Category: OKR (Objective & Key Results)

implementing The OKR framework has helped organizations in achieving better growth rates and more aligned teams and departments. However, in order to benefit from the framework and gain similar or even better results, it is important to understand how to roll out OKRs in your organization. After all, a tool is only as good as the hand that uses it. According to a Harvard Business Review report, "In a fiercely competitive environment, businesses need their hyper-connected workers to focus their collective brainpower on reaching key milestones, generating a steady stream of insights and ideas along the way." As per report by Gallup, “Of the 70% of American workers who are not reaching their full potential, 52% are not engaged, and another 18% are actively disengaged.” OKR methodology allows for two-way communication and for objectives to cascade. This gives employees a clear understanding of company goals and sets personal and team goals to align to company objectives, increasing engagement and collective effort to achieve objectives. Depending on the size of the organization, how OKRs are implemented could be subjective. A start-up in the hyper growth phase will see a different approach to implementing OKRs than a larger organization with multiple verticals and a complex hierarchy. But certain principles and mistakes are common across organizations regardless of their size. Avoiding these mistakes can go a long way in helping teams implement OKRs successfully and should be on the list of any manager who wants a deeper insight into how to roll out OKRs. Implementing OKRs: 5 mistakes to avoid? 1 Not setting proper OKRs OKRs could be set differently. OKR could be set so that they are achievable or they could be set in a way that doesn’t guarantee success. When an OKR is set to push the limits of the team or individual, then such OKRs are called Moonshot Objectives. The team must be informed whether an OKR is committed, that is, it can be achieved, or is it a Moonshot. Teams should be able to differentiate between both. Where both the OKRs are not differentiated, then teams might not consider committed OKRs achievable and might consider them a Moonshot. On the other hand, the team might feel disheartened and demotivated if they try to achieve Moonshot OKR considering them as committed. Similarly, OKRs should not be vague. The basic framework of OKR is based on making ‘Objectives’ clear and then clearly defining how the objective can be achieved as measured by ‘Key Results’. Another mistake that people make is to consider everything that is done in the company as OKR. For instance, reconciling accounts monthly or annually is not an OKR. But increasing productivity is, as it can be defined by time spent on a particular process. An example of improper OKR would be: Objective: x10 revenue in next quarter Key Result 1: Increase traffic on website from 10,000 to 50,000 Key Result 2: Increase Visitor-to-Customer conversion rate from 1% to 2% Key Result 3: Achieve $10,000,000 in revenue 2 Too Many or Insufficient KRAs The second most important part of the OKR framework is ‘Key Results’. The entire framework is based on setting key results that can be measured to ensure whether an objective is achieved or not. If the key results are too many, then that would lead to confusion. Similarly, too many OKRs in the early stages of OKR roll-out might lead to none of the objectives being achieved. John Doerr recommends using 3 to 5 key results for an objective. The less is more. We prefer using 3 key results in many cases and set 5 results only if we don’t have another way. Key results are parameters against which the efforts of the team are measured. Proper OKR framework would require ‘Key Results’ to be set so that the team could check whether they are moving towards achieving the objective. It is wrong to consider them as tasks. Key Results are not tasks that need to be completed to achieve the objective. At the same time, if ‘Key Results’ are vague then achieving the objective would be difficult. One of the mistakes while establishing key results is to make them subjective. Key results that are specific and clear would only allow the team to assure they are working towards achieving the objective. 3 Not Pushing Limits A general culture would just involve setting up a goal and then measuring the team or individual’s performance based on their ability to achieve the goal. That is when KRAs and KPIs are considered to be one. This would not allow an organization to reap all the benefits of the OKR methodology. Leaders would need to understand that performance and completion of OKRs are different. OKRs are meant to make teams push their limits so that greater goals can be achieved. OKRs can be set two-way, top-to-bottom, and from bottom-to-top. Individuals can set their OKRs so that they are able to achieve team OKR and teams can set their OKRs so that they can achieve company objectives. But the problem is to make things easy. 4 Creating OKRs in Silos If an individual sets an OKR that only focuses on personal development, then it won’t lead to progress anyhow. OKR methodology is designed to bridge interdepartmental and interpersonal gaps. OKRs should be set so that they align with the company or team objective. From individual to team to organization, OKRs should fit like a jigsaw puzzle to form the complete picture. Working in air-tight compartments won’t lead to a coordinated effort, which is what an organization would want to achieve growth. 5 Lack of Structured Tracking or Roll-Out of OKRs OKRs are usually designed to be tracked regularly. OKRs could be reviewed weekly for better results.But if they are set to be reviewed annually, then that’s a big mistake. Then the entire OKR methodology fails. The proper roll-out of OKRs would require them to be reviewed regularly. The management and team leaders or people responsible for rolling out OKRs should make sure they have regular review meetings. Once the objective is set, if key results and efforts made to achieve them are not evaluated, then OKRs miss their purpose. Similarly, if the leaders just set OKRs and forget them, then again the framework would fall. Commitment is needed from the company for the successful implementation of OKRs. To change the wheel of the car proper tools are necessary. Working with a hammer and wrench won’t get the desired result. In the initial phase, OKR implementers might be tempted to use a spreadsheet for OKRs. For a start-up, it might work, but in the longer term, there might be a lack of commitment. So, proper OKR software might be needed to reap all the benefits of OKR methodology. Business Goal Setting Software Things to do while Implementing OKRs 1 Understanding OKR If you are advocating the OKR methodology, then you must have a clear understanding. To roll out OKRs you must define some of the OKRs themselves and explain how they would help the organization. There is a great deal of information available for beginners in OKR, which can be read by managers and teammates alike. Do not get overwhelmed by the information. Only till it makes it clear to you how to define ‘Objectives’ and what could be their probable ‘Key Results’. There are OKR softwares that can be used for proper implementation and tracking of OKRs. The process is already designed in them; all you would have to do is write the objectives and key results. When buying clothes, people usually try them to see how they fit. Similarly, it is necessary that the OKRs framework needs to be evaluated. See if the objectives that you are setting are helping move towards the organizational role. There would be some OKRs that might not work, which would be a learning step. Before the roll-out, and even during the roll-out, evaluation of the OKR framework is very necessary. Once the OKR framework is understood, then it is necessary to check whether it can be duplicated. This would also help you, as an advocate of OKR, to understand the methodology and promote it to leaders and other team members of the organization. Best OKR App 2 Build Team Approval Once you have an understanding of the methodology, it is necessary to get your team’s approval too. Even if you are part of the leader group, then implementing the system within the leadership is necessary. As they say, “Good leaders lead by example.” This would also help with what we have mentioned in the first point, set a few OKRs for the team, and see if they help in improving the performance. Various examples highlight the benefits of OKR and what they have done for organizations. An organization like Google is an advocate of the effectiveness of OKR. Examples and stats are better advocates in building positive public opinion. Like mentioned earlier, they must be able to clearly understand and differentiate OKRs. By helping the team members educate about the OKR methodology, they would be able to make the necessary differentiation. The team would also be better equipped to find out faults in the initial stage. 3 Design Cascading OKRs OKRs can be set for every level, even for an individual. The other strong point of OKR is that they can be used to align the efforts of different teams, and different individuals with the same team. So the OKR roll out must be planned in a way that it has a ripple effect. If you are implementing for a team, then make sure the OKRs could be further subdivided for team members. We did mention that KRAs and KPIs are different, but to be able to set Moonshot OKRs, it is necessary to understand KPIs. You should be able to understand the everyday performance level of the team, and then design some OKRs that motivate them to stretch their performance. It will also help in setting committed OKRs. 4 Gradual Roll Out Couldn’t emphasize more, OKRs demand commitment and should push the limits of everyone. “Implement it at the top level first. “Alongside focus, commitment is a core element of our first superpower. In implementing OKRs, leaders must publicly commit to their objectives and stay steadfast.” John Doer The OKR roll-out should be gradual. If you are trying to understand the process, it would be better to test it on an individual level. Then roll out to the team. Even when the team is involved, don’t just set OKR for everything that the team does. First set the OKRs for some of the key processes of the team. Evaluate and iterate, which would help in understanding the effect on the team. It would also help in understanding how the OKRs can be implemented from the top to the bottom. “We must realize—and act on the realization—that if we try to focus on everything, we focus on nothing.” 8 Simple Steps to Derive your OKR Success Conclusion The OKR methodology allows teams and individuals to visualize their role in achieving larger organizational goals. They must be framed accordingly. OKR frameworks could be set bottom-up, but they should be so that they align to larger organizational goals. If the company is small, or if it’s just a start-up, then OKR methodology could be implemented company-wide without causing waves of change, but if the company is big, then implementing the process company-wide might be a big task. For large companies, it might be beneficial to understand how to roll out OKRs.