At Wiser, we’re constantly trying to improve. As we continuously build our product, attract new users, and win clients, it’s important that we measure where we are against where we want to go.
We’ve tried a few different frameworks for doing this in the past, but the system we like best is setting Objectives and Key Results, or OKRs. When used properly, we think OKRs can be used by any person, team or company that wants to get better and achieve great results.
The Basic Concept
OKRs were invented at Intel under Andy Grove and popularized by the venture capitalist John Doerr of Kleiner Perkins. Companies like Google, LinkedIn and Zynga are now well-known for using OKRs to set and achieve goals.
The idea behind OKRs is to determine where the organization wants to go (the objective) and then set clear metrics that will help confirm when that destination has been reached (the key results).
The objective should typically be a single, inspirational, qualitative goal that will require everyone to align around a common purpose. It could be anything from “set the industry standard for value with our new line of toaster ovens” to “become the trusted, go-to resource for our clients on all of their legal needs.”
The key results should generally be empirical metrics to help ground the mission in reality with numbers that can be measured. When choosing your metrics, ask if they will help confirm if your objective has been achieved, or are merely tangential. If you’re just getting started, pick three to five key results for each company, team and individual objective to keep things focused and to minimize the burden of tracking.
How to Use OKRs
Company-wide OKRs should be set first to provide the overall direction, which then allows teams to set their own specific OKRs that will help achieve the broader mission. Finally, individual OKRs help each person on the team tie their work to the success of the team and the overall objective. Think of a cascading effect, where all team-wide and individual OKRs flow from the same source. As Swipely CEO Angus Davis explained in First Round Review,
When personal objectives are directly and clearly connected to the broader goals of the company, they’re suddenly more inspiring, less myopic. Make them public so everyone can see what’s on their co-workers’ plates and employees no longer feel like they’re toiling in a vacuum, or for their manager’s approval. That way, OKRs become a built-in way for people to ask for resources, or easily spot where they can come to their colleagues’ aid.
Making OKRs Work
While this all sounds straightforward, making OKRs actually work in practice is more complex. Here are some things to keep in mind to make them stick.
- Keep Them Front and Center. It’s one thing to set OKRs at the beginning of a quarter only to dust them off three months later to assess. In order to be effective, OKRs need to be top of mind on a daily basis, and referred to at every relevant meeting or decision point. To help us stay focused on them, we print out our team- and company-wide OKRs and post them around the office. Having regular check-in meetings at the team and company levels that address status on OKRs is a best practice, though piggy-backing on existing meetings should help streamline adoption. For individual OKRs, team leaders should check in with private one-on-one meetings.
- Pick Stretch Goals. When setting both objectives and key results, it’s important not to undershoot. While easy achievements may feel good in the short run, OKRs should help your company grow in ways that won’t always be comfortable. Achieving truly great results and building a culture of success relies on having each person and team push themselves to do work at the margin of what was considered possible. Christian Brucculeri, Vice President at K2 Media Labs, suggests setting key results that are only 60-70% achievable on a consistent basis.
- Don’t Pick Too Many. As noted by Christina Wodtke, consultant and advisor on the subject of OKRs, choosing too many OKRs can dilute their purpose of unifying your organization around a clear objective. While a large organization like Google may need to set different OKRs for separate business lines or divisions, a smaller company will benefit from choosing one OKR to focus and rally effort.
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For more useful concepts on improving your team or company’s workflow, check out our blog post on 4 Easy Concepts to Make Your Team Smarter.