In a world where so many different business acronyms are utilized to the point where you want to BYHOYK (Bang Your Head on Your Keyboard), there’s one acronym that's now making its way into the mainstream that’s worth knowing: OKRs.
What are OKRs?
OKRs stands for "Objectives" and "Key Results" and it’s a strategic goal-setting methodology many of the fastest-growing companies on earth use to align and execute strategy. Using OKR effectively can workers much more purpose-driven, by improving focus by clearly outlining the priorities. Other benefits include better employee engagement, increased visibility, and better connectedness across the organization. Proper execution of OKRs can result in a dramatic shift from output-oriented work to outcome-oriented achievement.
What are objectives?
Objectives, or the “O” in OKR, are short, qualitative explanations of what is to be achieved. They should always be meaningful, memorable, and motivational. A good Objective sets a clear destination and primes the inspirational pump for the whole team. They should also be ambitious but realistic in a way that enables your team to stretch capabilities to reach monumental achievements.
Objectives on their own are untethered. If your Objective is to “Generate enough qualified leads to where the sales team cries UNCLE!,” you still need additional components that tell you when you’re getting it right and on track. Objectives by themselves don’t dictate whether your shots are hitting the mark, and that’s where Key Results come in.
What are key Results?
"Key Results" (the KRs) are the measurable component of OKRs. They serve as quantifiable benchmarks that monitor how you are progressing towards your Objective. A good Key Result is numerical and unambiguous. If it does not have a number, it is not a Key Result. Ideally, if you hit all of your Key Results this means you have achieved your Objective. Nice work! Achieving roughly 70% of Key Results would be considered a success for most OKRs, as they are supposed to stretch your capabilities - not be "sandbagged" goals.
Where did okrs come from?
OKRs are famously used by Google, but it was originally pioneered by Andy Grove while working at Intel in the 1970s. John Doerr worked there at the time, and later became the primary evangelist on the OKR methodology, even writing a book about them. Now, many other companies use OKRs, including Spotify, Twitter, LinkedIn, and Airbnb. OKRs aren’t just for tech companies, though; Walmart, Target, The Guardian, and ING Bank also adopted the goal management framework.
How do OKRs work?
OKRs are pretty simple in practice. First, the company’s overarching mission should be translated into an Objective. It should be easy to state in one sentence, such as “Deliver exceptional OKR experiences to customers.” Key Results can then be identified from that company-level Objective. In this example, “Get 10 million active users on our OKR platform” and “Renew 100% of existing customers” would make excellent Key Results.
OKRs are bidirectional, meaning they don’t always “trickle-down” from the top to the bottom of the organization. After a primary company OKR is clarified, each team in the organization can implement its own, typically quarterly, OKRs that align with it, depending on how you are structured. When tracked over time, OKRs can be fine-tuned even more often, allowing individuals and teams to update their tactical OKRs to reflect changing conditions and continuous alignment.
Work to accomplish team-level OKRs commences based on what each team believes will have the biggest impact. Teams will compare these initiatives to their corresponding Key Results at least once each quarter. If the initiatives don’t move the needle, it’s time to re-examine them. By separating OKRs (the goal) from the actual work (the initiative), you can keep them from becoming needlessly intertwined. This makes it easy to focus on the same goal while remaining flexible in your approach.
OKRs can be used by any company or individual, the key is to first TRY them but stick to them. Like anything else meaningful, properly executing OKRs isn't easy and requires commitment, dedication, and a willingness to try (and likely fail) at new things. They push the boundaries of our ability to try and achieve new things. They challenge the status quo and are the antithesis to complacency. OKRs are all about growth - for companies, teams, individuals - perhaps even more mankind.
How TO GET STARTED?
Start with one! Whether you are an executive, team leader, or just inspired to achieve something personally, write down your Objective! It can be written on a post-it note, tracked in a spreadsheet, or managed in a dedicated tool. From there, think about the measurable ways in which you can track progress. Ambiguity is the kryptonite of OKRs, so be specific! Learning along the way is often equally as beneficial as achieving the ultimate Objective. It's the reason why the "journey" is often more important than the "destination."
If you're looking for larger-scale training or technology, connect with us today and we'll work with you on an implementation plan for an operationalized OKR program for your business.