What is OKR?
OKR stands for Objectives and Key Results. It is a goal system created by John Doerr, which was first adopted by Google and then many other leaders in business such as Spotify, Airbnb, and Twitter. OKR is also used by companies that aren’t exclusively digital, like Walmart, Target, and The Guardian. The purpose of OKR is to instill engagement as a way to meet realistic goals. OKR is different from other goal-setting methods because it is re-evaluated constantly. This reevaluation allows organizations to generate alignment, the top OKR benefit, which ensures that everyone involved is on the same page and working towards goals in constructive ways.
The general formula for OKR is: “I will ____ as measured by ____. According to Doerr, goals should describe what you will accomplish and the way in which you will measure what the goal achieves. Basically, “as measured by” are the words that turn a desire into a goal, because it is expecting to see measurable results. Keep reading to learn more about OKR and the many benefits it offers today’s business teams. Read examples here of OKRs in their ideal format.
OKR has two parts: Objectives and Key Results.
Objectives are statements of what you want to achieve. Make them motivating to the team.
Key Results are the metrics you use to measure your goal as it is in progress. You want a total of two to five Key Results. If you aim for a number greater than 5, it will be difficult for people to remember them. Since you are working with a team, keep it simple, and maintain a short number.
Objectives are qualitative descriptions and Key Results are quantitative measurements.
What are the Benefits?
The collaboration of team members with goals and activities increases productivity and decreases the amount of time it takes to achieve company objectives.
In addition to team alignment, team flexibility makes it easier for adjustments and changes to take place during a goal cycle. Since OKRs use shorter goal cycles, it’s much easier to reduce risks and adapt to changes. Maintaining shorter cycles reduces planning time, allowing more flexibility in the amount of time it takes to accomplish the goal completely.
Alignment and review as an ongoing process allow employees to feel like they are truly contributing to their organization. Personal contributions create feelings of motivation, commitment, and interest in achieving group goals. Employee engagement is a difficult achievement for most businesses, explaining why statistics show that the greater the engagement, the higher the job satisfaction is for most workers.
OKR is an effective goal setting system, but it takes time and effort to implement it effectively. There are many free tools available to help companies adapt to the method. It is important to remember that a reasonable goal for one company may not be possible for another. Start slowly and work your business up in status. Practice makes perfect, so get going.