How to use the OKR technique to achieve business goals
The challenge of achievable and measurable goals
Many managers have experienced the frustration of committing to goals they don't really believe in. When targets are perceived as unrealistic or unattainable, it can be difficult to motivate teams and even harder to maintain enthusiasm and willingness to act. Traditional goal-setting approaches often prioritise quantitative measures over quality, resulting in goals that are achieved but fall short of their potential. If you and your company want to achieve ambitious business goals without being overwhelmed by objectivism and metrics, it's time to consider using the Objectives and Key Results (OKR) framework.
OKR framework, when created and implemented correctly, can have a massive impact on business and its strategic goals. According to the study, the overall performance of companies using OKR increased by 11% and sales raised by 8.5%.
The history of Objectives and Key Results
Organisations have always struggled to find unique ways to achieve their goals. In 1954, Peter Drucker presented his approach to goal-setting, called Management by Objectives (MBO). However, MBO was essentially just a static series of statements, lacking the detail needed to achieve goals. Fourteen years later, Andrew Grove, co-founder of Intel inspired by Drucker, created the OKR framework. OKR provided so much value to Intel that Grove decided to spread the framework to other organisations. He showed it to Google's founders, who quickly adopted it and have continued to use it since then.
How to set Objectives and Key Results
Setting OKRs should always begin with your business goals in mind. When selecting the objective, it's essential to consider the company's business goals and aspirations for success.
Set Objectives and Key Results
The objective is qualitative and should be inspirational, engaging, and challenging for everyone. Its primary duty is to point the direction for further development of Key Results, which are quantitative and illustrate the metrics that will indicate if you achieved your Objective. Remember, the OKR framework is not an action plan but the direction of the progress you want to achieve.
Not to struggle too much, here is the sentence that will dispel all of your doubts:
We will [Objective] as measured by [this set of Key Results].
Note that every Objective should contain from 2 to 5 Key Results. Here is an example:
O: Futureproof our systems that hold our products
KR1: Satisfy all 71 security controls
KR2: Improve our data quality by 85%
KR3: Improve product time to market by 50%
KR4: 95% of the staff is upskilled in the new technology
KR5: Guarantee uptime and availability of 99.95% on all customer-facing systems
When thinking of a timeline, it's up to you, your team or your organisation's capabilities. You can set OKR for a quarter, half-year, or a year. You can adjust it to your business needs and internal capacity. Keeping time bounds within short and tight timeframes boosts focus and allows you to review your OKRs regularly. You will quickly see what works well.
If you want to ensure your team makes essential steps in achieving OKRs, you may launch Initiatives. Essentially, they are not part of the OKR but can support you and your team in achieving business goals.
Follow the OKR principles
To ensure successful implementation, following the OKR principles when setting targets is essential. Refrain from treating the principles as opponents but as helpful assistants.
Set only ambitious goals
A goal that is easily achieved doesn't make an impression or generate outstanding results. Make your goals challenging and aspirational to awaken the fighting spirit in your team.
Make the goals simple and measurable
If you have nothing to measure, how do you know that the Objective was achieved? Ensure you can measure the results. The OKRs are straightforward and reflect the organisation's focus.
Make your OKRs visible to the organisation, from front-line employees to the CEO. Transparency leads to accountability and ensures everyone involved has a holistic view of the organisation's direction.
Learn from experience
Creating goals and targets is one of the most important aspects of a business that wants to scale and constantly improve results. The OKR framework has been used by world leaders such as Google, Airbnb, and Linkedin and has led them to where they are today. Don't be discouraged if you don't achieve your OKRs at 100% or even 50%. The real value comes from learning and experience, which you can use to improve your approach. Start your journey with OKR and unlock your business potential. Watch our OKR Agile Encounters Webinar if you want to learn more or join the deep dive masterclass - OKR workshop conducted by our trainers-practitioners.