The foundation of the OKR (Objectives and Key Results) methodology is the idea of setting corporate objectives and outlining the plans of action necessary to attain them. This approach necessitates that everyone in the organisation understands the company’s goals and the steps it will take to reach them.
Is it possible for you to determine the company’s priorities? It indicates that management has to be improved if you are unable to name at least three. Ultimately, how can one devote themselves to something that lacks direction or purpose?
Such questions can lead to a lack of productivity , commitment, and team engagement, causing yet another problem and obstacles to achieving goals.
Do you understand how the OKR methodology can impact your company? Read the article we prepared and learn everything you need to know about this subject!
What is OKR?
The acronym for Objectives and Key Results is OKR. Therefore, any organisation can manage its goals and specify which techniques will be employed to reach them within a specific timeframe by using the OKR methodology.
The ( O ) in the acronym represents the objectives, which must be qualitative. In other words, those that cannot necessarily be counted in numbers. The ( KR ) are the key results, which must be quantitative and measurable, known by many as a goal.
So, for example: to make my blog a reference in technology content (objective) I need to get 3 posts per month in first place in organic search on Google (key results).
In short, the objective tells you where to go and refers to that inspiring dream of the company. Meanwhile, the key result allows you to identify whether you have reached that goal or not.
Basically, the structure is as follows: The company has an objective and needs key results from each sector to achieve them. Therefore, each sector also has its own objective and key results to deliver. And together, each area, by setting its goals according to what the company needs and delivering its results, achieves the company’s overall objective.
Examples of objectives:
– Become a reference in the children’s fashion market
– Have the best people management platform
– Be recognized as the best company to work for in the country
Examples of key results:
– Grow from 2,000 to 4,000 visitors to the blog
– Acquire 500 new customers in the semester
– Have an NPS above 80
What results does the OKR methodology generate?
Through OKRs it is possible to identify whether the team and results are progressing according to plan. After all, this contributes to better decision-making regarding business processes, products and strategies. Given this, it is clear that OKR helps to:
Focus – It is obvious that most companies want to reach the highest levels and titles of success. But, like everything in life, you need to have priorities. Working with OKR means having a concentrated focus on an objective and ensuring that it will be achieved and not procrastinated, or deprioritized.
Engagement – By defining OKR, employees feel motivated and aligned with the organization’s purpose. This way, they can manage themselves without getting lost, because they know exactly what they need to achieve, in addition to being encouraged to think and create ideas and solutions that help deliver results.
Alignment – Internal communication is enhanced because, when using OKR, noise is minimized as there is transparency and everyone knows and understands the objectives and the impact of their work on final deliveries.
What is the difference between OKR and KPI?
KPIs (Key Performance Indicator) are also key indicators of quantitative values that help measure process performance, but the main objective of the KPI is to minimize errors, find problems and promote solutions.
Therefore, OKR and KPI complement each other. After all, if your company adopts a goal system, whether OKR or not, you need, in some way, to be able to measure the results that show performance.
We can say that the OKR methodology is focused on developing strategy and goals, and KPIs are there precisely to monitor and ensure that everything is going as planned.
Most common mistakes when using OKR
Some common mistakes can compromise the delivery of results and put the strategy in question. So check out the three main mistakes when it comes to OKR.
1. Not tracking OKRs
A goal that is not monitored easily falls into oblivion. Therefore, the ideal is to have a leader just to monitor the OKR implementation project in the company. Monitoring will ensure successful delivery of results.
2. Lack of communication and alignment
Normally, the work of one area always influences the routine of the other departments. Therefore, it is important that everyone shares information and the status of their activities from the moment it is understood that a delayed or even poorly done task can cause a collective impact. Ideally, areas should not think individually but rather as a group.
3. Not implementing OKRs in phases
Working with OKR is telling an entire organization which path it needs to follow. Therefore, everyone must understand and embrace this new company methodology. To do this, it is necessary to go gradually, teaching the concepts, showing how this applies to the company’s culture and then implementing it.
How to apply the OKR methodology in my company?
Now that you understand the concept and how it works, it’s time to put OKRs into practice and implement them!
First of all, it is important to create objectives with leaders and write the key results for each sector in a spreadsheet or specialized platforms that can be accessed by the entire company.
Then, think about these three questions together and try to find the answers:
1- Where do we want to get to?
2- How will we achieve this?
3- What does it prove that we achieved?
Faced with these questions, ideas for actions emerge. When you get these answers, it means you have already established the company’s OKRs!
With this in mind, the next step is to apply and demonstrate to employees in practice everything that was planned. At this stage, prepare training sessions, explain the concepts and clarify how the company came to the conclusion that these would be the ideal OKRs for the business.
It is also important to define OKRs separately for each area so that everyone can participate, feel engaged and understand their importance. It is essential that they can somehow transparently monitor the progress of the project.
