What Does OKR Stand For?
OKR stands for objectives and key results. It’s used as a framework for organizations, teams and individuals to set goals that are challenging, actionable and measurable. OKR can help track progress, motivate employees and create alignment around goals.
These objectives and key results have become a central tenet of a management methodology that helps companies focus their efforts on the same important issues across the organization.
What Is OKR?
OKR is a goal-setting technique used to track progress as teams move towards achieving objectives that are ambitious and in alignment with the company vision. Google famously found the OKR framework to be an essential tool for pushing the envelope and achieving continual growth, along with other companies like Twitter and Uber.
But before defining how the OKR methodology methodology works, we need to understand what these objectives and key results are, and why they’re so important for helping companies manage their performance and set goals.
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What Are Objectives?
An objective is different from a goal or goal setting. Objectives are specific actions or measurable steps that team members take to achieve their company goals. That is, objectives are what you want to achieve in your performance management, employee engagement or brand awareness. Therefore, an objective is concrete and action-oriented to achieve the company’s vision.
What Are Key Results?
Key results are how one monitors their progress in reaching objectives. For key results to be effective they should be specific, with a deadline and measurable goals. Key results are verifiable, either you’ve done it or you’re not. They are binary in the OKR methodology. Company objectives have no gray area. Key results are checked quarterly in the OKR system and these goal-setting objectives are marked as fulfilled or not.
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10 OKR Examples
To better understand Objectives and Key Results (OKRs), let’s take a look at some OKR examples from different industries.
1. Construction Project Management OKRs
Objective: Improve time to complete from break ground to handover by 5 percent.
Key Results
- Improved equipment downtime by 5 percent
- Increased installation defect rate by 25 percent through better training
- Minimized labor downtime to at least 10 percent
2. Marketing OKRs
Objective: Increase software signups via email by 50% by the end of Q3.
Key Results
- Increased email open rate by 50 percent
- Increased email click-through rate by 30 percent
- Decreased email bounce rate by 20 percent
3. Sales OKRs
Objective: Meet the monthly sales goal by the end of March.
Key Results
- Used SEO to attract 50,000 more visitors to your website
- Used online ads to generate 5,000 clicks
- Improved social media traffic by 50 percent
4. Product Development OKRs
Objective: Create a prototype for a new product.
Key Results
- Assembled a team of experts
- Purchased all the required raw materials and components
- Secured the workers and equipment needed to produce the prototype
5. Manufacturing OKRs
Objective: Increase the number of units produced in a month by 50 percent by the end of June.
Key Results
- Conducted a process mapping analysis to visualize the current manufacturing process
- Found inefficiencies in the current production line
- Developed an improved manufacturing process
- Purchased new equipment to speed up the process
6. Strategic Planning OKRs
Objective: Become an omnichannel retailer
Key Results
- Increased email marketing by 10 percent
- Reduced visitors bouncing from website by 5 percent
- Increased customer satisfaction by 10 percent by training call center
7. Equipment Maintenance Planning OKRs
Objective: Reduce machine downtime by 10 percent over the next quarter
Key Results
- Increased maintenance frequency by 5 percent
- Reduced maintenance scheduling by 10 percent
- Increased preventive maintenance with five percent more upkeep of assets
8. Customer Service Management OKRs
Objective: Reduce customer attrition or churn by three percent over the next quarter
Key Results
- Added incentives for customer loyalty
- Increased proactive customer support for a 5 percent boost in retention
- Added 10 percent more personnel to gather customer feedback
9. Operational Efficiency OKRs
Objective: Increase operational efficiency ratio by 3 percent year over year
Key Results
- Increased resource utilization by 5 percent
- Streamlined inventory management
- Added more effective maintenance to workstations
10. Event Planning OKRs
Objective: Increase webinar registration by 10 percent concerning the last webinar
Key Results
- Added email reminders before event
- Asked for feedback from registered attendees
- A/B tested email invitations
As you can see it’s a simple process that sets clear, yet challenging, objectives. However, there’s more to executing OKRs than just writing them down.
OKR Template
This free OKR template for Excel helps organizations track the objectives and key results of each of their functional departments, as well as other important information about them such as their priority level, due dates, status and their related costs.
How to Write OKRs
When it comes to OKRs, success is marked by reaching beyond your perceived limits, so the first thing you want to do is set up objectives that make teams push themselves. They might not reach the goal line, but if they get close, then you’re already ahead of the game.
After you set your objectives, you’ll want to define a few measurable key results that are quantifiable, achievable and, while difficult, can be graded. They can be based on growth, performance, revenue or engagement. While it’s more likely that these measurements will have a range, you can also go binary with a yea or nay result.
Check Progress
Once those objectives and key results have been established, you’ll want to have regular check-ins that are made public, so everyone is aware of when they are being held and can be prepared when it’s time to report. This goes for everyone in the organization from the top down. The success of OKRs is dependent on the fact that all company members are clear about what their goals are, as well as their teammates’ goals.
It’s not all work, though. Now that you have a structure in place to set goals and track performance, you can’t neglect rewarding success. That means recognizing and celebrating when goals are met, or when significant progress is achieved. It acknowledges the hard work your team has put in, and it helps to build closer-knit teams that will work even more productively moving forward.
Benefits of OKRs
The simplicity of the process is great, but the benefits are even better. The method is designed to keep the vision, goals and objectives of the company, team or individual in the forefront. People know what’s expected of them and how their work fits in with the larger tasks of the team, department or company.
The great thing about OKRs is that they don’t take much time to set up, and they’re easy to use. Everyone understands them and meeting to discuss progress is clear and only needed every now and then. While individuals will have a more intimate relationship with their progress, and they’re responsible for their tasks, the time-wasting of too many meetings is avoided.
Managers love OKRs. It gets people motivated and aligns organizations to work collectively towards common goals and objectives. It keeps people focused on the important goals, while not ignoring smaller tasks. Overall, OKRs provide a great boost to an organization’s focus and productivity.
OKR Best Practices
Committing yourself to goals is the surest way to achieve them. Using OKR as a means to achieve those goals gives you structure. But certain things must be adhered to when setting up your OKRs to better your odds at success.
- Make Objectives Clear: There’s no way to achieve what isn’t clearly defined. Boil the objective down to make it easier to understand and easier to reach.
- Make Objectives Inspiring: While you want to make objectives plain and simple to understand, you also need them to inspire. It helps to set those goalposts high, often referred to as a “moonshot OKR.” This inspires teams to think outside the box for less traditional methods to achieve the high standard you set.
- Make Objectives Public: Everyone’s objectives throughout the organization are known by the company. This helps each team member see how their individual goals align with the other company goals.
- Always Measure Progress: Of course, you must reach your objective, but to achieve that you must track your progress. Set up a metric to measure progress and make sure your team is doing the same.
- Failure Happens: Within the OKR framework, it’s important to constructively deal with failure. There is usually a lesson embedded in every failed project that holds the key to future success.
OKR vs. KPI: What’s the Difference Between OKRs and KPIs?
Finally, you might be wondering, well what’s the difference between KPIs and OKRs? Key Performance Indicators (KPIs) and Objectives and Key Results (OKRs) are similar metrics used in management. The main difference is that KPIs are just metrics to measure performance, while OKRs are part of a goal-setting method that can be used by organizations to build action plans and track performance.
History of the OKR Methodology
Early Google investor, John Doerr, attended a course within Intel taught by Andy Grove in 1975. It was here that he was introduced to the theory of OKR, which Grove said was a simple but effective management tool.
“The key result has to be measurable,” Grove said. “But at the end, you can look, and without any arguments: Did I do that or did I not do it? Yes? No? Simple. No judgments in it.”
In Doerr’s book, Measure What Matters: How Google, Bono and the Gates Foundation Rock the World with OKRs, CEO of Alphabet and Google co-founder Larry Page wrote in his forward, “OKRs have helped lead us to 10x growth, many times over. They’ve helped make our crazy bold mission of ‘organizing the world’s information’ perhaps even achievable. They’ve kept me and the rest of the company on time and on track when it mattered most.”
Famous Companies That Use OKRs
Google and Alphabet aren’t the only major companies that have adopted OKRs in their organization. Successful companies like Netflix, Amazon, Dell, Dropbox, Facebook, Samsung and Twitter have all started using Objectives and Key Results to propel their companies to the forefront of their perspective industries. They rely on OKRs to motivate and inspire their teams to reach goals they never thought possible.
More Free Templates to Track Project and Operational OKRs
There are more ways to track project and operational OKRs with project management templates. We have over 100 free project management templates for Excel and Word. Below are just a few of the ones that can be used for OKRs.
Dashboard Template
Use this free dashboard template for Excel to track tasks, workload, costs and more. Data is displayed in easy-to-read graphs and charts that allow users to see at a glance if they are meeting their goals.
Balanced Scorecard Template
This free balanced scorecard template looks at strategic measures beyond the traditional finances. It does this by looking at strategy across four perspectives: financial, customer, business process and learning and growth.
Progress Report Template
A progress report documents how far work has progressed compared to where the plan expected it to be. This free progress report template for Word will help ensure that the project is moving forward as planned.
Project Manager Offers Advanced Project OKR Tools
Templates aren’t the best way to measure and track OKRs. They’re static documents that have to be manually imputed. That’s going to pull users away from their work and the data it collects is always going to be a step behind where the work is. A better tool for using OKRs is project management software. ProjectManager is award-winning project and portfolio management software that can make schedules, monitor progress and generate reports all in real time.
Make Timelines and Schedule Tasks with Gantt Charts
Use robust Gantt charts to schedule work on a timeline that organizes tasks, adds milestones and can be shared with the project team. More than that, our Gantt charts can link all four types of task dependencies to avoid costly delays, filter for the critical path to identify essential tasks and set a baseline to track planned against actual effort in real time.
Monitor Progress and Costs in Real-Time Data Dashboards
Once a baseline is set on the Gantt chart, live data is automatically collected and displayed on real-time project and portfolio dashboards. View time, cost and more on easy-to-read graphs and charts without the time-consuming and complicated setup required on lightweight software alternatives.
Make Project Reports in Minutes
For a deeper understanding of the data, go to the customizable reports. There are status and portfolio reports as well as reports on variance, workload, timesheets and more. All reports can be filtered to show details that managers need or more general information that can be shared with stakeholders to keep them updated.
When you’re tracking goals and giving everyone access to those common objectives, it helps to have a tool that will facilitate the process. ProjectManager is an online project management software that is a great platform for tracking progress and collaborating on projects. collaboration. See how it can help your organization use the OKR framework more effectively by taking this free 30-day trial.
