Apply the experience of Google and Intel to your company.
“Is my business moving in the right direction? Am I setting the right goals?” – These are the questions entrepreneurs ask at different stages of the development of their own business. One of the tools that can help make a company’s progress systematic can be OKR (Objectives and Key Results) – a system of goal setting developed at Intel.
Its key difference from others is flexibility. Many companies plan their work a year in advance, and it usually ends up with hopeless obsolescence of the plan. OKR follows an agile ideology in which goals and results are reviewed regularly. Usually, this happens once a quarter, but many companies adapt the system to themselves and additionally implement weekly and annual OKR.
The system owes its popularity to former Intel employee and venture capitalist John Doerr. Today this method is used in many well-known IT companies, including Google, LinkedIn, Twitter, and others.
To get started with OKR, you need to:
- Start preparing employees 3-4 months before the transition to the new scheduling system so it goes easier. Hold meetings, webinars, recommend appropriate literature and try to implement OKR at the corporate culture level.
- Formulate goals.
- Define results.
- Follow up and adjust the goals.
How to formulate goals
OKR goals are a memorable and concise description of what you want to achieve. Their main purpose is to challenge the team or the company.
Another distinguishing feature of the OKR system is who shapes goals and results. Unlike KPIs, which tend to be set by management, OKRs can also be shaped by the performers themselves. This encourages more initiative and involvement in the company among the rank-and-file employees.
In addition, goals must meet some important criteria.
Here it is important to maintain a balance: the goal should be achievable, but not too easy. Imagine what you could do at your best. That would be a great goal.
Finiteness and clarity
It’s simple: there must be a defined endpoint to be reached. Try to make the goal a unit in its own right, a slogan that needs no explanation. You must understand how you will arrive at your goal and what tools you will use along the way. For example, the paystub portal is the easiest solution for businesses that will save you time and nerves.
Ambiguous wording can lead to conflicts with the goals of other employees. For example, team A wants to update the site’s UX: remove outdated elements, change colors and buttons. Team B wants to optimize the site and improve load speed. Both used the vague phrase “Improve the site,” even though they mean completely different things. To avoid inconsistency, team A should have set the goal as “Revamp the site’s UX,” and team B should have set the goal as “Speed up the site’s load.
There shouldn’t be many goals. If it’s a small startup of five people, one will be enough. For example, “Create an AI calculator app and make it to the top of Google Play bestsellers” is not a good goal. A better choice would be to focus on launching the product (“Create an AI calculator app”) and then focus on promoting it in the following quarters.
And even in the case of a large company with a complex structure, try not to create an additional goal unnecessarily. If there are too many of them, it will take a lot of time to synchronize between departments and figure out who does what.
How to formulate results
Once you’ve decided on your goals, you can start with the results. If goals motivate and point in the general direction of work, then results should be as specific and measurable as possible. These are working tools and metrics.
With them, it is also important to observe moderation: each goal can have up to five results. Otherwise, you will be wasting your efforts. For example, you have an online store and you want to improve your email newsletter with offers to users. You set an ambitious goal “To make the most profitable newsletter on the Internet”. In this case, the results will be as follows:
- Increase the open rate of emails up to 70%.
- Increase sales from each newsletter.
- Raise the number of purchases in each newsletter to 50.
Key results also have some important criteria to consider.
No figures – no result! If abstract constructs are still possible in formulating goals, they are not allowed in the formation of results.
The result must first of all be achievable. If you can’t say with certainty that at one moment you have achieved what you want, then there is no point in exhibiting such a result.
One result, one metric. If you try to put everything in the wording, it won’t do any good.