Write Objectives and Key Results (OKRs)
Objectives and key results (OKRs) is a popular method of establishing goals for a business, as well as a way to measure how successfully the business achieves these. The method was pioneered by Intel, and has been used by major corporations like Google and Twitter as well as numerous startups and small businesses. To write OKRs, begin by defining your business objectives, then develop some metrics to track how well you are meeting them.
Contents
Steps
Defining Your Objectives
- Write objectives that are qualitative in nature. The objectives of your OKRs should communicate something that is important to your company’s values and overall mission, rather than focus on hard numbers. Leave the quantitative assessment for the key results portion.
- ”Introduce a new social media channel for marketing” is an example of an objective, while “Increase social media traffic by 25%” is an example of a key result.
- The number of objectives you set can vary. Some companies focus on one major objective per quarter, while others might set multiple ones (if they have several departments, for example).
- Make your objectives inspiring. OKRs are meant to get your team members excited so that they will push themselves beyond their comfort zone, and take the company to new heights. Use language that “speaks” to your crew.
- Examples of good objectives include: “Crush the iced coffee market in San Pedro this summer” and “Launch a killer new restaurant finder app.”
- Less effective objectives are vague and boring, like “Get more users” and “Make a new product.”
- Plan time limits for your objectives. Usually, OKRs are planned quarterly, or even monthly. This is one of the major ways that OKRs differ from other objectives your company may have.
- If the objectives you want to write are more long-term, this is a sign that they are actually part of your company's mission rather than an objective for an OKR.
- For example, “Give customers the best coffee in Southern California” is an ongoing, long-term goal that is better as a mission statement than an objective for an OKR.
- Involve your whole team. OKRs are usually directed by management, often a company’s CEO. Your objectives should have your whole team in mind, and focus on collaboration.
- OKRs are not performance reviews, and should not be treated as such. Tying them to things like promotions and compensation discourages employees from pushing to improve the company as a whole.
- You can also apply the OKRs method to personal goals as well, using the same basic procedure.
Identifying Key Results
- Decide what to measure to assess your success. To see how well your company is achieving its objectives, you will need measurable, quantitative methods, or key results. Metrics will vary widely depending on your company and objectives. Some common things to measure (and examples of how to assess them) include:
- Growth (e.g., increased sales)
- Engagement (more customers)
- Revenue (higher profit margins)
- Quality (repeat customers, which equals confidence in your product or service)
- Choose three key results for each objective. If you set too many benchmarks for your objectives, meeting them will become overwhelming. Too few, however, and you may not be able to accurately assess how well your company is performing. Most experts agree that the magic number of key results for each objective is three. For example, if your objective is “Crush the iced coffee market in San Pedro this summer,” your key results might include:
- Raise iced coffee sales by 20%
- Increase foot traffic on weekdays
- Double the number of repeat customers
- Make your key results difficult, but not impossible. OKRs are based on the idea that by pushing your company’s limits, you will drive growth and improvement. In order to push limits, you need to set a high bar. In fact, you should not expect to perfectly achieve your objectives.
- A success rate of somewhere between 50-70% is the normal expectation.
- For instance, if your key result is to raise sales by 20%, actually raising them by 10-14% would mean successfully working toward your objective.
- If you are consistently meeting your key results at or near 100%, that’s a sign you are making them too easy.
Working with Your OKRs
- Circulate your OKRs. Objectives and key results are meant to be public. They’re goals for the company as a whole, unlike individual performance reviews. Sharing a document describing your OKRs with your whole company will make its trajectory transparent, and all team members will feel important to its success.
- Monitor your OKRs. Don’t just write your OKRs and forget about them. To really make them effective, you’ll have to keep them in mind. If you have weekly company updates or meetings, you can share a brief statement about the steps you are making to achieve your goals.
- For instance, if you are tracking sales figures, present the previous week’s sales at each new meeting or in a memo.
- Contextualize the information by saying things like “We increased sales 8% last week, which is great, but we’re still short of our quarterly goal of 20%. Let’s try a coupon campaign this week to keep raising sales.”
- Publish your results. At the end of the quarter, share the results of your OKRs with your company. Since a 50-70% success rate is normal, contextualize them in terms of your company’s overall mission.
- For example, imagine your objective was to “Crush the iced coffee market in San Pedro this summer,” and key results were raising sales by 20% and increasing weekday foot traffic.
- You raised sales 12% and increased foot traffic on Wednesdays and Thursdays.
- Say: “Increased sales and foot traffic show that we’re on our way to fulfilling our company mission of providing the best coffee in Southern California. Next quarter, let’s concentrate on increasing traffic on Mondays and Tuesdays.”
