What and Why
Objectives and Key Results (OKRs) is a simple and powerful framework for setting goals. Organizations like Google, Intel, The Gates Foundation and thousands of others have proven that OKRs can help teams of all sizes achieve amazing results.
How do they work?
Objective: what you’re trying to accomplish.
Objectives are a brief, memorable statement of what you want to achieve. By signalling your intent, each objective places your work within the company’s high-level strategy and helps others relate your efforts to their own. The objective should be actionable, time-bound, and ambitious. It should stretch you and your team to achieve more than may at first have seemed possible.
Key Results (KRs): how you’ll measure whether you achieve the objective.
Objectives are measured by three to five measurable, verifiable KRs. Key results typically have a specific metric, e.g. “Grow to 1000 active users in our private beta”, giving a black-and-white answer to whether it’s been completed. And once all KRs are completed, you’ve achieved the objective.
Pretty simple?! The true power of OKRs comes through using them through the full goal lifecycle: setting the goal by declaring what’s most important and why, measuring progress, achieving (or failing to achieve) the goal, learning from the experience, and improving next time.
Famous venture capitalist and OKR guru John Doerr writes about four “superpowers” of OKRs:
- “Focus and commit to priorities”: setting OKRs forces the conversation of what’s most important and makes it easier to let go of all the things that aren’t.
- “Align and connect for teamwork”: committing to transparency of OKRs across the entire organization means everyone knows the priorities and can self-organize to achieve the goals.
- “Track for accountability”: regularly and transparently measuring progress uncovers problems earlier and drives the team to win.
- “Stretch for amazing”: setting and then achieving or failing at hard OKRs will let you accomplish more than you ever thought possible.
OKRs work best when each team sets their own. From the overall objectives and strategy set by the executive team down to quarterly—or even monthly—objectives on the ground, the OKR process draws on expertise at every level of the organization to help the company win.
A simple template for writing OKRs:
- We will __(Objective)__ as measured by __(Key Results)__.
When writing OKRs, remember to focus on what you want to achieve as a team, not how. In particular, avoid setting a long list of key results that are projects or tasks.
Each key result will have a lead (in some cases multiple leads) that is accountable to making sure the key result is accomplished, as well as a set of people that are contributing to the KR.
Don’t write OKRs in isolation! Project stakeholders, managers, and peers will all have helpful feedback. And as the people most impacted by your team’s objectives, they may even know of resources that can help you deliver!
Weekly updates on the status of your key results keep the rest of the company looped in to your work. The update includes both quantitative progress towards the KR’s metric, as well as your qualitative assessment of whether the KR is “on track”, “at risk”, or somewhere in between. This assessment is a powerful tool for signaling blockers and spurring corrective action—yet another example of how OKRs support critical communication within your company.
A marketing team seeking to reduce overhead might set the following objective:
Objective: Optimize Adwords spend
- Reduce cost per acquisition (CPA) below $10
- Reach 15% Adwords clickthrough rate (CTR)
- Increase customer acquisitions by 10% month-over-month
Note the balancing effect between the key results: the objective seeks to reduce CPA, but not at the cost of overall growth.
Can I use OKRs in Koan?
You sure can!