The OKR framework, when adopted correctly, can turn a company’s mission into a tactical plan of action. Whether it’s addressing new competitive business risks, launching a new feature or product, or developing a more agile form of strategic execution, OKRs are how businesses are developing a collective mindset that keeps their teams engaged, accountable, and laser focused. Simply put, the OKR method of goal setting was developed to give strategic focus on the things that matter most--and creating a path to measure and achieve them.
Unlike other goal setting methodologies where goals are merely set and teams are left struggling to achieve them, the OKR framework creates a system that first sets goals, then defines the key results that are needed to measure the success of those goals. Goals are set across three levels, first at the top, where annual, long-term objectives are defined for the company, then at the team and management level, where goals are broken down into quarterly objectives, then finally at the individual level, where quarterly goals are managed on a week by week check-in cadence.
As seen above, OKRs address both short and long term tactical goals, across every level of the organization. Goals start at the top, cascade down, across every level of the organization to drive individual and team alignment, and ensure that all employees are working towards the same shared objectives.
The very nature of the framework demands company-wide transparency to enable everyone to see what everyone else is doing. By defining goals in this way, the OKR framework fosters both an agile and flexible process to help businesses execute on aggressive growth plans. It eliminates distractions, drives direction and focus, and creates strong alignment between teams and peers.
In short, the OKR framework is more than another approach to goal setting. It’s a cultural adoption that elevates how organizations think, work and execute.
OKRs drive short- and long-term direction for every team, and individual. They empower employees by demonstrating how each person's contribution influences the company broader mission and goals.
With prescriptive focus, OKRs provides every individual with concise direction on “where” and “how” time should be spent. Expectations are set on a quarterly, and/or monthly basis, giving teams and individuals the autonomy to do what needs to be done, while at the same time, empowering them to understand what is expected of them.
OKRs take a unique approach to goal setting, one that includes a mix of top-down and bottoms-up collaboration. This bidirectional approach requires goals to be set at the top, then cascaded down, across teams. From there, team leads and individuals are given context on how their goals should be developed. By understanding first the strategic direction of the executive leadership team, employees are better equipped to understand how their goals should be written, and aligned to the broader goals.
Since OKRs require goals to be developed from the top first, they ingrain executive support into the process, therefore, driving greater adoption and participation company-wide.
OKRs address both short-term tactical plans and long-term strategic goals at the same time. OKR planning and check-in cadences run on a series of scheduled cadences known as rhythms.
These rhythms address long-term strategic goals on an annual basis, while short-term tactical plans are addressed through quarterly planning. Finally, operational initiatives are addressed on a weekly schedule, to ensure all teams and contributors stay in alignment, and track goal progress.
By managing short-term tactical plans on a weekly check-in cadence, teams are able to execute without distraction, and instead focus on the top priorities that will make the strongest impact that week. If/when business plans change, it’s easy to pivot and refocus team efforts in a new direction. This type of agility is what gave Intel the advantage it needed to win the microprocessing war against Motorola.
One of the many superpowers OKRs use, is the notion of stretch or moonshot goals. The idea is to set harder, more challenging goals to push teams to achieve more. Goals are set up on a scoring scale of 1-10, or 1-100, and scored in increments of 1 or 10.
When using the OKR framework, the goal is not to achieve 100% of any goal, but instead set a lofty or ambitious goal, and don’t be upset if you achieve 70-80% of that goal.
To learn more on why OKRs are so compelling check out 8 Ways OKRs Help Businesses Grow and Thrive