You might be disappointed to know that despite its cool acronym, OKR is not a secret service agency but rather a goal setting methodology famously used by some of the most well-known companies on earth (think Google, LinkedIn, Airbnb, Twitter). But what is OKR? It stands for Objectives and Key Results and can help you get clearer on measurable goals for your company, allowing you to execute growth and team management strategies that will facilitate the objective. OKR examples include setting very clear goals such as achieving 250% growth in the European market.
So why should you implement a specific OKR instead of sticking to a vision board? Well, we could give you a million reasons, but we thought you might want to hear from the experts instead:
Is it cheating to include the guy who literally wrote the book on the subject? Not really, if he’s also the person credited for Google’s success in implementing OKR!
Doerr attributes a lack of OKR implementation to a company’s reluctance to be transparent and accountable. But once OKRs are implemented, according to Doerr, companies can benefit from focus, alignment, commitment, tracking the progress, and stretching (which spells out FACTS, to make it even easier to remember). Simply put, OKRs allow a collective vision to be singled out, driving incentive to reach not just the goal but more.
Doerr thinks OKR is the perfect system for companies with a large millennial worker population, as the system fits millennial approaches to business: “they want nearly constant feedback, but without being micromanaged. So this kind of a distributed system (…) is perfect.” If your business relies on millennials to operate, take John Doerr’s word for it and implement a transparent goal setting/achievement process to foster company-wide motivation.
Another Google alum, Ken Norton now works as an executive coach to product leaders. He recommends implementing OKR frameworks to help manage growth. OKRs can be invaluable in helping everyone stay focused on the objectives, and in making sure that those objectives are good ones: “OKRs make sure the company is staying ambitious, setting objectives that are measurable, and that everybody in the company knows the few things that are most important.”
Norton says that what makes OKRs good are their simplicity, their ambition, and their measurability. In order to succeed, Objectives and Key Results must be small in number and must feel ‘audacious’ and difficult to achieve. However, they must also be measurable so that it is possible to tell whether they have been achieved, or to what degree they have been achieved.
Ken Norton suggests that if a company has set a goal to reach a specific peak, the details in how to do so will simply follow as everyone works toward the share goal. Any tensions that arise can then be used as tools to advance company culture, therefore allowing OKRs to not only lead company advancement but to improve collaboration as well.
The former Airbnb Product Lead, with experience at Dropbox and WeWork, is also a fan of OKR. She states that OKRs are not for use in funnels where the metrics are already self-evident, but rather in situations like new product lines which might yield more risks. Zhang adds that it’s “critical to get alignment on the O” – it is, after all, the objective that all company employees must be working towards. Making sure there is no confusion on the O then leaves its place to the KRs, and to making sure that “those are the right levers to get to your objective.” In other words, if you have a crystal clear goal and the right measurements to evaluate it by, you are more likely to lead your vision to fruition.
Former LinkedIn CEO Jeff Weiner believes that behind every thriving tech company is a clearly defined ‘mission’ and ‘vision’ that it lived by every single day. Weiner defines ‘vision’ as the objective, the aspiration that keeps everyone inspired, and ‘mission’ as the key results, the ways in which the company will achieve its objective. According to Weiner, value-based leadership that drives unified goals is what is most likely to lead a company to success.
Weiner also believes that OKRs can help you stay ahead of your competitors: “Strategy is navigating the competitive landscape to achieve your objectives,” he says, adding that this in itself is why repeating the vision is imperative. “You have to repeat the mission. You have to repeat the strategies, objectives, your priorities, and take the time to define who you are and who you want to be culturally.” This repetition helps internalize the objectives and key results that the company strives towards, ensuring that it stands out within a saturated market.
Costolo is another Google alum that carried his Google OKR learnings into his next company: Twitter. Costolo believes OKRs are “a great way to help everyone in the company understand what’s important and how you’re going to measure what’s important.” He adds that rapid company growth makes it extremely difficult to ensure effective communication, which is why OKRs can come in handy when scaling up. They are a “great way to make sure everyone understands how you’re going to measure success and strategy.”
And there you have it! If evidence from Google, Airbnb, LinkedIn, and Twitter isn’t enough to convince you to look into implementing OKRs, we don’t know what is. So take the time to define your O and your KRs, or your vision and your mission as Jeff Weiner would say, because they will be your guiding stars in leading your company to growth and success.