While it can take a while to “get” the power of OKRs, once the lightbulb goes off, they can transform how an organization aligns and executes towards goals.

In addition to creating alignment, OKRs can help you create an accountable, transparent culture. That’s one of the reasons I think they work so well in remote, flexible work environments.

If you want to understand what OKRs are, why you would use them, and how to adapt them to your organization to maximize results, here’s a bit of an “OKR 101” to get you started in the right direction.

What are OKRs

OKRs (Objectives & Key Results) are a tool for aligned goal setting and progress tracking across the organization. An objective is a goal, and the key results measure progress in the achievement of that goal.

OKRs comprise an objective—a clearly defined goal—and one or more key results—specific measures used to track the achievement of that goal.

Wikipedia

From a Beginners Guide to the OKR Framework: “OKR stands for Objectives and Key Results, a framework to define objectives and track outcomes. They are meant to set and communicate strategy and goals for a specific period of time for an organization, teams, and team members. At the end of the time period, OKR provides us a mechanism to evaluate how well the objectives have been executed. This feedback helps us to plan better moving forward. The primary goal is to connect company, team, and personal objectives to measurable results. Key results are almost always defined with numbers to allow us to measure success. They don’t specify exactly how a team will achieve those numbers, just what the goal is.”

Essentially, Objectives tell us where we want to go, and Key Results help us know if we are getting there. As the quote above clarifies, OKRs don’t specify how a team will achieve the key results, which is also important (and probably one of the only shortcomings of OKRs). I always recommend that once OKRs are set, managers go through an exercise focusing on execution so that everyone understands what has to be done to achieve them.

Where did OKRs come from?

As legend has it, OKRs originated during Andy Grove’s leadership reign at Intel. They spread across other Silicon Valley companies due to their effectiveness. And then they grew in popularity when Google adopted them (at the urging of venture capitalist John Doerr).

OKRs…supported Google’s growth from 40 employees to more than 60,000 today.  Besides Google, other companies use OKRs, including Spotify, Twitter, LinkedIn, and Airbnb. But the OKRs system is not only for digital companies. Walmart, Target, The Guardian, Dun and Bradstreet, and ING Bank are also using OKRs.”

The Beginner’s Guide to OKR

Why would your company adopt OKRs?

You might be adopting OKRs because your board or a strategic advisor told you you should. You might be adopting them because you read a book or because you know of another startup that implemented them. You may feel that everyone in your company is scattershot working on different things, and you heard OKRs can help.

There are lots of reasons companies come to OKRs. I came to them when I joined a company that was in the early stages of implementing them. It was going “ok” but not great. It was complicated, taking lots of time, and people didn’t understand what they were or why the company was doing them. And really, the company didn’t feel like OKRs were helping them achieve any goals. A pretty common scenario. As the leader of people & culture, I needed to quickly get OKRs on track and change our culture so we could continue the high growth trajectory we were on in a more coordinated, methodical, and aligned manner.

Here’s what I learned and why I came to love OKRs.

• OKRs provide total transparency into company, department, team, and individual goals and progress. Everyone can see any OKRs (unless you opt to leave them private, which you shouldn’t). OKRs help everyone know what others are expected to achieve and how they are measured. This helps ensure everyone is heading in the right direction. And more than anything, it creates a culture of transparency. Seeing company, department, team, and individual (including the CEO’s), OKRs eliminate confusion, duplicate or conflicting work and help create employee engagement. It’s simple but powerful.
• Because OKRs can (and should) be aligned to other OKRs (for example, a department OKR can align with a company OKR), you can be confident that the initiatives and goals people are focused on are pointing in the same direction (toward the company objectives). It’s important that everyone is rowing the boat together towards your big goals, and OKRs help you do that.
• OKRs help everyone focus on the most important initiatives and, in that way, help staff to be accountable to themselves, their peers, and to leadership. Because OKRs are visible, everyone knows when goals are achieved and when they aren’t. Hopefully, you often hit your goals. But sometimes you won’t. OKR transparency creates a culture of honesty and makes it safe to be open about how we are doing. People can be honest in their assessment of why an objective was missed and how to do better the next time around.
• OKRs can facilitate agility. When you have a quarterly OKR cadence, you can review the past quarter to assess your performance and make adjustments for the coming quarter to set your course for success. This agility helps you stay relevant and adaptable to the business's needs.

OKR Tips and Tricks