Objective Key Results
What is Objective Key Results (OKR)?
Objective Key Results (OKRs) is a goal-setting framework that is used by organizations to set clear, measurable, and actionable goals and track progress towards achieving them. OKRs are typically structured as a hierarchy, with higher-level goals (called "objectives") and specific, measurable targets (called "key results") that help to measure progress towards those objectives.
The objective key results (OKR) framework has been popularized by John Doerr, a Silicon Valley venture capitalist. Doerr learned about the OKR framework from Intel CEO Andy Grove, who had implemented the framework at Intel in the early 1980s. Doerr has since become a strong advocate for the OKR framework and has helped to popularize it among businesses and organizations around the world.
Today, OKRs are widely used in a variety of industries, and Doerr's contributions to their development and implementation have had a lasting impact on the business world. It is designed to be a flexible and adaptable tool that can be used by organizations of all sizes and in a variety of industries.
OKRs are designed to be challenging and stretch goals that drive progress and innovation. They are typically set on a quarterly basis and are regularly reviewed and updated to ensure that they are still relevant and aligned with the organization's overall strategy. OKRs are also designed to be transparent, with progress toward key results being regularly communicated and shared with all stakeholders.
What are the benefits?
There are several benefits to using the objective key results (OKR) framework:
Focus: OKRs help to focus efforts and resources on the most important goals and objectives, ensuring that the organization is working towards its most important priorities.
Alignment: OKRs help to align the goals and objectives of different teams and departments within an organization, ensuring that everyone is working towards a common vision.
Transparency: OKRs are typically shared with all stakeholders, which helps to promote transparency and ensure that everyone is aware of the organization's goals and progress.
Adaptability: OKRs are designed to be flexible and adaptable, which allows organizations to quickly respond to changes in the market or business environment.
Motivation: OKRs help to motivate employees by setting challenging goals and regularly tracking progress towards achieving them.
Improved performance: By setting clear, measurable goals and tracking progress towards achieving them, OKRs can help to improve performance and drive innovation within an organization.
Overall, the OKR framework is a powerful tool for setting and achieving goals, and can help organizations to drive progress and achieve success.
“We must realize—and act on the realization—that if we try to focus on everything, we focus on nothing.”
What are the good practices to formulate the objectives?
An objective should be inspirational, easy to remember, and aligned with the team and/or organization's mission, vision, values, and other strategic priorities. It should also be ambitious, but attainable. Here are a few good practices to keep in mind when formulating objectives:
Qualitative: An objective should be expressed in terms of the desired outcome, rather than a specific metric or target. For example, "Improve customer satisfaction" is a qualitative objective, while "Increase customer satisfaction score by 5%" is a key result that helps to measure progress towards that objective.
Inspirational: An objective should be inspiring and motivating employees to work towards it. It should be something that people can get behind and believe in.
Easy to remember: An objective should be easy to remember and communicate so that it is clear to everyone in the organization what the goal is.
Provides business value: An objective should be aligned with the organization's overall strategy and provide value to the business. It should be something that is important and meaningful to the organization's success.
Aligned with mission, vision, and values.: An objective should be aligned with the organization's mission, vision, values, and other strategic priorities. It should be something that helps to further the organization's overall goals and purpose.
Ambitious (but attainable): An objective should be ambitious and stretch the organization to achieve something new or difficult, but it should also be attainable. It should be something that is challenging, but not impossible to achieve.
What are the good practices to formulate the key results?
Key results are specific, measurable targets that help to measure progress toward an objective. There are several key characteristics of effective key results and by following these guidelines you will ensure that the key results you create can help to drive progress and achieve success.
Quantitative: Key results should be expressed in terms of a specific metric or target. For example, "Increase customer satisfaction score by 5%" is a quantitative key result.
Specific: Key results should be specific and clearly define what needs to be achieved. They should be well-defined and leave no room for interpretation.
Measurable: Key results should be measurable, so that progress can be tracked and assessed. It should be clear how to measure whether the key result has been achieved or not.
Time-bound: Key results should be time-bound, with a specific deadline for achieving them. This helps to ensure that progress is being made toward the objective in a timely manner.
Progress-based: Key results should be progress based, with regular checkpoints to assess progress and make any necessary adjustments.
Think about outcomes: Key results should focus on outcomes, rather than just activities or outputs. For example, "Increase customer satisfaction score by 5%" is an outcome-focused key result, while "Conduct 5 customer satisfaction surveys" is an activity-focused key result.
3-5 key results per objective: It is generally recommended to have 3-5 key results per objective, as this allows for a balanced focus on different areas of the objective.
Еxamples
Here are a few examples of objective key results (OKRs). The specific objectives and key results will vary depending on the needs and goals of the organization. The important thing is to ensure that the objectives are clear, and measurable and that the key results are specific and actionable steps to help achieve the goals.
Objective: Increase customer satisfaction
Key Result 1: Increase customer satisfaction score by 5%
Key Result 2: Reduce customer churn rate by 3%
Key Result 3: Increase average order value by $50
Objective: Improve employee retention
Key Result 1: Increase employee retention rate by 5%
Key Result 2: Reduce voluntary turnover rate by 3%
Key Result 3: Increase employee engagement score by 10%
Objective: Increase revenue
Key Result 1: Increase sales by 10%
Key Result 2: Launch 2 new products
Key Result 3: Increase average order value by $50
How do I use OKRs?
I also use OKRs in leadership coaching to help individuals set and achieve their goals. During our initial strategic session, we identify the individual's goals and what they hope to achieve through coaching. Once the goals are identified, the next step is to formulate the objectives and key results. During the coaching engagement, we review the progress in periodic sessions and they serve as a frame for our discussions.
I also love to use OKRs as setting goals for product development. They are great to represent for example Product goals and Sprint goals in the Scrum framework. A Sprint goal is a short-term objective that guides the work of the team during a Sprint, and the Product goal is a long-term objective that guides the work of the team.
Here is an example of a product goal and sprint goals using the objective key results (OKR) framework:
Product Goal:
Objective: Increase user engagement with the product
Key Results:
Increase the number of active users by 25%
Increase the average time spent on the product by 20%
Increase the number of daily sessions by 15%
Sprint Goal:
Objective: Improve the user experience on the product
Key Results:
Implement a new user interface design for the “Registration”
Add X feature to the product
Increase the loading speed of the product by 50%
In this example, the Product goal is to increase user engagement with the product and the Sprint goal is illustrating one potential step in that direction (next Sprints should add more).