Objectives and Key Results (OKRs for short) are changing how companies define and communicate success. Why not have a read through our free beginners guide to OKRs to get more information on how you can align and grow your company.
I often remember from my days of leading divisions in large business, being asked: “What difference do I really make?”
At first, it was asked with a sense of despair and disillusionment. The business hadn’t been great at showing those who were working hard to deliver services the impact they were actually having on clients. I learned to get good at helping people to feel like their contributions mattered and that they were valued. I quickly realised that this was the work that never ended.
Now if you are in a smaller business, the distance between effort and outcome might be a lot shorter and a lot clearer. However, you still need to make sure that your people understand the link. As a result, they will then know what matters most and where to focus their attention.
This is where Objectives & Key Results (OKRs) can help
One of the fundamental principles of OKRs is alignment. All individual OKRs (and departmental ones if you have them) should support a business level OKR (or goal, vital few, whatever works for you) which usually has a longer span of 12 months.
This “Parent” and “Child” relationship means that when progress is made at an individual level, it should roll up and reflect progress towards the business level.
This has a number of benefits. First, it helps those on the front line to see how their contributions are moving the business towards its goals. Good managers and leaders will use this to boost engagement, motivation and morale.
Second, it gives directors, shareholders and any other key stakeholders a real-time view of the non-financial business performance. This is transformational for many businesses. These are the activities which have often proved elusive to track and report. Now, they have the ability to see the impact of the latest development sprint on the overall product launch OKR. This is invaluable to those needing to demonstrate progress to an investor.
The need to roll up results is a major reason why businesses choose to use a system to manage their OKRs. You’d need a PhD in macros to make it work in Excel! Some systems do it better than others, but you can read about that in my blog that looks at some of the best options out there.
Fundamentally, rolling up is about capturing progress data and leveraging that to improve communication, motivation and engagement. It’s amazing the value you can get from data sometimes.
OKRs represent a performance management methodology which connects the work of individual employees to your company’s overall strategy. Looking to learn more? Read our blog ‘What are OKRS and how can they help my business?’