Whether you want to be the top brand in your industry, employ the most talented leaders, revolutionize your production line or all of the above, you need a consistent goal-setting and action strategy to get where you want to go. That’s where objectives and key results (OKRs) come in.
Here is a quick overview of what this OKR guide has to offer:
Objectives and Key Results (OKRs) is a method of goal-setting that helps organizations achieve their mission through measurable and time-bound actions. OKRs help departments and individuals stay on track with the company’s organizational plan.
Each OKR consists of two parts. The objective describes the destination of your actions. For example, a company with a mission of being the top brand in a beverage category might set the objective to reduce employee turnover and retain skilled individuals.
When deciding an objective, keep it:
Ambitious – Top business strategists argue that if you achieve 100% of your OKRs, they’re not ambitious enough. Achieving 60-70% of your OKRs is a good outcome.
Time-bound – Plan to achieve and set new OKRs every month or quarter. This keeps your team focused on and motivated by short-term gains.
Short and simple – Ambitious doesn’t mean complex. If you can’t summarize your objective in a short sentence, there might be too many moving parts.
You should also plan to have five objectives max at each level of the organization at any given time.
Key results are the specific actions you’ll take to reach your destination. Make sure your key results are deliverable or measurable. If the objective is to find and retain top talent to lead each department, the key results might be:
Create a succession plan (deliverable).
Increase employee net promoter score (eNPS)—an indicator of job satisfaction—by 10 points (measurable).
Create an onboarding process that supports new hires with training and feedback at regular intervals during an employee’s first year (measurable).
Each objective you set should have two to five key results.
The first step is to decide your company’s priorities for that month or quarter. Gather together the organization’s department leaders or c-level executives and draft up to five OKRs.
For this exercise, let’s stick with the beverage company example. Here’s one of their organization-wide OKRs.
Note that each key result has a metric. This could be a number, like increasing the eNPS by 10 points, or a deliverable, like a completed succession plan. Each key result also gets assigned to a specific department or person, which is important for the next step.
During the initial organization-wide planning meeting, department leaders should identify which key results fall under their purview. They should then create their own OKRs for their teams, in line with the overall company OKRs.
Often, organization-wide key results translate into objectives for certain departments, as they do in this example.
For the imaginary beverage company that wants to reduce employee turnover and retain its most productive team members, the HR department might take the key result that was assigned to them (create a succession plan in Pingboard) and translate it into this OKR.
This process of transforming company-wide OKRs into departmental or individual OKRs is known as cascading. Cascading makes ambitious goals possible by breaking them down into their smallest parts and involving employees at every level.
Department heads should meet with employees individually to discuss which OKRs best fit their role and skill set. This gives employees the opportunity to ask questions or hash out action plans with their supervisor.
In addition, making sure everyone is aware of each other’s OKRs increases transparency in the workplace, accountability, and teamwork. This is especially true for small businesses that depend upon high levels of collaboration to tackle big challenges.
That’s where a company directory tool like Pingboard can come in. With Pingboard, you can display an individual’s OKRs in their profile so coworkers stay informed of who is responsible for what.
Another option is to display individual OKRs in Pingboard’s org chart format. This gives you a bird’s eye view of how company-wide OKRs cascade down to the individual level, like in the screenshot of Pingboard’s org chart software above.
Ready to start tackling your organization’s biggest goals? Setting OKRs at the top, middle, and individual levels of the company can help you achieve almost anything, no matter how challenging. This OKR planning template will get you started.