There’s nothing more important when managing a team than setting specific goals for them to work towards. These goals, however, come in vastly different forms.
Your staff can have trouble focusing on accomplishing tasks when one goal is set for the end of the quarter, one is waiting at the end of the week, and one is sitting on their desk. When you don’t have a process for setting these goals in an optimized manner, some will inevitably be left behind.
This is where OKRs (Objectives – Key Results) are vitally important. Created by one of management science’s founding fathers, Andy Grove, the OKR methodology is a strategy of aligning company goals with team goals in order to more easily achieve and measure progress.
The “Objective” is a mission with a wide scope, such as, “Expand our product to overseas markets”. You then underscore the objective with three to five key results that contribute to the objective, such as, “Identify and sign a contract with a top European retailer,” or, “Increase our international online sales by 50%”.
It’s essential that the key results are quantitative, with the ability to measure their progress and check them off as complete. Once your team achieves their key results, you’ll be a lot closer to completing your Objective.
It can also be a good idea for the Objective itself to be measurable; if it’s something like, “Secure 500 clients by the end of the year,” you can update the team on their progress and they’ll be able to see how their work towards the key results gets them closer to their long-term target.
The OKR method’s steady record of success is proof of its efficacy. John Doerr, disciple of Andy Grove and godfather of OKRs, brought the ideology to Intel and Google in the late 1990s when they were just two of countless tech startups in Silicon Valley hoping to explode. Here in 2021, Intel and Google likely power the computer you’re using to read this.
So, what exactly makes OKRs so much more effective than simply setting goals?
ENGINEERED FOR SUCCESS
At first, it might be easy to believe that any list of goals is close enough to a set of OKRs. However, there’s a significant difference.
As John Doerr wrote in his groundbreaking book on OKRs, Measure What Matters, “Ideas are easy. Execution is everything.” Your Objective is an idea similar to a goal, but the Key Results are what turn the method into a catalyst for rapid progress.
OKRs are engineered for success because they act as a ladder — you’ll be able to measure when the team completes a Key Result, and for each one they reach, they climb closer to their Objective. As they proceed, don’t be afraid to add more KRs as the team checks them off if you feel that the Objective needs more steps to become fully realized.
You may indeed have some smaller goals set in your office in service of a larger goal, but it’s easy to get Key Results confused with task lists. A good Key Result is, “Hire an intern for back-end development,” as opposed to, “Make a job posting on Indeed”.
The OKR method can turn what used to be a scattered list of tasks and morph them into a holistic mission towards progress. It’s perfect for businesses that have a long term, clear destination that should be held at the forefront.
OKRs are also ideal for those whose Key Results are evolving; if you track them with your employees, you can check them off as the team makes progress, create new ones and watch the list of completed KRs grow.
It’s great to actually have a physical tracker of your OKRs, whether online or on a whiteboard. This can be motivational for the whole company, as it provides an excellent visual of progress and energizes them to contribute.
JOHN DOERR’S “F.A.C.T.S.”
If you still aren’t sold on the benefits of implementing OKRs, John Doerr formed a list of the five biggest reasons to try them out. Appropriately, these spell, “FACTS”.
- Focus – Creating Key Results allows your team to direct all their focus towards completing their three or four most essential targets.
- Alignment – Once your workforce has funnelled their attention towards goals the organization has made priority, their aims and values will be linked with the company-wide vision, creating a more united front.
- Commitment – As OKRs are measurable and paramount in importance, the commitment to them is intrinsic. Committing to achieving them is promising to succeed.
- Tracking – With the numeric nature that Key Results often bring, tracking their progress is both essential and clear.
- Stretching – As Google’s Larry Page has said, “I’d rather have the objective be to go to Mars, and if we fall short, we’ll get to the moon.” Set your sights high; you might be surprised just how far OKRs can get you.
The reasons to implement OKRs are endless, and the testimonies to their success keep coming. More recently, Netflix and shoe company AllBirds have accomplished further goals using the method, and it’s spreading from industry to industry.
One of the biggest reasons for the method’s popularity is the fact that OKRs have the flexibility to fit in any environment while maintaining their structure and efficacy. You can implement Objectives and Key Results in any type of business, large and small, and find quantitative results.
It’s time to face the F.A.C.T.S. – introducing your team to the OKR system could be all you need to bring your company to the next level of productivity and success. Shoot for the stars and you just might get even farther.
For more on the history of goal setting and OKRs, check out what our CEO Tanya Bakalov has to say in her webinar on performance reviews and goals. For some examples of good OKRs in different industries, click here!