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Every quarter, Meghna’s organization encourages its managers and employees to set objectives and key results or OKRs as a measure of performance. Appraisal season is based on these key results, determining whether employees get a promotion, incentives or a raise.
Meghna gets nervous around each performance cycle because she’s unsure how to set her objectives. Her manager guides her on how to make sure her goals are measurable with key results.
For instance, if she’s adding project management to her objectives, decreasing the turnaround time is a key result. Meghna finds the practice daunting but understands its importance. It’s a fair and comprehensive performance measurement tool.
Discover the meaning of OKR and its framework adopted by organizations like Netflix, Google and even government bodies.
What Is OKR?
OKR stands for objectives and key results in a bid to accomplish time-bound and measurable goals. Goals are stacked against key results to monitor whether they’ve been successfully achieved. Your key results serve as the benchmark that guides your actions and ideas to achieve your objective. For instance, your objective may be to pitch to an investor. Your key results then determine each step toward your objective—preparing and delivering the presentation, and following up with a plan based on investor feedback.
You can have any number of key results to achieve your goal. As long as you’re able to measure them within a stipulated time—usually three months—you can create your key results as needed.
What Is The OKR Framework?
The OKR framework takes an outcome-based approach. It’s not just about completing your work on time, it’s about measuring your results to make sure you optimize your output.
Organizations are relying on the OKR framework for their performance cycles because employees find that it’s fair, accountable and streamlined. It helps align organizational and individual efforts, highlighting areas that need attention.
Let’s deep dive into the OKR framework and understand how to track objectives and key result areas:
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Align Organizational Goals With Team And Individual Goals
The first step is to set specific goals for the organization that can be communicated across teams and functions. For example, the organization may decide to grow its business in an international market. Efforts by department heads and managers should align with this overarching objective. The sales team must focus on generating leads to further this ambition, marketing must comply with social and brand advocacy efforts to contribute and the product team can test new and improved technology to add value to the brand. Each department is aligned with the organizational objective. This helps streamline processes and procedures, getting everyone in the organization on the same page.
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Set Specific Organizational And Team Goals
Once you’ve been notified of organizational goals, you have to communicate internally to make sure your goals are specific. The organizational objective will be broad, like a revenue target of Rs 10 crores. But departmental and team goals need to be specific. For instance, the product team can be tasked with improving the website. Their goals can be improving the user experience, developing a new mobile application or optimizing the existing offerings for a new or wider market. Specific goals enable specific efforts in the right direction. If your goals are vague or too broad, you won’t be able to identify whether they’re effective. Managers have to come through and help employees understand OKRs and how they work.
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Ensure Goals Are Time-Bound And Measurable
If the organization wants to triple its revenue in three months or the next quarter, employees have to set goals that are time-bound. You can’t add objectives and key results with a six-month timeline. They have to be accomplished in three months. Only then will they add to the overall goal-setting effort. OKRs are only as effective as collaborative efforts. The second thing is to make sure your objectives are measurable. Your key results will help you measure your progress. For instance, if you say you want to help improve brand positioning in the market, your key result can be implementing SEO best practices for improved Google search rankings. Time-bound and measurable objectives and key results lead to optimal outcomes for you, your team and the organization at large.
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Calibrate Objectives With Key Results
At the end of the quarter, leaders and management have to calibrate team and individual objectives with key results. This process is important because this is where you can analyze whether the performance cycle has been successful. If any discrepancies are found, you may even have to justify or explain them with evidence or support. This also encourages you to be accountable for your actions throughout the process. It’s a nudge in the right direction because you know there’ll be calibration in the end. If during the cycle, you’re facing setbacks, you must reach out to your manager to reorganize or assess your goals for the quarter. Avoiding any problems that may crop up will help you in the long run.
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Identify And Evaluate Areas Of Improvement
Once the calibration is complete, managers and employees can work together to set up a task force to understand why some areas are lacking. Even though you have complete control over your performance, as they’re measured at each step, you may still slip in a few places—it’s human to make mistakes. Evaluation and monitoring make sure you improve and build the necessary skills to do better the next quarter. However, there may be cases where performance hasn’t been up to the mark or objectives haven’t been met. In such cases, managers may even use a performance improvement plan, which can lead to termination if you fail to meet its requirements.
OKRs are essential in a dynamic organization with several functions, each of equal importance. An organization works like parts of a whole. Each part must fulfill its goals for the organization to succeed. Monitoring OKRs and evaluating results enable management to improve processes moving forward. Objectives and key results may be documented and used as benchmarks to do a SWOT analysis to study the organization’s strengths, weaknesses, opportunities and threats.
Examples Of Objectives And Key Results
Examples of OKR vary within organizations, departments and teams. Each objective corresponds with a specific set of key results depending on your skills, job scope and responsibilities.
Here are some examples of OKR across functions:
- Radha is a product engineer in an organization that focuses on e-commerce and digital technology. For their quarterly targets, the organization has planned to scale up and launch an OTT or streaming service. Radha’s objective is to support post-production and localization efforts. Her specific key results are signing on ten titles in regional Indian languages, reaching out to clients who provide translation and transcription services and performing quality checks to ensure high-quality work.
- Karam is a videographer in a media house. His organization is expanding its scope to include influencer management. They’re setting up an in-house studio for YouTubers to run their channels organically. Karam’s objective is to shoot, edit and upload high-quality videos on YouTube to improve brand positioning and digital visibility. His key results comprise upskilling and learning about video editing software, shooting a specific number of videos per week and giving directions to guide influencer efforts.
- Tara is a German-language expert running her own translation and interpretation service. She has three interns who help run her website, handle marketing efforts and generate leads. For her firm, her objective is to tie up with embassies and corporations to offer classes to employees. She and her interns are focused on key results such as reaching out to, and converting, ten organizations a month, as well as improving skills such as communication, team management and sales and marketing.
Whether you have your own business or you work as an employee, you may need to set OKRs. Not only are they helpful in tracking progress but also in measuring success. You can keep a record of everything you do. This way you can revisit your tasks, assess where you did well—and where you didn’t. Objectives and key results are part of a streamlined process that can lead to business success.
Manage Your Team’s OKRs
Teams have to set their objectives and key results as per the organization’s policies. Harappa’s Managing Teamwork will teach you how to align your goals with other members of your team. Effective teams are built on trust, autonomy and communication. Learn to understand team dynamics and how to lead effective teams to achieve your goals. From understanding culture to collaborating with people across functions, you’ll learn about unique work styles and perspectives.
Also, you’ll get a glimpse into the art of giving and receiving feedback. Goal setting requires open and honest communication. Managers may give you feedback on your progress or you may give feedback to your manager. Either way, there’s a way to deal with feedback to make sure both parties are satisfied with the conversation. Our comprehensive team management course will take you through the stages of team development. Start today and become a professional who responds to challenges!
Explore Harappa Diaries to learn more about topics such as What Is Management By Objectives, Core Competencies, 360-Degree Appraisal & Organizational Structure to build strong professional networks.
