OKR: The management method that will boost your team's motivation

OKR: Objectives and Key Results

What is an OKR?

The OKR (Objectives and Key Results) methodology is a business management technique that involves setting objectives coupled with measuring key results. Among the advantages of this technique are improved focus, enhanced transparency, and better team alignment with strategy. This is achieved through organizational efforts centered around employees, the tasks they perform, and shared objectives.  

Objectives (O for objectives) define where we are going and provide motivation. They must be qualitative, inspiring, challenging to achieve, and necessarily time-bound. They can be accomplished by a team or individually.  

Here's an example: Double quarterly revenue.  

Key Results (KR for Key Results) determine how we will get there, outlining the means by which we will achieve our set objectives. They allow us to quantify and gauge these objectives with a starting value and a target value that measures progress toward them. The objective above can be measured by several key results:  

• X thousand in revenue via Google Ads  

• Sign 4 upsells with our strategic clients  

• Double new client acquisition through prospecting  

Initiatives are descriptions of the tasks to be done to influence a key result. If the objective is where we are going and key results indicate how we are getting there, an initiative describes what we could do to reach that destination (by car, boat, or camel).  

Here’s an example of an initiative related to the key result "X thousand in revenue via Google Ads": Implement a Google Ads strategy and create a dedicated landing page for each keyword. As for "signing 4 upsells with our strategic clients": Offer a free strategic recommendations meeting to existing clients with their Customer Success Manager.  

And for "doubling new client acquisition through prospecting": Implement a high-value digital prospecting strategy.  

OKRs should be defined at different levels. This means for the company, for each team, and individually. They then "cascade" down, allowing each team, manager, and employee to create their own OKRs:  

• Company OKR: This is the company's vision and/or reason for being.  

• Team OKR: These are a team's priorities, and not a compilation of individual OKRs.  

• Individual OKR: These are the missions on which employees should focus.  

The Origins of This Method  

The OKR method was created in the 1950s by Peter Drucker, under the name "Management by Objectives." This technique was later adopted and introduced in the 1970s by Andy Grove, then CEO of Intel.  

He adopted this method to implement a strategic change in his company: to transition from being a memory supplier to a microprocessor supplier.

In this highly competitive market, Intel managed to flatten the competition thanks to clearly defined objectives and regularly tracked results, which allowed teams to quickly correct their trajectories throughout the process.

Subsequently, in 1975, John Doerr, one of Google's main investors, impressed by the conference given by Andrew Grove on the OKR method, presented it to Larry Page and Sergey Brin, who introduced this process at Google. They still attribute a large part of their success to this method today.  

From that moment on, OKRs spread like wildfire in companies. Since 2012, this interest has steadily increased, and today, in 2020, companies such as Apple, Microsoft, and Amazon, to use Marc Andreessen's words, "have taken control of large parts of the economy" and this is thanks to the use of OKRs as an objective-setting system.  

The Benefits of OKRs  

This method has a real impact on businesses. Employees using this method prove to be much more productive in their work, thereby leading to increased performance and profits at all levels.  

• €3.9M - surplus revenue per year achieved by a transparent and committed mid-sized company  

• 72% - of Gen Y employees say they are engaged when their manager helps them set objectives  

Source: https://www.2018/Infographie-OKR.png  

But the greatest impact for businesses comes from the cultural changes that occur once the method is implemented. Defining objectives allows for the development of three essential points when using this method: focus, transparency, and alignment. When combined, these three factors lead to stronger employee engagement.  

Alignment

With a better understanding of what their efforts aim to achieve, employees feel more valued. Everyone has the means to see how individual objectives are progressing, and overall, if the company is on the right track. It's a simple and effective way to ensure that your objectives support the company's overall strategy.  

Transparency

OKRs are and must be transparent. This is necessary so that the ENTIRE company can see everyone's objectives, thereby enabling mutual accountability. Furthermore, it allows employees to gauge how their work influences the company's main objective and encourages collaboration among them.  

Focus

There are so many things one can do in a year or over a quarter. OKRs force you to identify 3 or 4 objectives and narrow down priorities by focusing on those that are most important. This allows the company to achieve a much higher engagement rate, as setting too many objectives does not provide clear direction.  

OKR: How to Use Them?

OKRs require preparation

Before you start implementing your Objectives and Key Results, it's important to have a clear understanding of what you want to achieve as objectives and key results.

To successfully implement this method, the definition and management of OKRs must have an owner within the company, named "Ambassador." Their role is to ensure that everyone involved in the OKR process is trained, engaged, and receives continuous help and advice.

These objectives provide us with a framework. They must inspire everyone who works on them, and they must adhere to them. Each stakeholder must agree that these are the right things to focus on.

Also, during this consultation, ensure the orientation of your OKRs. With the right operational context, you know where to focus your efforts, and in this way, you ensure that your OKRs perfectly support your company's ambitions.  

Here are some tips to help you:  

• Adjust your OKRs to your mission and/or vision. They must move the company forward. They should bring you closer to your mission/vision. If this link is visible, it's easy for everyone to have an overview.  

• When defining objectives at a team or individual level, make sure to check existing objectives to see if they all combine.  

• When selecting your OKRs, it's easy to get too enthusiastic. Objectives should be ambitious but also achievable within the set deadlines.  

• Look at your KPIs. These tell you the performance of key areas of your business. Do they reveal any problems that need to be solved? If so, what can you do to influence your KPIs?  

• Always check your OKRs when the deadline approaches. This will tell you if you need to redefine them for the next period.  

Defining the Right Cadence

For the vast majority of companies, OKRs are defined following an annual and quarterly cadence. It is important to understand that different objectives lead to different rhythms. We are talking here about tactical objectives and strategic objectives. OKRs therefore have a triple cadence: tactical, strategic, and we also add follow-up.  

Strategic Cadence

A strategic cadence corresponds to very ambitious and longer-term OKRs, defined by the company. They are generally annual. This simplifies taking organizational strategy into account and transforming it into company objectives.  

Tactical Cadence

A tactical cadence corresponds to shorter-term OKRs, managed by the teams. They are quarterly. This allows for shorter review cycles and enables teams to easily change direction if tactics are not supporting strategic OKRs.  

Follow-up Cadence

A follow-up cadence allows for regular checks to track ongoing results, weekly. The metrics for the different key results are established at the beginning of the quarter and will be used for follow-up.

A bit strict, you might say?  

Not at all! You can also customize your cadences according to your needs. For example, Spotify developed its version, called "Spotify Rhythm," and uses a 6-month strategic cadence and a 6-week tactical cadence.  

The Characteristics of Objectives and Key Results

Characteristics of an Objective

• Time-Bound Each objective must be time-bound and therefore needs a "horizon" defined. If OKRs are defined on a quarterly cadence, the deadline is generally the end of a quarter. This encourages focus and allows for a cyclical rhythm. Thus, one can quickly identify what is working and what is not, and change course if team objectives are not supporting company OKRs.  

• Tracked Objectives must be tracked weekly, and teams should hold regular weekly meetings to monitor progress. Employees, meanwhile, should plan "feedback loops" to exchange and comment on each other's work. This will encourage collaboration among employees by helping each other fulfill their commitments by sharing necessary resources and expertise.  

• Inspiring and Understandable Some people in your company are motivated by numbers. Others need a more inspiring objective. Language will be your solution! A simple way to make your objectives more inspiring is to include adverbs and adjectives such as successful, great, best, etc. You should also avoid jargon specific to certain positions or teams and keep descriptions as short as possible.  

Characteristics of Key Results

• Ambitious Key results that don't push us out of our comfort zone are probably not ambitious enough. Nevertheless, they should not discourage but rather encourage teams to rethink their way of working, ask the right questions, and discuss "sensitive" topics. It's about surpassing oneself!  

• Specific A team's key results must be targeted and clearly defined. They must be specific regarding quantification and the timeframe for achieving them, in order to remove any imprecision, whether concerning the deadline or the goal to be reached.  

• Influencable Key results must always be influencable. Writing 10 blog articles is a bad key result; it's something one does. Getting 1000 views on a blog article one has written is a good key result, because it's something one does not control but can influence.  

Characteristics of an Initiative

• Specific An initiative must always be specific. Its scope must be clearly defined, and the initiative owner (responsible for achieving the initiative) must know what to do. It cannot be approximate like an objective. An initiative must therefore contain precise and clear verbs (e.g., establish, write, etc.).  

• Under Control It is imperative to have full control over initiatives in order to carry them out successfully. This means there should be no dependence on anything or anyone. It also means that one can be held accountable for not having properly executed these initiatives.  

OKR: A Concrete Example

To better illustrate the use of OKRs, we drew inspiration from one of our future projects (a little teaser, but not too much). We started with a strategic OKR (to be carried out as a team) with a 6-month deadline (we're fans of Spotify, for those of you paying attention).

This objective is an important element of our project, which could be described as a company OKR, as it will be central to our concerns for the coming year. And it concerns our dear freelancers, as we were a little disappointed not to be able to support them in their needs despite their (numerous) requests.

Without further ado or transition, here are our Objectives and Key Results.  

We chose the objective of becoming the go-to blog for launching a freelance business. As a reminder, an objective must be ambitious; it must motivate and be inspiring, so let loose! For this objective, we defined three key results (it's good practice to determine three to four key results):  

• Secure 30,000 monthly freelance visitors through SEO (in three months)  

• 50% of people who fill out a form on the site are freelancers (in five months)  

• Obtain 3 press mentions about the blog (in six months)  

Again, remember that key results are the tools that will allow us to achieve our objective. They must be specific, both in terms of timeframe and measurements. It's something you don't control but can influence.  

The third and final step in implementing an OKR: initiatives. When we talk about initiatives, we are referring to tasks (to be carried out alone or with others) or hypotheses that allow us to influence a key result. We have therefore chosen one initiative for each of our key results:  

• Create a semantic cluster dedicated to freelancers on our blog (to secure 30,000 monthly freelance visitors)  

• Produce high-value downloadable content for the site (for 50% of people who fill out a form on the site to be freelancers)  

• Create and send a press release (to obtain 3 press mentions about the blog)  

Bonus: 6 Pitfalls to Avoid

#1 Too often considered an administrative tool for organizing tasks within the company, this is a tendency that complicates things and makes companies less agile.  

#2 Do not link OKRs to employee performance evaluations. Employee performance is also measured by behavior, cooperation, initiative, etc. We must not and cannot measure all of this with this method.  

#3 Don't forget to communicate your objectives: everyone should know the company's objectives at all times, clearly and understandably. Set up a tool so that your teams can visualize and track their OKRs and those of others.  

#4 The "top-down" method should be avoided at all costs for defining your OKRs: let your teams define their own objectives, and negotiate with them to align them with the organization's strategic objectives if necessary.  

#5 Make a clear distinction between OKRs and KPIs: for KPIs, these are generally achievable (SMART) objectives and reflect the results of a process already in motion. They are often kept private. Objectives and key results are much more ambitious and encompass a broader dimension. They are intended to be transparent.  

#6 Neglecting to facilitate your OKRs: Unlike SMART objectives, OKRs are not simply there to "measure"; there is a real logic of managerial facilitation. Not considering how to facilitate OKRs is depriving yourself of their ability to transcend your teams. A good complement would be to think deeply about how you will facilitate your teams using OKRs and Gamification (for this, we recommend this little gem that is worth a look: The Gamification Guide).