Every year companies set high–level and productive goals. However, employees often lose track of these goals and contribute to passive management.
Enter, OKR planning. Today we will talk about OKR and why it acts as a backbone for organizational performance.
- 1 What is OKR?
- 2 What is the Difference Between OKR and KPI?
- 3 What Are Some Benefits of Implementing OKRs?
- 4 Team
- 5 Collaboration and Alignment
- 6 Improved Employee Engagement
- 7 Guides to Set and Achieve Stretch Goals
- 8 Encourages Accountability and Autonomy
- 9 Increased Flexibility
- 10 How to Implement an OKR System Within a Team?
- 11 Wrapping It Up
What is OKR?
Objective and Key Results (OKR) primarily refers to a goal management framework. It helps companies in implementing and executing diverse strategies. OKRs were invented by Andy Grove and popularized by John Doerr. This system outlines specific goals concerning the objectives that a team or firm is striving to accomplish. Additionally, it tracks measurable milestones for the key results that define the achievements of every goal.
OKRs have become a paramount focus for tech giants like Google, Twitter, LinkedIn, Spotify, and much more. But, you’ll ask what exactly distinguishes an Objective from a Key result?
An objective poses similarity to a destination on a map. It tells you where you want to go precisely in understandable and concrete terms. When working with a team collaboratively, these objectives drive the members to achieve them together. Key results refer to the metrics that assist the team in measuring their progress towards acquiring that objective. They have a start value and a target value measurable over time. Let us comprehend it in depth with the following example.
- Increase market revenue by 20%
- Acquiring 60 new customers
- Boost market leads by 20%
- Increase customer retention by 80%
What is the Difference Between OKR and KPI?
Comparing KPIs vs OKRs often remains a central plan in performance management meetings, but it is an apples and oranges discussion. There is no overlapping between the two terms.
KPI represents an acronym for key performance indicators. They are chiefly quantitative and utilized by teams for evaluating their progress within initiatives and projects. Classified as targets and metrics, the KPIs get expressed in numbers. While KPIs measure short–term performance goals, OKRs demonstrate future aims and set a long–term path for your company. They can be qualitative or quantitative.
What Are Some Benefits of Implementing OKRs?
The advantages of the goal–setting process with OKRs are apparent with the roster of companies using them. Adopting the OKR methodology lays a positive impact on team sets and tracking goals. Below are some of the core benefits of the OKR framework:
Collaboration and Alignment
Team alignment is one of the prime benefits of OKR. They connect the individuals and team goals towards the strategic mission of a company. A seamless team collaboration plays a pivotal role in a firm’s success, whether working remotely or from the office.
Hence, executives often set company–wide OKRs by effectively collaborating with their team. It helps the team members to work in sync. It also formulates their goals for a shared directional company goal. It assists them in achieving the best targets.
Improved Employee Engagement
Alignment, transparency, and a unidirectional sense give a feeling of contributing personally to a higher company purpose. It accelerates employee engagement and improves the motivation of team members. You can even leverage any ppt template from SlideModel to list and present the OKRs to your team. OKRs suit the best method to keep your workforce satisfied.
Guides to Set and Achieve Stretch Goals
Stretch goals refer to intentionally challenging goals that you are not 100% sure you can hit or not. OKRs inherently drive companies to strive for bigger goals and achieve a little more than their expectations. They encourage everyone to think outside the box and cross that threshold of what seemed impossible. Achieve remarkable results by setting realistic OKRs and unleash the innovative streak of your employees. These OKR challenging goals set the benchmark for future evaluation as well.
Encourages Accountability and Autonomy
Since OKRs track the individual and team goals objectively, it becomes easier to leverage strategic decisions about responsibilities. As opposed to measuring these aims based on a hunch. Further, a bottom–up objective setting lets companies use their expertise to resolve issues with improvements. A pro tip here is to let your team members set 60% of OKRs. It will boost autonomy and make them more motivated to achieve their personal goals.
OKRs lean towards shorter goal cycles that allow teams to adapt and adjust to the desired changes. It helps in the reduction of resource waste and lowers the risks as well. It is in stark contrast to long–term strategic planning, where goals remain more or less fixed. Set strategic OKRs for at least one year and tactical OKRs for a quarter. Again, it wholly depends on the company and its objectives. Your ultimate goal is to stay true to your OKRs for achieving the best results.
How to Implement an OKR System Within a Team?
Gone are the days when the focus of any project reflected individual efforts. Today, every company leverages team collaboration and solidarity for achieving common company goals. Team collaboration tools like Chanty are defining the avant–garde mediums for teams to come together and share ideas.
Team OKRs express the tactics that every team aims to deploy for obtaining goals. Everyone has busy schedules, but OKRs should be the priority of every team member to gain profitable results.
Here are a few ways in which teams can implement OKRs in their organization:
- Introduction: Ensure to introduce your team to the concept of OKRs. Set a meeting and define the schedule of goal allocation that every team member must achieve.
- Involvement of Team Members: Every team member must be a part of the OKR formation. It is a sure–shot ladder to achieve maximum accountability and autonomy. They need to get involved and set their OKRs according to their abilities. When your team sets SMART goals, it becomes easier to achieve them.
- Regular Meetings– Every manager must coordinate with department heads to conduct regular meetings and check the OKR progress. They can discuss the best initiative to acquire goals with the best results. This initiative harnessed at the team level is the key to get results aligned with the company objective.
- Decide Relevant Metrics– Let the teams decide on different Key Results with relevant metrics for every objective. In this way, decoupling OKRs can render objectives more achievable. It also reduces stress levels for employees who might feel that a particular metric goal is difficult to reach.
- Define Your Idea Of Success– Every team must decide its definition of success. For example, some teams might consider hitting 75% of their measurable goals as a success. It also comes in handy to keep a thought–out strategy if your team fails to acquire the targets.
Wrapping It Up
Your teammates would fall to adore the OKR approach once implemented strategically. However, they are not that easy to adopt. It would certainly require quite a lot of effort from your team to get the hang of it. Teams in organizations can link their goals to corporate goals with effective OKRs. It renders them a purpose that their work has an overt impact on the victory of the company.