OKRs – short for Objectives and Key Results – are increasingly being used by leading companies to manage staff. But why is it so popular?
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“The success of companies in this day and age hinges on the ability to execute. Ideas are important, but they are easy compared to execution. Thomas Edison once said: Vision without execution is hallucination. I’m a big believer in this and I feel strongly that goal setting is the best way to keep the execution machine on track.” – John Doerr, Silicon Valley VC
OKRs have been around for quite a long time. John Doerr first encountered them at Intel in the 1970s, but it was only when he introduced the concept to Google, that they skyrocketed in popularity. When it was discovered that Google was obsessed with OKRs, everyone was suddenly interested in this unique approach to management.
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What are OKRs?
OKRs shouldn’t be dismissed as a Silicon Valley fad. The concept has real merit, mostly because it enables you to take vague and ephemeral company goals and tie them to concrete metrics.
It works as follows: A crucial company (or team) goal is identified and put into simple language. The aim is to make the objective qualitative and inspirational. An example would be to ‘grow the company into the stratosphere’.
This objective, it should be obvious, is bold but pretty vague, which is why it needs to be tied to key results. These are quantitative in nature, tying the objective to measurable results.
Choosing key results
How does one identify key results? It starts by unpacking an objective. How, for instance, would you know that you have succeeded (or failed) in ‘growing the company into the stratosphere’? It would require one to select measurable growth objectives, such as tripling turnover and growing your user base by a factor of fifty.
Each objective can have several key results, and these should not be easy to achieve. The whole point of OKRs are to create audacious goals, and then pursue them diligently. OKRs shouldn’t be impossible to attain, but they should be challenging.
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How to use OKRs
You don’t want to create an OKR and then forget about it as daily tasks demand your attention. Because of this, OKRs should be public and highly visible. Every team’s objectives and key results should be put somewhere in a place where everyone in the company can see them.
OKRs should also be selected quarterly to ensure a sense of urgency. If an OKR is too far off, everyone will be slow to action.
An OKR should create a bit of pressure to get things done. So objectives should never be moved or extended if failure is imminent. If you don’t stick to the timeline, the whole exercise loses its purpose.
OKRs (Objectives and Key Results) are a great way to tie metrics to your teams’ goals. This ensures that everyone stays accountable and works towards concrete aims.