What is OKR? Definition, Examples, Templates, and Expert Tips
Every individual and business has goals they want to achieve. When we set goals and commit to achieving them, our performance improves. In the business world, setting goals and key objectives will see an improvement in employee performance.
There are two types of goals set by businesses: challenging goals and quantifiable goals. The mixture of both enhances performance.
OKR (Objectives and Key Results) is a robust framework used by businesses to plan, track and measure progress. When looking to set objectives and key results for your teams, the OKR structure is one of the best frameworks you can use.
Unlike KPIs, which are primarily data-driven, OKR combines ambition and data. In this article, we will cover everything you need to know about OKR.
Let’s get started.
What is an OKR? A Short Definition.
OKR is an acronym for objectives and key results. It is a goal-setting framework used by individuals and teams. What sets OKR apart from other goal-setting frameworks like KPI is that it offers the opportunity to set ambitious and challenging goals. However, you have to back it with measurable results.
OKR as a collaborative goal-setting tool keeps teams and individuals on course to achieve their measurable goals. OKR can be used to set financial goals at different company levels and also personal goals.
At its core, OKR consists of two variables: objective and key result. An objective is what you plan to achieve. They have inspirational and action-oriented values and are the building blocks of all goals.
According to Merriam Webster English Dictionary, an objective is ‘something toward which effort is directed: an aim, goal, or end of the action.’ Objectives make our thoughts and ideas concrete and move us a step closer towards execution.
The key result, which is the second component that makes up the OKR, is the benchmark we use to measure progress towards our objective. They make the objectives work.
Objectives without key results are no different from mere wishes. Unlike objectives, key results are measurable, verifiable, and time-bound.
At the end of the key result time frame, it represents an opportunity to evaluate if the objective set was fulfilled or not. Objectives are fixed and long-lasting, while key results can change as the work progresses.
OKRs are analyzed, set, tracked, and evaluated quarterly, according to the goal-setting system the search engine giant Google uses. However, it is not a standard timeframe. Different companies and industries can use alternative timeframes that work for them.
The beauty of OKR lies in its speedy process and its inclusion and suitability for top-bottom and bottom-top analysis. With the framework, teams can move in the same direction without overriding each other.
How Do OKRs Fit Into Your Goal Setting
OKR is a goal-setting framework used by companies to set goals and track their results. We have discovered extensively in previous sections the meaning of OKRs. Let’s switch attention a bit to understanding what ‘goals’ mean.
What Are Goals?
Goals mean different things depending on the context of usage. For businesses or organizations, they are the desirables that a business or organization plans to achieve at a future date.
Merriam Webster English Dictionary defines a goal as “the end toward which effort is directed.” Cambridge English Dictionary defines a goal as “the act of stating clearly what you want to achieve or what you want someone else to achieve.”
Setting a goal reflects the commitment to achieve a result. Goals are guides that help businesses and individuals to focus their efforts and resources on what is essential. They take two forms: overarching and operational.
The overarching goals focus on the business’s big aims, while the operational goals focus on the smaller aims such as department or team goals. Ensure you keep everyone in the company that has a role to play updated about the company’s goals.
Goals vs. Objectives
Differentiating goals from objectives are challenging. The similarities between goals and objectives are too close; it is hard to tell if a difference exists. Goals and objectives both talk about the desired outcome. In many situations, they are used interchangeably.
Separating goals from objectives is a technical matter. With OKRs, there is no need to differentiate between both terms.
SMART Goals vs. OKR
OKRs is a goal-setting framework. The difference between goals and OKRs majorly lies in its application. OKRs are mostly used for businesses, while goals have a general usage.
The SMART goal acronym that stands for smart, measurable, attainable, relevant, and time-bound helps you achieve your target.
However, it is difficult to use this goal-setting formula to track company-wide or department goals. The SMART goal-setting formula is a better fit for individuals.
OKR fits into your goal-setting plan for your organization or company. It drives alignment across the board in your company. The framework does this by creating objectives and key results that are measurable and easily understood at both the team and company levels.
The objective set using OKR should be something that gives a clear direction. For example, the objective of a company is to expand its production chain into Asia.
The key results are the measurable or quantifiable expressions, usually in a numeric form that tracks the progress towards your set objective. When setting your key results based on your objective, be specific and only use the key results.
OKRs and Stretch Goals
The idea of setting goals beyond what seems feasible can be done effectively with OKRs. Google, the internet giant, does this well. They deliberately set goals beyond the threshold of their team’s capacity and then work towards its accomplishment.
Stretch goals push you beyond your boundaries and help you unravel your strengths. However, creating these stretch goals is you setting your team or company for failure. While you may not hit 100% of your OKR with stretch goals involved, every attempt signals a significant advancement for you.
When you use stretch goals in your OKRs, communicate a clear expectation and threshold for success. Achieving 100% of your OKR is an extraordinary performance. Google sets its OKRs success mark at 70%.
View stretch goals as an opportunity for your team or departments to push the boundaries of their performance. Setting high goals also improves the quality of workers at your disposal.
Good and Bad OKR Examples
OKR has been responsible for the extraordinary growth of many companies, including Google. However, for some organizations, OKR has not proved as effective. In this section, we will look at good and bad OKR examples.
Several factors play into what makes a good OKR and a bad one. The chief determinant of whether an OKR is good or bad is its adherence to the OKR framework (objectives and key results).
Good OKR Examples
Here are some good examples of good OKRs.
Let’s assume you have gathered your team to discuss the OKRs for your organization. Here is the likely path the meeting will follow.
First, you will want to define the objective.
Objective: To increase the company revenue in the next two quarters.
After you have laid out the objective, the next step is to set the key results to achieve the set objective. For this example, there are three key results.
Key Result 1: Employ five more salespeople to help out the sales department
Key Result 2: Sell over 1,000 units of products monthly
Key Result 3: Secure more long-term subscribers for the product
For this example, there are three key results to help achieve the objective. The OKR objective for this example can even be clearer if we add a figure to the objective.
Objective: To increase the company revenue by 10% in the next two quarters.
The number of objectives and key results you can have is dependent on the needs of individuals and teams.
According to Whatmatters, inspired by Google, you should have three to five objectives to capture your organization’s ambition. Also, for each objective you set, there should be two to five key results attached to it.
Let’s assume the American car company, Chevrolet. The company wants to switch over from making cars that are not environmentally friendly to clean electric cars. The Unique Selling Point (USP) that will appeal to their target audience is eco-friendly cars.
Here is how Chevrolet’s executives will draw it into an OKR framework.
Objective: To design and create electric cars that offer the highest environmental value to consumers.
Key Result 1: By 2024, 100% of Chevrolet products will use an electric motor instead of diesel or petroleum.
Key Result 2: To be the leading electric car producer in the American subregion by 2029.
This OKR expressly clearly the objectives and key results the company wants to achieve. Every person involved in turning the objective into a reality can easily see what the company wants to achieve. They will have a clear perception of what the company expects from this guide.
Let's see how OKR can work for a different kind of team, the soccer team. The manager of a professional team can use OKR to set an objective for the team.
Objective: To win the Championship.
Key Result 1: Win an average of 2 points per game throughout the soccer season.
Ket Result 2: Average a goal difference of 2 or more goals per match throughout the soccer season.
Key Result 3: Have an average possession of 60% per game.
From this OKR, the overarching objective the team wants to achieve is to win the championship. The key results reflect an attacking-minded team that wants to win it with an attacking style.
Let’s take another example of a successful OKR with a focus on the individual business. Assume you are a freelance web designer and you have a problem getting clients to find out about you. You have used freelance jobs websites, and you are still not getting clients.
You can use the OKR goal-setting framework to help solve this problem.
Here is the form your OKR will likely take.
Objective: Build a website for my freelance web designing business.
Key Result 1: Research and purchase or get a free domain name by March 31.
Key Result 2: Write 10+ blog posts of your website with an SEO strategy and publish by April 14.
Key Result 3: Promote your website on your social media platforms and use ads by April 15.
Key Result 4: Get your first web design job from a client by April 30.
Bad OKR Examples
A bad OKR example is the exact opposite of a good OKR example. While flexibility is a key feature of OKR, if it is done to the extreme, it becomes a bad OKR example.
When you create an OKR that is unrealistic, not measurable or doesn’t have a timeframe attached to it, it is a bad OKR.
Here are some examples of bad OKR.
Objective: Provide new employee benefits packages. (No outcome)
Key Result 1: Train employees on how to use the benefits platform (not measurable)
Key Result 2: Update company’s database with employees’ new benefits
A better OKR would concentrate more on measurable outcomes. Here is a better solution.
Objective: Improve your employee satisfaction.
Key Result 1: Enroll 90%+ of your employees into a better benefits package.
Key Result 2: Move employee satisfaction score from 6.0 to 9.0
Objective: Make Viral Videos on YouTube
Key Result 1: Improve Youtube SEO
Key Result 2: Get more followers on YouTube
Key Result 3: Earn more money from YouTube
This example is not an OKR objective and key results, rather it is an objective with its list of tasks. Objectives can be aspirational goals, but key results must be a measurable reflection of the objective.
Getting Started with OKRs
OKR is a simple and easy framework that anybody can structure and streamline for their teams. Once you understand what makes good objectives and bad objectives, there is no limit to the number of OKR structures you can create.
It is possible to express OKRs with software or spreadsheets. If you are just starting with OKR, here are five steps that will make your journey a delight.
1. Set Your Objectives
Start your journey into the OKR goal-setting framework by choosing one objective for your organization. As you grow in your understanding of how OKR works and its impact on your company, you can start adding more objectives.
However, while there are no limits on the number of OKR objectives you can set for your business, Google recommends not more than five.
Remember you are setting objectives to achieve them, and just as a mere listing competition. When your objectives become too bulky, it will be easy to lose track of many of them and achieve little at the end of the day.
Keep your objectives within a limit where your teams can easily go after them and keep track of them. For many organizations, five is the limit.
Setting objectives for your organization is not enough. You have to explain the overall company objective with your various teams. Your set objectives will serve as a guide for your team's objectives. Each team’s objectives should align and work towards achieving the company’s goals.
When setting your OKR objective, it must have the following features: ambitious, actionable, qualitative, and time-bound.
2. Define Your Key Results
For every objective that you set for your organization, ensure you have three to five measurable key results under it. The essence of having clear key results is that they are the measurements by which you achieve your objective.
Set your key results in such a way that if you meet them all, you automatically crush your objective. Objectives and key results go hand in hand in the OKR framework.
One characteristic you key results should have is that it must be measurable and easy to quantify. Unlike objectives, which are somewhat vague statements, key results are outcome-based.
Here are some of the most popular ways you can set up measurable key results.
- Increase (the tangible, e.g. sales) from (former position) to (future position)
- Reduce (the tangible, e.g. costs) by (the target)
- Improve (the tangible, e.g. customer satisfaction) up to (the target)
Key results are an important part of the OKR framework. They measure and track progress towards achieving the objective. It is essential to note that key results do not stand on their own but are inspired by the objective set.
Here are some more explicit examples of key results.
- Increase sales of detergents from 100 cartons a day to 150 cartons a day by the 30th of March
- Improve customer satisfaction up to 85%
- Reduce the business running cost by 5%
Key results can be based on several metrics such as performance, engagement, growth, and revenue.
3. Update Your OKRs
After setting your OKR, find time to track your team’s progress before the due date for accomplishment. Waiting till the timeframe set for the OKR, usually quarterly, to arrive before evaluating the process leaves no room for adjustments.
Ideally, you should go over the OKRs set for your team every week. During the review, you can make some corrections and adjustments to the OKR. This constant evaluation will also pressure your team to perform and bring meaningful results before the next review.
4. Plan Your Activities
When planning your organization activities for the week, ensure you put OKR as one of the activities to do in the week. The OKR activity should represent the time you spend focusing on the objectives of the company. Write down your thoughts.
- What are the best plans and projects we can do as a company to achieve our objectives?
- Are the current company’s plan taking your company towards the attainment of its objectives?
- Why are our weekly targets not being met?
- What can we do differently to achieve a better result?
When you plan your activities, you are better positioned to see the distractions you need to avoid and score your efforts to achieve your objectives.
5. Review your OKRs
The last step you need to take during the lifespan of your OKR is the review. At this stage, you review how your organization and teams perform in light of the OKRs set.
This review stage happens at the end of every quarter. It is an opportunity to see what your organization is doing well and its areas to improve on.
At the end of each quarter is an opportunity to gather your team together, evaluate the current performance and start planning towards the next OKR target.
Every company should conduct an OKR review at least a minimum of two times a quarter. It is an opportunity to discuss the challenge, share ideas and make recommendations for better OKR.
What’s Unique About OKRs?
There is no standard manual for how to form or use OKRs. The sheer diversity of individuals, organizations, and teams and their different needs makes it impossible for a rigid OKR rulebook.
Companies adapt and adjust OKR to fit their goals, showing the OKR framework’s flexibility across different companies and industries.
Although there is no single way to use it, some core concepts are generally acceptable as unique elements of OKRs.
1. Agile Goals
OKR offers a more dynamic and agile approach to planning and goal-setting. Instead of using a static annual approach, it breaks down the process into shorter cycles in quarters.
Not every company uses the three times a year framework; some have even shorter timeframes for reviewing OKRs. With shorter frameworks, organizations can set agile goals and track their progress more efficiently than with an annual approach.
OKR is a simple framework that does not involve any complex calculations or terms. It is a lightweight process that is by far the most straightforward framework for goal-setting.
There is no learning curve to understand how it works. Employees in the organization can easily understand the objectives and key results contained in the OKR with minimal hassle.
One massive advantage of OKR is that it does not take much time to set. Unlike KPIs, which are more complex and can take time to set up, OKR allows you to focus more on achieving your goals than setting them.
OKR helps create a high level of transparency in an organization. With its easy-to-understand structure, it helps create alignment in the company.
OKR is not a hidden document that the only tip executes can access. Everybody in the organization has access to the OKR and can view them, look where they fit in and play their roles towards its attainment.
4. Nested Cadences
OKR helps solve the dilemma of combining strategies and tactics in an organization. Strategies often have long-term implementations while tactics are prone to adjustment. To find a balance between these two divides, OKR adopts three different cadences.
- Strategic Cadence: This cadence refers to the highest level possible. It refers to those OKRs that are set for the organization. The time duration is usually a year.
- Tactical Cadence: This type has a shorter duration, usually set for quarterly. They are often OKRs for teams in the organization.
- Operational Cadence: It refers to the tracking and monitoring of key results or actions usually done weekly.
5. Bidirectional Goal Setting
For too long, goal-setting has been about a top-down cascading model that burns valuable time and does not produce the best results.
While goal setting is important, the technique should not cost you hours to develop. Also, the up-down cascading model is challenging for tracking purposes.
OKR does not make use of this model. It allows greater room for flexibility. The OKR framework is a more market-oriented approach, combining the bottom-up approach and the top-down goal-setting approach.
The way it combines both approaches lies in its direct levels of application. For example, in an organization, they are strategic OKR which everyone working there should know (top-down approach).
Then, while following the strategic OKRs, each team also has their tactical OKRs, which they have to accomplish (bottom-up approach).
For many organizations, the strategic OKRs are the minority for teams, who focus more on the tactical OKRs. This arrangement’s beauty is that it makes everyone have a clear understanding of the organization’s strategy.
OKRs are simpler to implement compared to the traditional top-down cascading model.
6. Ambitious Goals
Many people think that OKRs are too ambitious; they are not too far from the truth. The philosophy behind setting OKRs is not to make the goals easy to accomplish. Rather, goals that are difficult for a company to reach 100% are what should be set.
These types of goals are called stretch goals because they push us to expand our capacity. They are bold and ambitious and are better viewed as team challenges.
The difference between OKRs and wishful goals is that you can achieve a significant portion of them. The ideal recommendation that an organization should achieve of their OKRs is 70%. By setting ambitious goals, organizations can stretch the capabilities of their workforce to reach peak performance.
7. Decoupling Rewards
OKR works best when it is separated from rewards. Once there is a reward attached, employees will take the safe route and set goals that they can easily reach.
Remove the fear and doubts that your employees will have in a performance-based system by detaching rewards from OKRs.
Organizations should adopt better reward systems that take into consideration employees' impact on the business. OKR should not be the only evaluation total used for employees, but one of them. It is best used as a management tool.
Benefits of Using OKRs
If you check the number of big organizations such as Google, Netflix, and Adobe that use OKR, you will be extra eager to know the benefit it brings to the table.
Here are the five key benefits of OKR.
OKR helps you focus on achieving your objectives by simply causing you to reduce the number you set. The fewer objectives you set, the more effective the OKR is. It is advisable not to set more than seven objectives at any given time. Also, restrict your key results to a maximum of five per objective.
Because of these restrictions, you are forced to focus your OKR on the areas that matter for growing your organization.
The second benefit of OKR is alignment. OKR allows for the company’s objectives and those of individuals to be in alignment with each other.
The strategic OKR is set at the executive, top or strategic level in any organization. It forms the basis for any other tactical OKR needed to guide teams and departments in the organization.
OKR ensures that all teams’ day-to-day activities and goals run smoothly without any issues.
OKR is flexible and does not involve traditional long-term planning. You can set shorter goal cycles or longer ones depending on the organization’s needs. However, whether you choose to go short or as long as a year, you need to review your OKR at intervals.
4. Achieve Beyond Expected
OKR sets goals beyond what the team can achieve to get them to reach peak performance. That explains why OKR does not require only 70% as a success rate.
OKR benefits the organization and employees. For the organization, it helps it achieve more from its employees. At the same time, the employees gain personal growth and grow capacity to achieve their OKRs.
Short History of OKRs
Andy Grove created the OKR framework while he has worked for Intel. His OKR idea was documented in his 1983 book “High Output Management.”
He is the genius behind two questions that reshaped the perception of management in his time. Those two questions are: “Where do I want to go?” and “How will I pace myself to get there?”
The history of OKR can be tracked by Peter Druker in the 1950s, who created a similar framework, “Management by Objectives.” Druker is known as the ‘father of modern management because of his revolutionary ideas that transformed the management scene.
Today, everyone, by default, sets management goals by objectives. It was some of these ideas, such as the “Management by Objectives,” that influenced Andy Grove to create OKRs.
Before OKR came, other goal-setting platforms such as SMART goals (developed by George T. Doran) in the 1980s and Key Performance Indicators (KPIs).
John Doerr, who worked with Grove in Intel, introduced the framework to Google in 1999 and gave it the name ‘OKR.’ He knew about it as far back as 1974 when he joined Intel. Doerr is credited with making the OKR as popular as it is today.
Since Google adopted it and experienced massive success, many companies such as Netflix, Twitter, Walmart, The Guardian, Shopify, Airbnb, and others have adopted it. Today businesses, organizations, and even individuals make use of the goal-setting solution, OKR.
While the OKR frameworks remind the same at their core, there is no doubt that a lot of explosive changes have occurred since Google used it. One of such changes is the number of people using the framework.
Another massive gain is the emergence of technology to make OKR even better. There is now a host of OKR software that you can use to create your OKRs and track them.
Common OKR Mistakes to Avoid
People make mistakes all the time when creating or implementing their OKRs. If your OKR is not created properly, it has a high chance of failure. Here are some of the common OKR mistakes you should avoid making.
1. Setting Non-Measurable Key Results
Non-measurable key results in OKRs are a common mistake that many people and organizations make when setting up their OKRs. It shows a lack of understanding of the framework.
When you fail to set measurable key results to achieve the set objective, your OKR is nothing more than wishful thoughts. According to John Doerr, the genius who brought the OKR formula to Google, which led to its wide acceptance, ‘every key result has to be measurable.
2. Setting Too Many OKRs (Objective or/and Key Results)
Another common mistake people make when setting their OKRs is setting too many of them. Ideally, you should not set more than seven objectives for your OKR, and under them, the key results should be a maximum of 5.
Once you make your OKRs longer than it, it becomes hard to track and a mere list of achievements. Your OKR should be a list of your top priorities. With fewer objectives and key results, you stand more chance of success.
3. Making Your Key Results A List of Tasks
One mistake that many organizations make when setting their OKR is to make their key results a mere computation of tasks. Key results are not tasks that you do; they are the outcome you want to achieve.
When setting key results, ensure it is not a list of actions but successful outcomes. Once you make it a list of tasks, it loses its effect.
4. Using the Top-Down Approach when setting OKRs
OKRs do not involve any top-down or other cascading approaches. They are simple goals that everyone in the organization plays a part in its success.
5. Lack of Communication about OKR
If you create your company’s OKRs in a silo without carrying other team members, your OKR will be difficult to accomplish. Communicate the OKRs to every team member, let everyone know the part they have to play. Clear communication is vital for the success of your OKRs.
Remember you are not setting OKRs for yourself, so carry along relevant team members in the planning and implementation stage.
6. Setting and Forgetting OKR
Another reason why OKR fails is because of people’s lack of understanding of how OKR works. Many people treat OKR like they would a new year resolution. They write it down with great enthusiasm and do not open it again till the end of the year.
OKR requires active reviews to evaluate the progress the organization or teams are making towards the set objective. Tracking OKR and holding discussions about the implementation process should be a part of an organization’s culture.
7. Using OKR as a Compensation Tool
When you use OKR in some sort of compensation formula to reward employees, you are defeating its purpose. Employees should work together towards achieving OKRs and not compete against each other. OKR is not an employee evaluation tool but a management tool.
Tips for Writing Effective OKRs
Writing effective OKRs involves writing good objectives and key results so that they can complement themselves.
Before you write an OKR, the first thing to get right is the objective. After you have set the objective, you can now concentrate on the key results to achieve the objective.
Tips for Writing Good OKR Objectives
1. Keep it Simple and Easy to Memorize
When writing your objective for your OKR, keep it simple and short. Avoid using long terms with vague meanings that your members cannot easily memorize. Let it read like a slogan.
If you cannot read out your objective in one full breath, then there is a huge chance that other team members will struggle to memorize it. By making it simple, you increase its likelihood for success.
2. Keep it Interesting
Your OKR objectives should not give that boring appeal. It should be something that the employees in the organization will feel excited about achieving.
The best way to achieve this effect is to write it in a tone or style that aligns with the organizational culture. If your organization takes an informal approach to communicate with employees, you can freely use slags in the objectives.
For an organization with a more formal approach, avoid using difficult technical terms in your objectives. Keep it simple and interesting for every employee in the company to comprehend.
3. Spend Time Thinking About The Objectives
Avoid rushing to set objectives for your OKRs. Spend some time thinking and researching about the suitable objectives for your organization. You can interact with team members and have them contribute to this all-important decision.
Here are some questions you can use to help you identify the best objectives for the OKRs.
- Are the objectives a fit for my company?
- Do they help the company achieve its goals?
- Are they inspiring?
- Can my team accomplish about 70% of it within the time frame set?
- Do they contribute to the growth of the company?
- Are they actionable and easy to understand for employees, or do they need more clarification?
4. Objectives Should Not Be Easy
OKR are ambitious goals, and no part of them should be easy to achieve. When setting up an objective for your organization, if you find yourself achieving it with minimal effort, you are setting a goal, not an OKR.
While it is common to achieve your objectives within three months (the duration set for most OKRs), if you find yourself achieving your objectives earlier, it is a sign that you need a new objective.
Although an OKR should not be easy, it should also not be too difficult that it is impossible to achieve. OKR should stretch and challenge the organization and your teams to perform at their peak.
If it is easy to achieve your objectives way before the due deadline, your objectives are not good enough for an OKR framework. While reviewing your OKRs, you can increase them to make them more ambitious.
Having a 100% minimum expectation for your OKR is unrealistic. If it is ambitious enough, the organization will likely not reach the 100% mark. A success rate of 65%-70% (about two-thirds of the grade) is still an impressive achievement.
However, while you expect a less than perfect scorecard for the OKRs at review, never have your employees settle for that mark. Keep them aiming for 100% and find new dynamic ways they can reach it.
5. It Should Be Time-Bound
Never set OKRs that do not have any duration attained to it. Your objectives should be time-bound. Set a time where you expect your employees to accomplish the objective to a satisfactory extent. The common timeframe for most OKR is quarterly.
Tips for Writing Good OKR Key Results
1. Set Only a Few Key Results Per Objective
Like objectives, key results are not a compilation of tasks. Organizations should limit them to between two and five per objective.
When you set more than five key results per objective, it immediately loses its appeal, and it is hard for employees to focus on all.
2. Keep them Specific, Measurable and Achievable.
Your key results should be specific and communicate the outcome you want to achieve. It should also be easy to quantify or measure. While you want to set ambitious goals, make sure they are not impossible to achieve.
3. Use Numbers
Numbers enhance the appeal of your key results and make them measurable, achievable and actionable. A key result with numbers will take a resemblance to a task or plan. Let your key result reflect the outcome and regularly review it at short time intervals.
4. Write Outcomes, not Task.
Key results are measurable business outcomes and not tasks that have to be completed. Your key results should read as the outcome you want for your organization and not the task you want employees to perform.
Best OKR Software for Aligned Goal Setting
Several OKR software makes it easy for organizations to use OKR the right way as a goal-setting framework.
Best OKR Software with Interactive Dashboard for Teams
Betterworks is an OKR software that helps companies keep all team members focused on the right goals. With the software, you can set transparent and aligned objectives which everyone can view.
The software tracks the progress of the goals in real-time and allows for cross-functional team alignment. You can give feedback on performances from the platform. Anyone of your team members can also give feedback and replies easily.
Bettrworks allows you to view the OKR progress at the company with a glance at its central dashboard.
Best OKR Software for Remote Teams
15Five is an excellent software for tracking team performance. It is a performance management solution that tracks OKR and other performance-related frameworks. Companies use the software to get the best value out of their employees.
The platform provides you with the right teams you need for your remote team. 15Five is a tool that offers immense benefits to managers and employees.
For managers, they get a rich collection of tools to effectively track and monitor their teams. Employees enjoy a transparent platform with multiple support for their development.
15Five allows users to align their individual goals to the company’s objectives.
Best OKR Software with Multiple Integrations
Ally's OKR software keeps teams, leaders and individuals connected and focused on the right outcomes. Everyone can visibly see the company’s important objectives and view how they contribute to its growth.
The platform helps managers and employees stay focused, engaged and motivated to achieve the OKR set for the company,
Ally integrates with your everyday software and apps for more convenient goal-setting and management. Some of the integrations include Slack, Microsoft Teams, Asana, Excel Online, GitHub, Google Sheet, Hubspot, Salesforce, Trello, and Zendesk.
Most Intuitive OKR Software
Profit.co is one of the best OKR software for individuals and organizations. The onboarding process is simple and does not require a learning curve.
You can use it to align your team’s objectives with the organization’s OKR. It gives you a vivid chart picture of how your teams are aligning with each other.
Profit.co has multiple integrations such as Google, Slack, Microsoft, Zapier, Jira, and Office365. It has a mobile app that makes it easy to track OKR from on the go.
Best OKR Software for Large Companies and Later Stage Startups
WorkBoard is an OKR software that helps businesses grow and achieve their objectives. The platform ensures everyone is aligned with their strategic priorities and OKRs.
With its dashboards, you can track the progress of the OKR, set smart meeting agendas and OKR reviews.
The biggest advantage of this software is that it offers access to OKR expert coaching. With this service, you get expert services and training for you and your staff.
With its Enterprise Results Management feature, you can align OKRs across the organization, automate business reviews, coordinate and collaborate on actions.
Best OKR Software for Goal Tracking and Progress Reporting
Weekdone is an OKR software that allows you to align your company’s objective and set actionable goals that bring results. It has one of the best OKR suites that offers everything you need, including tools for goal tracking and progress reporting.
Users enjoy comprehensive OKR coaching and support such as personal OKR coaching, company training plan, and live OKR help chat.
Weekdone integrates with Slack, Microsoft Teams, Jira, Asana, and Basecamp
Quick OKR Implementation Guide
Implementing the OKR framework is the natural next step after learning its basics. The first decision to make is to decide which team(s) need to use the OKR.
1. The Pilot Team Structure
This structure involves focusing on one team first before expanding it to include other teams. With this structure, you get a miniature taste of what the OKR levels in your team will look like and use these results to build OKRs for the rest of the organization.
2. The Team Leaders Structure
This structure involves setting OKRs for only team leaders. With this structure, you can test and solve alignment issues with the overarching company goals. You can also connect the team-level (tactical) OKRs to the strategic (overarching) company OKR.
The advantage of using his approach is that it can lead to a massive shift in mindsets and produce huge results for organizations. Once you get the onboarding stage correctly, the rest of the employees can see that it works and take a more goal-driven approach.
3. The Everyone Structure
This structure is one of the most difficult to implement for companies. The reason why it can be daunting is that you have to add everyone to the OKR. However, it is the best structure for companies with flat hierarchies and even small to medium-sized businesses.
A typical OKR takes about two to three quarters before its impact starts to manifest to the organization. The sooner you bring everyone on board to the OKR, the quicker you will achieve your results.
What To Do A Week Or Two Before Starting with OKRs
Before getting started with OKRs, there are a few in-house tasks you need to accomplish.
1. Define Your Quarterly Company Level Objectives
Before you start with OKRs, it is important for you to first define what constitutes your Quarterly Company Level Objectives. These objectives refer to the goals your company wants to achieve within a quarter interval.
You can also decide to go long-term and set annual objectives. However, they have to connect with your quarterly objectives.
2. Focus on A Few High-Level Objectives
When starting with OKRs, concentrate on setting only a few high-level objectives. The recommended maximum number of objectives is three.
Setting a few high-level objectives will make a more realistic goal-setting. Having a large number defeats the purpose. Discuss your selected high-level objectives with managers and team heads.
At the team level, repeat the same process. Get your team heads and their members to interact with the important goals for the team. Ensure that whatever goals they agree on should align with the company’s objectives.
Write Key Results and Not Tasks
When setting out with OKR for the first time, it is easy to mistake tasks for key results. Your OKR framework does not need a task; it needs only the objectives and key results.
The difference between task and key result is that task reflects actions, while key result shows the outcome.
Let’s assume we are planning for an event. There are many things we need to do to make the event a success. We have to rent the hall, hire catering, invite a DJ, and other logistic calculations. Now everything mentioned here is tasks.
If we are to set key results for our objective, which is to host a successful party, this is the form it will take.
- Get 1,000 guests
- Feature in the local news channels
- Add 500 new subscribers to our event planning Youtube channel.
Every team in the organization should conduct weekly check-ins to evaluate their performance towards the attainment of the OKR. A consistent check-in process is important for the success of the OKR.
If you choose to wait till the quarter to check how far your team has progressed, there is little room for corrections and readjustments along the way. OKR is a continuous evaluation process that does not end till the objective is achieved.
Also, weekly check-ins keep workers on their toes to perform at their peak. When this option is unavailable, their performance can drop in the absence of such continuous evaluation.
Hold Meetings Once A Month
Apart from the weekly check-in, hold a meeting every month between the top tiers involved in the OKR (managers and team leaders). The purpose of the meeting is to identify problems confronting the OKR and brainstorm solutions to them.
Before The End of the Quarter
Organizations should review their OKR and track the progress made towards it at all levels before the end of the quarter. Ideally, a week or two before the quarter ends. It is time to review the quarter and start planning for the next one.
Objective and Key Results FAQ
OKR and KPI are both tools for tracking goals for individuals and organizations. However, they differ in terms of the methods used to go about measuring and tracking goals and objectives.
The difference between OKR and KPI can be found in the full form of their acronyms. OKR is full for Objective and Key Results, while KPI is full for Key Performance Index.
KPI tracks the operation of your organization, while OKR is all about objectives and key results. Because of KPI measures, they form excellent key results for OKR.
For example, a book fair collects data on participants and the number who bought books; those serve as KPIs. The book fair objective is to contribute more to the reading culture in the community.
This objective’s first key result will be to grow the book fair participants by 30% by the next quarter. The second key result is to increase the number of book clubs by five before the next quarter.
From this example, you can see that KPI is more data-driven, while OKR is all about objectives and outcomes.
MBO, which stands for ‘Management By Objectives,’ was formed by Peter Drucker in his 1954 book ‘The Practice of Management.’ MBO helps organizations improve their performance. It is one of the most popular management tools in the market, alongside OKR.
The difference between MBO and OKR is that MBO is about helping you set out what you want to achieve, while OKR goes deeper than that. OKR helps you answer the what and how questions relating to your goals and objectives.
Another difference is that MBO is reviewed in the long term, usually annually, while OKR is reviewed in shorter periods, usually quarterly.
MBO is a private and confidential discussion within the organization, while OKR is public and transparent. Only a few members in the organization contribute to the discussion around MBO. For OKR, the whole team can have a say towards it.
MBO adopts a top-down approach to goal-setting, while OKR uses a bottom-up and sideways approach. MBO has compensations attached to it for performances, while OKR does not use that approach.
Another difference between MBO and OKR is that the former is risk-aversive and terms to set safe objectives that the company can easily achieve. OKR, on the other hand, takes a more aggressive and aspirational approach.
When you decide to implement OKR for your organization, one of the questions you need to answer is who should set the OKRs. Should it be the executive, team leaders, or employees?
The answer is that anyone with supervisory power can set OKRs. Organizations have two main types of OKR: the strategic and the tactical one.
The strategic OKR is usually set by the company’s top brass, with adequate consultation from the various teams in the company. The tactical ones are set by team leaders and align with the strategic OKR set.
OKR should be measurable enough for it to be attainable but not too data-driven that it starts to resemble a KPI. While it is encouraged to add figures to your OKR key results, make it simple so that everyone in the organization can easily understand it.
OKR that cannot be quantified is vague and just mere wishful thinking. Although OKR does not require as much data as KPIs, it should reflect a measurable quantity that its users can use to gauge their performance.
Google, the company that John Doerr introduced the OKR framework to, made the OKR framework popular for organizations. The way Google uses OKR has become the standard in almost all organizations.
Google set its objectives to last for a quarter and set them at the company, team, and personal levels. Objectives used by Google have the following characteristics: actionable, ambitious, and time-bound,
For key results, Google sets 3 to 4 key results per objective. They keep it measurable and difficult but not impossible to achieve.
Use OKRs to Become a Data-Driven Business
OKRs are helping modern companies shape the way they set targets and improving the performance of their team. In today’s fast-paced world, it is important to become a data-driven organization.
OKRs (Objectives and Key Result) is a collaborative tool that unites everyone to achieve their set goals. The advantage of OKR over KPI for businesses is that it is easy to learn and set up.
The idea of a quarterly time frame and weekly checks-in keeps the business ensures that the business does not lose focus on the set objective.
Setting your OKR is just half of the requirement you need to make your business more data-driven. You also need to follow up on them aggressively. OKRs are aspirational and aggressive goals. It is okay not to achieve 100% of your objective, but make sure you do not go below a 70% achievement rate.