By Combining Purpose with Results
OKRs – Objectives and Key Results has become a crucial goal-setting tool, especially for Google, IBM, Twitter, LinkedIn, Disney, Spotify, BMW, and Twitter. It helps millions of employees working for the same purpose.
However, you don’t have to be a multinational corporation to benefit from OKRs. It’s a simple and powerful tool to help all types of businesses as well as for setting personal goals. Here is everything you need to know about OKRs and why it’s critical for your organization’s success.
OKR Framework – A Simple Model
OKRs appeals to several leaders due to its effective and straightforward structure. The OKR framework comprises of Objectives and Key Results.
The first and foremost part of an OKR is the Objective. It includes setting 3 to 5 critical goals at the organizational level. These objectives are further divided when it comes down to departments, teams, and individuals.
If somebody is in a leadership position, this is where you can establish a significant example. It will help everyone to achieve their goals for the growth of the business.
These objectives could be more focused on each member’s responsibilities and roles, but they must be aligned with the overall company’s objectives.
To accomplish each recognized object, there should be 3-4 determinate results or strategies for actions. Being a leader, it helps you to evaluate the performance of each team member and determine whether they are doing right to achieve the company’s goals or not.
OKR results are dependent on many factors, including employee engagement, company revenue, growth, performance, etc.
With the help of calculated values for each key result, it becomes easier to determine the progress as per the organization’s objectives.
Benefits of having a growth-based OKR Framework
- Calculable growth-impacting projects are lined up and highlighted by everyone in the company.
- It enables your team to set measurable, determined growth-based aims.
- It supports transparency by allowing employees to identify and understand the roles of everybody else and their effect on the corporation. This also ensures accountability and responsibility.
- OKR challenges the workforces to exceed their limits and set ambitious goals, which leads to revolutionary successes.
- It increases the business’s revenue; thus, more cash generated. This cash can be invested back for the further growth of a business.
- The OKR framework actually helps teams, companies, and leaders to grow because it offers a useful framework to set measurable ambitions that create a unified direction and clarity for each and every employee.
- It keeps your firm allied with the company’s intent.
- OKRs help you concentrate on what’s really important with a focus on measurable vital actions.
- From teams to departments to individuals, it helps in determining everybody’s performance and goals.
An Example of OKR from Silicon Valley
Let’s have a look at the early adopters and innovators to know the importance of applying an OKR. John Doerr, engineer, acclaimed venture capitalist, and the now chairman of Kleiner Perkins was working at Intel and decided to modify the management-by-objectives approach which was firstly introduced by Drucker in the 50s. Doerr wanted to enhance the focus on specific results of an objective that was designed to achieve – it includes the business outcome, so he created OKRs (Objectives & Key Results). In the early eighties, John switched to Google, and this is how OKRs (and Google) came side by side.
These businesses have number of global clients who look to them for modernization. Hence, there is no harm in assuming that what they are doing for themselves, they will be beginning to do the same for their clients. This means that the OKR approach to performance – a more “frequentative” approach – is at a tipping point.