurement: Key Results that don’t contain metrics or the metrics chosen are NOT true reflections of performance and success aka Vanity Metrics.
Too many OKRs: Good OKRs are like good strategy, focusing on fewer areas of maximum impact is generally much better that doing and focusing on everything – sometimes called focusing on ‘key pillars’ or ‘big rocks’.
Set and forget: If your OKRs are in a place where they are not part of your daily and weekly workflows they can be set and forgotten until the end of the month or quarter. Read more about OKR tracking here.