Objectives and Key Results (OKR) is an efficacious goal-setting methodology that enables the management to make data-driven informed decisions and also can bring huge results to the organization, if leveraged and implemented perfectly. Of course, perfection is a myth but near perfection is not. To attain that particular level, a company has to experiment with the framework.

Before getting deep into the concept, you have to answer the question, “Do you really need OKRs for your company?” If you answer yes after reading this blog, then go ahead with the process.

How to Set Objectives and Key Results?

Objectives are what you really want to achieve. For example, if your company wants to increase the customer retention rate from 80% to 95%, then that is your objective for the year or quarter. That is where the OKR in business comes into the picture. You can also repeat the objectives in the following years but remember that you should show some progress every year. If there is no progress, you are doing something wrong; It could be the result of ineffective key results. It becomes very important to deeply delve into what is OKR in business.

The objectives should not be some random desire of one superior in your company. They have to align with the company’s vision and mission and take one step forward toward ‘how do you see your company in 10 years?’ Be specific with your objective, and the reason for choosing that goal for your quarter/year.

Key Results are your little baby steps toward achieving your goal. The key results should be clear, numerically defined, and accountable. For instance, to increase the customer retention rate from 80% to 95%, you can set the key results, 

1. Create 2 whitepapers and 2 eBooks to provide solutions to the customers in your niche by the first month of the quarter and record the response. 

1. Make a call to every customer in the first week of May to inquire about their well-being and concerns regarding the product. The issues are to be resolved within two days and get feedback. 

1. With the available customer feedback, analyze the data and gather information about the hard-to-use parts of the product and the suggestions made. If that aligns with your company policy, make the changes in the product and send a mail to the customers by June 30, 2021.   

The above sentences are easy to understand and specific. You can also use trendy words in your key results to grab the attention of millennial employees. Every company should have a tailored process of setting OKR in business. This is one way to do it.  

How to Implement OKRs? 

In this current scenario, OKRs are much needed, and how to implement OKR in business. If the employees know their direction, no matter where they work from, they will keep moving forward, and that is the sole purpose of OKR ‘to keep you moving forward.’ Besides, OKRs keep the employees engaged as the team members know what is expected out of them and they will invest more in the work as they are held accountable for the work. Accountability shows employees that the management trusts them and would like to see more of their commitment.  

Cascading the Goals. When the organization decides on a goal after weeks of contemplation, the cascading process should begin. The department heads should be called for a meeting, and the OKRs should be explained to them. The department heads should set Objectives and Key Results (OKR) for the department and check if it is in line with the overall business objective. 

Then, the department heads should conduct a meeting with the team managers, who, in turn, set the goals for the teams taking the inputs of the team members, the frontliners of an organization. The team members know more about the demands of the market as they work in the field directly. Therefore, involving them in big conversations can really produce the needed results. 

 

Regular Meetings. Managers should allow the individuals to set the goals for themselves as the employees know their schedules and capabilities better. Later, the managers can suggest changes, if required, to maintain the alignment to the business objective. Besides, the managers should conduct regular team meetings or one-on-one meetings to discuss the progress and concerns of the team members regarding the goal. 

Effective communication is the key to make Objectives and Key Results (OKR) a great success. Transparency is also equally important to steer clear of redundancy and also to help one another with their available resources. Adopting OKR software with a powerful dashboard to get more actionable insights can further fuel the progress and increase the success rate of the organization. 

Benefits of Objectives and Key Results (OKR) 

Pitfalls to Avoid While Setting Objectives and Key Results (OKR) 

What do Great Leaders, who have Used Objective and Key Results (OKR) Say? 

“OKRs have helped lead us to 10x growth, many times over. They’ve helped make our crazily bold mission of “organizing the world’s information” perhaps even achievable. They’ve kept me and the rest of the company on time and on track when it mattered the most. And I wanted to make sure people heard that.” 

– Larry Page, co-founder, Google in Measure What Matters   

“People can’t connect with what they cannot see; networks cannot blossom in silos. By definition, OKRs are open and visible to all parts of an organization, to each level of every department. As a result, companies that stick with them become more coherent.” 

– John Doerr, Measure What Matters 

“Google stands for speed. The company has waged a constant battle against latency, the delay in a data transfer that degrades the user experience. In 2008, Larry and Sergey wrote a beautiful OKR that truly captured people’s attention: “We should make the web as fast as flipping through a magazine.” It inspired the whole company to think harder about how we could make things better and faster. 

For the Chrome project, we created a sub-OKR to turbocharge JavaScript. The goal was to make applications on the web work as smoothly as downloads on a desktop. We set a moonshot goal of 10x improvement and named the project “V8,” after the high-performance car engine. We were fortunate to find a Danish programmer named Lars Bak, who’d built virtual machines for Sun Microsystems and held more than a dozen patents.  

Lars is one of the great artists in his field. He came to us and said, without an ounce of bravado, “I can do something that is much, much faster.” Within four months, he had JavaScript running ten times as fast as it ran on Firefox. Within two years, it was more than twenty times faster—incredible progress. (Sometimes a stretch goal is not as wildly aspirational as it may seem. As Lars later told Steven Levy in In the Plex, “We sort of underestimated what we could do.”)” 

– Sundar Pichai, CEO, Google in Measure What Matters