Have you heard about OKRs?
The ability to set goals is as challenging as it is fundamental. Even more challenging is the ability to measure how effectively those goals have been met. In this podcast Natalia Laskowska talks about setting and monitoring goals using the OKR methodology.
Have you heard about OKRs?
If you heard about it, you are in the right place to explore the topic even further.
If not – it is worth your while, as the goal-setting skills are as challenging as they are fundamental. Even more so is the ability to measure how efficiently these goals have been completed.
So today I’m going to talk about setting and monitoring goals using the OKR methodology.
But let’s start with a short story… where OKRs are coming from?
It all started in Silicon Valley when startups discovered what helped the companies such as Google, LinkedIn, Twitter to achieve their spectacular growth. These were OKRs! With great interest, more and more startups decided to adopt OKRs in their companies. They wanted to achieve the same success or at least catch its small fraction. But many of them struggled. Many companies failed to use them successfully… Maybe because they wanted to see results from day one? And OKRs implementation is a process… But! There is no question that OKRs work. The mystery is how to use them to get the desired results.
What actually OKRs are?
OKR methodology is a tool of objective-based management. While Management by Objectives is a whole goal and people management system, OKRs are its simpler version but, founded on the same principles.
OKR is an acronym, of course, it stands for Objectives and Key Results, where O is the goal we plan to reach. Here we answer the question like: What do you want to achieve?
And KR stands for key results. These are results that should help us assess how well our success has been achieved. Here we think of: How would you measure that objective if you made it? What numbers would move?
The combination of the ambitious objective and quantitative results creates a goal that is both inspiring and measurable. And these are OKRs. It’s a SMART goal, but also short and clear enough that every employee can remember and make decisions by it.
So it’s all about the goals but… not only. A great goal is a powerful tool, but we need something more. We need a way to ensure that the team lives that goal. The real power of the OKR system is figuring out how to live that goal every day, as a team. The point of this method is to encourage each employee to support strategic company objectives, while achieving their individual goals through their own work. Because OKRs are best achieved only when they are baked into our daily routine. That’s the secret.
So, how to go about OKRs?
We start off by setting OKRs for the whole company. Then department managers outline OKRs with their teams so they contribute to the company performance. Once department teams’ OKRs are set, each team member’s individual goals can be defined.
Sometimes, while talking about it, about the goals, people may think: why do we need OKRs if we basically set our tasks as goals and achieve results anyway by simply completing them, only in a slightly different way? Why should we change it?
One of the challenges I frequently encounter in companies while defining OKRs is mistaking key results for tasks to complete.
In the past, that was also something that me and my team had to work out when starting working on OKRs. Implementing OKRs as a new working tool requires a change in our style of work. We have to learn or get used to the way and the rules according to which OKRs are created.
We love planning things – don’t we? So, we tend to take the easy way and make to-do lists rather than come up with the goal and the results we want to achieve.
We often realize, though, that the things we plan to do don’t always lead us to the desired end.
And what if they don’t? Naturally, we have to look back and think over what else we could do to achieve the goal. We tend to forget that even though our particular task has been completed, we may fail to succeed because our key result is not achieved. Obviously, completing tasks is important in our work but we cannot call it our success unless the goal is achieved.
Remember – objectives are the changes we intend to bring about.
Key results are the measures of our success saying HOW we want to achieve our goals. And tasks involve actions we undertake to reach the goals.
Now… let’s try to think what we may achieve by implementing OKRs
First of all, companies decide to go through with Objectives and Key Results system in order to boost their effective execution of plans, which is nothing else than the strategy implementation. Very often it is one of the biggest challenges of many companies. The point is that the strategy and therefore the goals are simply unknown. We know that it always should be clear to people what the company wants to achieve and where the company stands now. But if it’s not communicated properly, there is no chance that people will know it .
It happens quite often that even managers are not able to name the company goals, let alone other employees. And if people do not know what is important to the company, they are not able to contribute to the effective goal achievement. OKRs are able to properly address this problem, so we can work and achieve our goals much more effectively.
What’s also very important, is that the OKR method facilitates cooperation and the fact that we all strive for the same. And this is due to the way of creating OKRs. These are people and all teams that should be involved in the process of creating OKRs. And that is much different from how the other goal-setting methods work. Moreover, It is often the case that some teams in the company are focused only on their own targets and are not interested in what is happening in the other teams. There’s no teamwork at all. It’s difficult to reach them, to talk to them, to work with them. In this case we are talking about the“siloses” – isolated teams that do not communicate with an another. OKRs can help us to remove the siloses, and work closely together to achieve common goals.
Moving on … the OKRs make it easier for us to choose the right priorities. Usually we have a lot of ideas, we think that everything is equally important and everything has to be done straight away …
Due to the fact that the OKRs allow us to measure what is important and based on that draw appropriate conclusions, we are able to focus on what will bring the greatest value to the company. And here is another important benefit: OKRs are not carved in stone. It is important to monitor them and update them as needed. Especially if we have not measured something before and we do not know what kind of results we can expect…So at the end of each quarter, we should look at what has been achieved and if necessary update the key results or sometimes even completely change the direction.
Another advantage is clear communication. In case of OKRs we call that: “The language of goals” – which is simple and therefore understandable for everyone. Thanks to this clear communication we can engage people, which we should definitely care about. This way, with this clear and transparent communication, we enable the team to understand the goals and priorities, as well as how each person can contribute. We ensure that everyone in the company knows why they work here, what they should do and what value their work will bring.
How else can OKRs prove useful?
OKRs mean more impact, involvement, engagement, empowerment…
The traditional model of setting goals is a top-down approach, meaning that the goals start at the top, are set by the management and then go down
In case of OKRs, it’s totally opposite. Defining OKRs, we start, of course, with the main, company’s goals, which must be consistent with the company’s strategy. Having the company OKRs, the teams get a clear direction and understand how they can contribute to reaching those OKRs.
Creating OKRs, we want to make sure that every person in the organization, through their work and achieving their own goals, support the implementation of the company’s strategic goals. At the beginning I said that managers need a way to ensure that the team lives the goals. That’s why we want to involve all the people in the OKRs creation process, so they can live these goals because they created them themselves.
If you still wonder whether your organization is ready to embrace OKRs – I’d say: any company is ready anytime.
Talking from my experience, you can only benefit from working on OKRs. And the benefits will surely surpass your expectations. Obviously, OKRs are not the only way to handle goal management. Yet, they are clear, user-friendly and therefore the most popular these days.
Don’t forget though, that the OKRs implementation is a process that takes a lot of commitment and the results won’t come overnight. Still I think it is definitely worth a try.