OKRs or “Objectives and Key Results” are a goal setting framework used to align a company around common goals and measure progress towards them.
Cool things about OKRs:
Objectives are set first and ideally are inspirational.
Under each objective you create several key results that measure if you achieved the objective.
Some notes about Key Results:
Objective: Successfully enter a new market Key Result: Get 20 customers in new market Key Result: Get 5 partners in new market Key Result: Close 500k in revenue from new market
Objective: Successfully enter a new market
Key Result: Get 20 customers in new market
Key Result: Get 5 partners in new market
Key Result: Close 500k in revenue from new market
OKRs were developed by Andy Grove at Intel and then brought to Google by John Doerr when Google was about 40 employees. From there is spread to many Silicon Valley companies and is now used by companies of all sizes and industries.
Companies that are known to use OKRs:
The easiest way to understand OKRs is to look at some examples. Let’s say you’re a startup looking to launch a new product.
Your objective may be:
Objective: Find product market fit
Now you can ask yourself what key results would measure that you’ve found product market fit.
Key Result 1: Get 50 customers to trial our new product
Key Result 2: Get 20 customers to purchase our new product
Now you have an objective and key results that measure if you’re making progress towards that objective.
OKRs can align vertically and horizontally and are set at different levels.
OKRs are set at the company level, at department or team level and at the individual level.
Company Quarterly OKRs
Head of Sales OKRs
Sales person OKRs
Head of Marketing OKRs
Marketing Specialist OKRs
Head of Product OKRs
Product Manager OKRs
You can set OKRs at any time interval but the most common is every quarter.
Smaller companies may feel the need to set them more frequently as change happens quickly whereas larger companies may prefer a longer time frame.
With JustOKRs you set your OKRs every quarter.
OKRs are commonly scored from 0 to 1.0 or from 0 to 100 percent.
Key results are graded first and then to get a score for the objective you take the average from all the key results under the objective.
If you have three KR’s with scores of 60%, 60% and 90% your objective would be scored at 70%.
(60 + 60 + 90) / 3
A key tenet of OKRs is setting stretch goals. You want your team to set ambitious goals.
Because of that an average score of 60 to 70 percent across all OKRs shows that you’re in the right range.
If your scores are less then your team may be under performing or setting their goals to ambitiously.
If you’re getting 90 to 100 percent your team is likely not setting ambitious enough goals.