What Does OKR Stand For
OKR stands for ‘Objectives and Key Results‘. It is a method of setting business, team, and personal goals collaboratively. The process is used by many modern organisations to measure progress against goals. The idea behind OKRs is that you should set clear, ambitious, and measurable objectives and then track how well they’re being met. OKRs are also a way to align people around those goals.
OKRs are a set of objectives and measurements that are further broken down into cascading OKRs for teams and individuals. The idea behind OKRs is to help teams align and focus on what they need to do to achieve their goals.
What is the Difference Between KPI and OKR
KPI stands for ‘Key Performance Indicator‘, which is a metric used to measure performance of objectives. KPIs are attainable and represent the output from a process or project already existing. OKRs are more aggressive and ambitious. The OKRs should always be stretch goals. Ideally, you do not want to reach 100% of all OKRs. OKRs are not meant to be a box ticking exercise, rather something that rallies the organisation to go further and climb higher.
How to Define and Write Good OKRs
The first step to writing good OKRs is to define what they mean for your organisation. To do this, you need to understand the purpose of setting OKRs. This is done by understanding why you want to set them up in the first place. What is your organisation and teams wanting to focus on and achieve?
1) OKRs are outcomes, not a set of tasks
It’s always tempting to write a list of tasks for OKRs. No, OKRs are not a set of tasks to be completed. They are the guide towards knowing what to do. E.g. You set an objective that you want to grow your business and the measures are a 15% increase in conversion rate and 5% reduction in churn. You might do a number of tasks to achieve the above. Think of outcomes, not tasks.
2) Keep OKRs to a minimum, don’t try to do too many things
The purpose of OKRs is to get everyone to focus on what’s important for the teams’ success. It’s best to have a maximum of two OKRs per team with a max of three key results under each objective. You do not want to feel stressed that there’s too much to achieve. You should be in a position to focus on a couple of things and work towards achieving them efficiently.
3) Make your OKRs ambitious
You shouldn’t be hitting and achieving your OKRs all the time. If that’s the case, your OKRs are not ambitious enough. You should be able to achieve some, get close to some, and fail at others. That’s how life in the real world looks like. The aim is to push your entire organisation to aim higher. It’s okay if they don’t reach the summit. They’ll still have had right direction and gone in that direction.
Also, ensure that you have the resources to deliver! No point making ups OKRs related to website updates when you do not have a web developer to deliver them!
4) OKRs should be cascading
Define three levels of OKRs – company wide, team level, and individual. The Individual’s OKRs should connect with a couple of KRs of the team’s. The team’s OKRs should connect with a couple of KRs of the company’s. Every one and every team should be working towards the organisation’s goals. This might be hard to get right at first. As you go through a couple of cycles, you’ll be able to learn how to cascade them.
5) Do not connect OKRs with performance reviews
Doing so will make your team turn OKRs into something that they can achieve and excel. You want OKRs to be the guiding light, not something that people smash all the time. Tying up OKRs to performance reviews will send mixed signals and the focus on the organisation’s growth will be lost.
Examples of OKRs for Marketing
- Increase customer reach by 25% (Objective)
- Improve email newsletter open rate by 10% (Key Result)
- Enhance retargeting campaigns to achieve additional 50% reach (Key Result)