What are Confidence Ratings?
To help you track your OKR progress, Koan focuses on two components of every key result, the key result's metric and its confidence ratings submitted from the key result's lead and contributors.
A confidence rating is a score from 1-10, (separated into red, yellow, and green) on how likely an individual thinks the key result will be achieved in the time frame remaining. Once a week, all leads and contributors will be asked in their reflections to submit a confidence rating for every key result that they are working on.
These ratings help Koan to accumulate various insights including the Confidence Index Score. The confidence ratings are also visible throughout the tool. Wherever the key result is listed, the lead's most recent confidence rating will be visible as well.
You can find averages of lead and contributor confidence for any key result by selecting the key result and then going to its Discussion tab.
Why are Confidence Ratings Important?
Mixing this quantitative and qualitative data gives your team a better sense of how you're tracking towards your goals, especially when the numbers don't give the complete story.
For example, imagine a sales team working towards a revenue number. Even if the metrics don't look good early on, the team knows what their pipeline looks like and how likely their leads are to convert. Because they have this context, they will typically have an idea of whether or not they will hit the goal at the end of the quarter, regardless of the starting metrics.
Submitting a Confidence Rating
You will submit confidence ratings weekly through your team reflection.
For every key result you are a lead or contributor on, your reflection will ask you to submit a confidence rating and an associated comment. We suggest that your confidence rating is as honest and realistic as possible and that you include a detailed comment to give your team members more context behind your rating.
When selecting a confidence rating, you will choose a number on 1-10 scale, with 1-3 being "At Risk", 4-7 being "Has Issues", and 8-10 as "On Track."
Generally, we think of this meaning:
At Risk: The goal is at risk of failure. Without changing drastically, there is a very low likelihood of success.
Has Issues: The goal might not be hit. There are hurdles to clear, but success is possible.
On Track: It is likely that the goal will be hit. Success is expected.
Note: Read more about submitting reflections and confidence ratings here.
Confidence Rating Best Practices
When it comes to best practices around confidence ratings, we generally like to share two essential tips:
Discuss with your team your shared definitions around 'On Track', 'Has Issues', and 'At Risk'.
Encourage honesty and transparency within your team when it comes to confidence ratings.
Even though confidence ratings are intentionally qualitative and subjective, it is important to get on the same page with your team members when identifying the different meanings of different ratings. Your team should sync internally to decide on the specific criteria that your team has for when a goal is At Risk, Has Issues, or On Track. Using that criteria, you can be more specific with your ratings.
Some examples being:
If things are going well, but you're worried there might be some upcoming hurdles, or that momentum has slowed, rating your goal with an 8 helps give that context.
The goal had issues, and you aren't seeing progress made towards overcoming those issues. These aren't blockers yet, but something to be wary of, so you'd rate it a 4.
You had issues with your goal, and the team put in a lot of work, but it's too early to see the results. Rating with a 7 helps communicate your feelings more directly.
Honesty and Openness with Confidence Ratings
It is essential that you and your team create a safe and understanding environment when it comes to rating key results honestly. Confidence ratings are not intended to be used to evaluate individuals or signal problems in an individual's performance, but rather are intended to be a tool for teams to work together to identify problems early on and then to solve them together.
Having this understanding as a team helps to ensure that people are comfortable submitting low confidence ratings when they do identify issues in progress. Submitting a low rating is actually very constructive because it gives the team the opportunity to work together to pivot and come to a solution to get the goal back on track before the end of the quarter.
Similarly, if teams do not create an understanding that it is okay to submit a low confidence rating, this will result in individuals rating goals as 'On Track' regardless of whether or not they identify issues in the goal's trajectory. This results in having low goal achievement at the end of the quarter because issues in progress were not identified proactively.