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Successful Goal Setting using the OKR Method

Succesful goal setting using the okr method

Successful Goal Setting using the OKR Method

Setting Goals

When people are asked to write down their goals, they either write down a whole bunch of them or they need quite some time to think of even one. Rarely people write down two or three goals off the top of their head.

It turns out that keeping goals in our head leaves us with too many vague notions. We haven’t given them much thought, and rather just do the work that’s in front of us. Taking a moment to put goals on paper makes you choose the most important thing you need to work on.

Creating an actual phrase for your goal will make you and your team think about the wording. It makes you consider what the goal means to you. By clarifying what it means to you, you increase your team’s emotional attachment towards the goal and that increases commitment.

The OKR method is a way to set goals. It’s popular because it’s simple, yet powerful when everybody in an organization or team uses it.

OKRs Goals
shared okrs

Objectives and Key Results

When the topic of ‘goals’ comes up, they are quickly followed with the suggestion to make them SMART or S.M.A.R.T. While it is important to have Specific, Measurable, Achievable, Relevant, and Time-bound goals, we deliberately choose to use the OKR method to set goals. Writing goals in the S.M.A.R.T. format tends to make them a little less inspiring and hard to recall. Almost a bit of a dry read.

When we are looking for engaged high-performing teams we want goals to be inspiring and easy to remember. Something that gets you to jump out of bed in the morning. This is where the Objectives and Key Results (OKR) method helps us. The initial form of the method was created by the Hungarian Andrew Grove (András István Gróf) at Intel, and it’s used by many other companies including Adobe, Facebook, Google & LinkedIn.

What's an Objective?

Your objective sets the direction. It shows where you we want to go.

An objective is simply one sentence that inspires the team, maybe even scare them a little, but definitely create excitement among them.


What are Key Results?

Key Results are the milestones in your objective. They are the most important metrics which tell you if you make progress towards the objective.

Essentially, it is a non-debatable way for you and others to determine whether or not you’re progressing towards your objective. And at some point passed the milestone or not.

Example OKRs

1st Objective - We Hire to Retire

Key Results

  1. Reduce employee turnover to less than 2% monthly.
  2. Review 3 new recruitment channels
  3. Reach top 10 in greatplacetowork.com

2nd Objective - Be the Go-to Financial Services Provider for Businesses in US

Key Results

  1. Grow revenue to $3M
  2. Get into the Gartner Magic Quadrant
  3. Maintain Net Promoter Score of 9

3rd Objective - Delight our Customers

Key Results

  1. Customer Satisfaction (CSAT) of 5
  2. Get a Customer Effort Score (CES) of 4 or higher
  3. First Response Time under 10 Minutes

example okrs
undraw Progress overview re tvcl

Grading & Rhythm

We call the scoring of key results Grading. An often-used grade is between 0.0 and 1.0. Anything below 0.5 means that a Key Result was probably too ambitious. Between 0.5 & 0.6 is a step in the right direction. And between 0.6 & 0.8 is very well done! Above a 0.8? Dare to set your OKRs a bit more ambitious next time!

Since OKRs are time-bound, it’s important to work in a certain Rhythm. This is something your team agrees to. You can imagine that working on a set of OKRs for 1 month may be a bit too short to really achieve anything, where 6 months would probably be a bit too long.

Often, a period of 3 months is chosen as a rhythm. This means you get to set and reach new OKRs every quarter. The grading of OKRs should also happen during this rhythm. Obviously, you want to measure your progress not only at the end of the quarter.

A sensible default is to grade every month when working with quarters. But in some cases, organizations do this much more frequently — during their weekly meeting, for instance.

OKRs and The Alignment Canvas

The Objectives and Key Results are an integrated part of The Alignment Canvas. The canvas is a one page picture you paint together with your team. It aligns the ambition with the objectives, your companions and the tactics that will get you there. 

Where the Ambition is set on a longer term. The OKRs are set for a shorter term, we advise to keep a quarter or year perspective.

The Alignment Canvas gives you space for 1 to 4 objectives. While there’s nothing wrong with having more objectives at a time, the fewer you try to juggle, the more successful you will be at achieving them. Putting your OKRs in the context of your ambition, companions and tactics makes the OKR method even more powerful and transparent to others.

OKRs in the Alignment Canvas

More information on the Alignment Canvas here

Setting Objectives using the Alignment Canvas

After settling on your Team’s Ambition, in the 1st step of the canvas, it is now time to think about matching OKRs.

Since you have the ambition on paper it should be quite doable to write down some objectives. Before we dive into a discussion with each other we like to have all team members take 3 minutes and first write the objectives for themselves on post-its before discussing with the team members. After the 3 minutes we ask for everyone to stick their post-its to the wall and elaborate on them. During this part it becomes quickly clear where the differences are and where alignment takes place.

During this collaborative process with your team, you’ll often find that there will be around 5 to 6 objectives on the table. The hardest part at this point is to make a deliberate choice on which of them will make it to your canvas. Take another good look at the ambition and together find out which 3 to 4 objectives are bringing you closer to your ambition.

 

Setting Key Results using the Alignment Canvas

In step 5 you will work on the Key Results. It’s on purpose that we first take you through steps 3 & 4, Beneficiaries and Allies, since knowing your companions helps defining the key results. 

The Key Results are directly connected to your Objectives. We start with the 1st Objective. Looking at what you described there, the question now is what things could you measure that brings you closer to the objective?

Learn About the Other Steps in the Canvas?

Start Aligning OKRs With the Canvas