Using Objectives and Key Results (OKR) to Drive Growth

The rules of the OKR method help employees prioritize the outcomes of their work and measure them. Objectives need to be clear, challenging, inspiring, time-bound, and innovative. On the other hand, key results track progress. If you're just beginning to familiarize yourself with the OKR technique, strategy consulting will be of good use for you. Setting goals with OKRs is a question of balance between generating ideas and executing them. Your goal has to be ambitious but achievable in the desired timeframe. You can have many objectives, but they should also be aligned with your company's mission. While you'll need to set short-term, tactical goals, you'll need long-term, strategic ones too!

‍Furthermore, you'll have to keep your company employees engaged and train them throughout the OKR implementation process. Everyone in your company should be aware of the new strategy for achieving goals! Finally, regularly checking OKRs will help you see if new objectives and key results are necessary. In brief, using the OKR methodology requires preparing your company for the implementation process and having clearly-defined goals in mind. By encouraging all teams in your organization to align with the company goals, you'll avoid many obstacles on the way to corporate success. The OKR method can help you use resources thoughtfully to pursue your organization's mission successfully.

Google has long recognized how important teams and individual employees are for achieving corporate goals. One of Google's investors, John Doerr, told Larry Page and Sergey Brin about OKRs back in 1975. The company has been attributing its success to the method ever since! You can read more about Google's introduction to OKRs in John Doerr's book Measure What Matters.

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Google uses OKR to establish these four great elements for business growth: clear objectives, company-wide alignment to strategies, ongoing goal management, and an easy-to-follow plan. With OKRs, teams stay focused on important goals, and their progress is easily tracked. However, the company also stresses that OKRs have to be well done and managed to drive success. According to Google, objectives have to be aggressive, objective, unambiguous, and valuable. Key results need to describe measurable outcomes and not activities. For example, Key Results (KRs) that include words like 'help' and 'participate' describe activities, not results. Proof for the completion of KRs, like published metric reports or change lists, is also necessary.

Key Performance Indicators or KPIs help you track metrics related to your company's performance. On the other hand, OKRs are used to pinpoint the areas of improvement to drive change. In other words, OKRs show you metrics that reflect your daily work, and KPIs are valuable performance indicators. KPIs can tell you what your optimal performance level should be and which OKRs will get you there. While KPIs are led top-down, OKRs can be conducted both top-down and bottom-up. OKRs are more adaptable and frequently re-evaluated; companies don't usually change KPIs regularly. Furthermore, OKRs are fantastic for informing everybody about the changes you need to make to achieve the goals you've set. KPIs provide benchmarks and are great for monitoring the steady-state.

Corporative giants like Microsoft, Apple, and Amazon use the OKR model for greater client satisfaction and competitive advantage. OKRs are potent means of setting and realizing business goals. By using them, your company can have a clearer, more achievable mission based on realistic expectations. The effectiveness of OKRs lies in the methodology's premise, which is about obtaining a balance between challenging aspirations and realistic scenarios. This method increases employee engagement and aligns your teams' work with the company's collective objectives. As a result, the transparency between teams increases, and everyone's focus is improved.

‍We already mentioned some of the benefits of using OKR for business growth. Now, let's take a detailed look at how OKRs can help a company thrive.

OKRs help your employees understand how their work is connected to the company's mission. Once they have a clearer perspective on how they can help the organization reach its goals, they'll feel more involved in the process. They'll also be able to align their work with the company's objectives and focus on their true priorities. Because of the idea behind them, OKRs are usually evaluated and reviewed once a week or every two weeks. This practice helps teams talk about goals frequently and stay focused on them and the big picture. If their work activity needs some adjustments, changes can be done at the right time.

Thanks to their framework, OKRs foster efficiency and productivity within companies. They specify the measurements of corporate success and set a reasonable timeframe for the realization of goals. Regular progress tracking fosters informed decision-making and resource management. This, in turn, helps your employees differentiate between crucial and less important objectives, increasing productivity and showing what your teams need support with.

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No detail of an action plan should be overlooked because it can cost you your success, no matter how insignificant it seems. OKRs ensure that there's more transparency between leaders and their teams and between different departments accordingly. Because of this, employees can rethink even the slightest of their tasks and align them with the company's mission.

With OKRs, goal alignment, focus, and transparency become your company's top priorities. There are OKRs for literally every objective and mission! OKRs will let you achieve your corporate purpose faster, help your teams focus on their priorities, and have your employees follow through with their tasks. 

The next step in the process would be to imagine three to five key results for this objective. For example, one of them could be to have at least 2,000 people buying lipsticks from your new lipstick line in three months. When the time comes, you'll need to check if you’ve achieved the desired result within that time frame. Your second key result could be to upsell your product to 50% of existing customers. The third one could be to increase the lead conversion rate from 20% to 40%. Once you evaluate the OKR, you'll see how well you've achieved your goals and 'measure' your company's success.

When using OKR for business growth, you should be strategic with introducing it to your employees and how you implement it in general. Follow the next few steps for a successful implementation:

• Explain the concept of OKRs to your teams. Talk about objectives and key results, and encourage everyone not to feel afraid of ambitious goals but to see them as means of success.
• Define your OKR. It's best to set objectives with three to five key results at a company, team, and individual level while following the Specific, Measurable, Achievable, Realistic, and Time-bound (SMART) goals.  Make sure that your KRs are ambitious enough; if you think you'll hit them all, they're probably too safe.
• Have regular checks, and make some adjustments to the plan if needed. Public weekly check-ins are fantastic for gaining more insight into your teams' approach to OKRs. They're also an excellent way for your employees to clarify some things or for you to make the necessary priority shifts.
• Grade your OKRs at the end of each quarter. By doing this, you'll know how successful your team members have been in achieving their goals. Encourage your team leaders to have one-on-one discussions with their team members to talk about what's been achieved and what could be improved. The more feedback you get from all of the employees individually, the more your company will grow.

Remember to keep your objectives short, simple, and clear with just a few key results. Avoid setting ambiguous or business-as-usual OKRs, low-value objectives, sandbagging, and not having enough key results per objective. Implementing OKR is a journey and not something that will happen overnight. However, by aligning, focusing, and engaging your teams, positive changes and corporate success are possible.