Running a business is a lot like piloting a ship; above all, you need to know where you’re going and how you’re getting there. What’s more, you need a crew that knows how to back you up when you need it most.
Objectives and key results, or OKRs for short, are a time-tested methodology for ensuring that you and your company have the smoothest sailing possible. They make it easy to set and track company goals so that your entire team knows what needs to be done, how to do it and why it matters in the larger vision of your business.
The OKR framework has helped countless businesses synchronize their teams and realize ambitious goals, launching their companies to new heights.
This guide will walk you through the process of implementing OKRs in your own company, making them a value-driving component of your operating system.
In this guide, we’ll cover the five parts of an effective OKR process, including:
Every step in this generalized guide will apply to the majority of startups, but some will benefit from additional frameworks that aren’t included. To get started, make a copy of the OKR framework and template. You may want to refer to the overview on slides 3 and 4 of the deck.
OKRs have a very specific framework that is integral to the success of the methodology. There are several key components of an OKR process, which will each be explored more deeply later. They are:
If your company is a spaceship, your annual objectives are the destination. Image Credits: M13
If your company is a spaceship, your annual objectives are the destination. Image Credits: M13
If your company is a spaceship, your annual objectives are the destination. The key results are the dials on the console that show your speed and indicate whether you’re on course, and the initiatives are the actions of the crew and pilot that keep the course steady and the engines burning.
It’s important to understand the differences between each piece of the OKR framework, as it can be easy to confuse them in the beginning. Without a strong distinction between each component, it will be much harder to implement your OKR process successfully.
OKRs make it easy to set and track goals so that your entire team knows what to do, how to do it and why it matters.
A clear ownership structure is vitally important to the OKR framework. Without a dedicated captain, you’ll find yourself wasting resources and letting details fall through the cracks.
We recommend establishing a point person to take top-down control of the OKR process as early as possible.
This person should interact closely with leadership and understand the big picture of your business. Operations managers and chiefs of staff are typically good choices for this role.
Annual objectives are the big picture items for your business. They’re ambitious, large-scale goals that you and your team can look to as a reminder of your company’s purpose and direction.
When setting your objectives, ask yourself what will move your company forward and create meaningful change in your business. Which company goals are most pressing? What would you like to see happen in the next year? What core tenants of your model can you expand upon and improve?
Creating a good annual objective may seem simple at first glance, but it takes a bit of practice to get right. Annual objectives must have a specific format to function properly in the OKR framework.
Objectives are:
As a counterexample, let’s take a look at what you should avoid when creating your objectives.
Objectives are NOT:
Source @TechCrunch
