Updated: Feb 20
No doubt you've been hearing the buzz about a goal-setting methodology called Objectives and Key Results (OKRs). Although this may sound like a brand new thing, they've actually been around since the 1960's!
Here's a brief history of OKRs:
What are OKRs?
For those new to it, Objectives and Key Results are a management methodology that helps to ensure that the company focuses efforts on the same important issues throughout the organisation by taking a quarterly valuable slice out of our strategy. OKR adherents include Google, Dropbox, LinkedIn, Oracle, Slack, Spotify, and Twitter.
How are they valuable?
The pace of change is an ever-increasing reality of business. With continuous changes in customer needs and shifts in the regulatory environment mean it's more important than ever to adapt to these challenges in an aligned and focused manner.
John Doerr, an American investor and venture capitalist who’s seen the power of OKRs at a wide range of companies, does an incredible job of explaining the benefits of OKRs in his TED Talk - Why the secret of success is setting the right goals.
How are they structured?
It’s actually incredibly simple, an OKR consists of an Objective which is measured by 2-5 Key Results which are generally set and achieved within a quarter. Here’s an example:
Objective: Have our customers fall back in love with our offering
40% of users come back 2X in one week
50% increase in customer referrals when prompted
20% increase in retention
50% increase in customer satisfaction
In short, OKRs can be framed as I will achieve this (objective) as measured by (this set of key results).
Objectives are simply WHAT is to be achieved, no more and no less. They are significant, concrete, action-oriented, and (ideally) inspirational. The success of each objective is measured by 1-5 Key Results, which benchmark and monitor HOW we get to the objective.
Effective KRs are specific and time-bound, aggressive yet realistic.
Most important of all, Key Results are measurable and verifiable, therefore we aspire for them to be a metric we’re moving the needle on, rather than an activity or plan. Where we are today, this may not always be possible, but it’s where we need to be.
How do I get started?
The best place to start may not be so obvious. A lot of people start by introducing OKRs to their team. This usually involves education and influence - and if you're up for the challenge, go for it!
If you'd like to start a little slower, why not try experimenting with OKRs yourself? It could be your personal goals for the quarter or could be as simple for capturing goals for an upcoming birthday party.
Where can I find out more?
SKILLFIRE are obsessed with OKRs and always keep for a chat or to come to your office to share our knowledge with a brown bag. Getting a little more serious and what to influence your leadership on OKRs? Reach out and we'll share our OKR pitch deck with you!
We're always keen to chat, so contact us at any time!