Every business starts out with big ambitions. Whether it's to innovate the next breakthrough technology or design a new way to deliver customers high-end services, all organizations have sky-high aspirations for making an influence and earning success. However, for each overall objective teams work toward, there are a number of key results that must be achieved along the way.
An example: The U.S.'s objective in winning the Cold War-era space race was to put a man on the moon. The key results that were needed to make that possible included building a lunar module weighing under 400,000 pounds and having it ready by December 1965.
There's even a methodology that addresses this relationship between desired outcomes and the technical details: It's called OKR, or objectives and key results. Used by some of the largest companies of today including Google, Microsoft and LinkedIn, OKRs give companies a way to tie together actionable steps and the ultimate goal. Here's what you need to know.
Why use OKRs?
Companies use OKRs because they're perfect for aggressive goal setting. You can't have objectives without key results, and vice versa. What OKRs allow companies to do is not only communicate their mission and vision, but also establish a defined pathway to success.
Think of it this way: There's no place for hedging your bets when you plan your organization's next big move, but with a big goal and no concrete steps to get there, work can become unfocused and never find a way to reach that vague, distant objective. Conversely, key results without an objective can amount to a lot of work being done, but without much reason as to why. Not being aware of the end goal can impact employee morale and motivation.
OKRs help facilitate progress and success because, much like an outline is used to structure a paper, OKRs are used to clearly articulate ambitious goals and the practical steps needed to get there. Taking this comprehensive approach allows organizations to focus on both the end game as well as the now.
How to use OKRs
OKRs are an attractive methodology to take up, but in order to make the most of them, adopters should follow a few guidelines about their use. For example, OKRs should be:
- Set on varying time frames: It's beneficial to have both quarterly and annual OKRs, even five-year OKRs for down the road. Having a plan in place is a lot easier than having to fly by the seat of your pants.
- Communicated to everyone: OKRs are so valuable because they can get everyone working on the same page. Without a clear sense of a mission and vision, nor measurable steps, companies find it tough to generate buy-in or progress.
- Challenging and forward-thinking: Your goal might not be to land someone on the moon, but OKRs are best used when directed at ambitious, disruptive or industry-changing plans. Having a structure to support aggressive goals is key to ultimate success.
Where does CPM fit in?
Much like objectives need key results, OKRs in general need continuous performance management (CPM). Indeed, they're a perfect fit. CPM emphasizes ongoing feedback and check-ins that employees and managers alike can use to communicate and collaborate. OKRs often serve as the framework for large-scale projects, and using CPM to monitor progress and potential bottlenecks is an highly effective strategy for making sure everything works in the end.
Interested in more about OKRs and CPM? Contact BetterWorks today for more information about our product suite and how we can help you integrate OKRs and CPM into your organization's DNA.