“As soon as possible”, said Rick Klau, a partner at Google Ventures, in response to a question about when a management team should adopt OKRs.
I mean, do you want to delay organising and executing your goals? Do you want to delay good results? When do you need better focus, alignment and accelerated growth, sooner or later?
Despite having been made some time ago, this question is very relevant if we think about the dynamism that the market offers today. The OKRs framework (Objectives and Key Results), emerges as an immediate reaction to the need for performance cycles that are much more accelerated and intense in companies that need to adapt to remain competitive by harnessing constant changes throughout the year.
Start lightly and keep it simple
Being simple to use and focused on results, OKRs are an appealing solution for companies looking to quickly enhance their performance on the market. The OKRs framework makes it possible to have a flexible strategic management, that adapts to the new reality of companies and can be adopted by any type of business, from different segments and sizes.
Google, one of the major promoters of the OKRs framework, believes that OKRs are the secret of their success. You can align, communicate and provide business insights to everyone in your company. The definition, monitoring, and evaluation of the objectives and key results provide hard data that can be used to benefit your strategic decisions.
In addition, OKRs make sure that the company’s focus is always on business priorities. Having the strategies aligned with the entire company is essential to ensure a high-performance culture in which all employees understand which path should follow their OKRs.
“Where do we want to go and how do we know that actually get there?” This was the question asked by Andy Grove, chairman of Intel in the 1970s and creator of OKR methodology. With OKRs, you can answer this question in a clear and focused way, bringing results for the entire company.
If you’re setting OKRs for the first time, my strong recommendation is that you keep it simple:
Start with only one: one objective and 3 key results for the company and only one per supporting team.
Why? It’s faster, it’s memorable, so you’ll learn it by heart and it provides sharp focus on the essential activities to accomplish your goals.
If you find yourself in front of a list of 5 objectives, determine which OKR is the least important (you can collaborate with others to gather their input, you don’t have to make this decision alone) and cut the least important OKR for this quarter; you can always revisit that it at a later point – even next the quarter if it’s important enough to pursue it then. Repeat and cut through OKRs until you have one bold, fat and a little scary OKR.
The first cycle with OKRs will be a learning one
As stated earlier, OKRs allow companies to work with cycles of rapid and dynamic performance management, adapting to the current market trends. The OKRs work, in general, each quarter; there is the possibility of shorter cycles depending on the degree of business maturity in the methodology and your natural business cycles. For companies that want to implement and have no previous experience with this framework, we suggest starting with simple monthly cycles to set the cadence and OKR processes.
Your company will not probably nail the process the first time you will implement OKRs. There is usually a period of trial and error, so don’t feel surprised or discouraged if it takes some time for your company to really tune into OKRs or if it doesn’t work the way you expected.
Final months of the year are a good period to reflect the goods and bads of the past year, to decide on the direction for the next period, and to start the year with OKRs cadence already set. We found from experience with our customers that it takes at least one quarter to succeed with the methodology. When we go for big challenges, setbacks and mistakes are natural consequences.
OKRs aren’t just about hitting targets, but about continuous learning what you are truly able to do. They are there to push you to improve. Let’s say you didn’t achieve the 20% growth in recurring revenues, but you got 15%. Would you be devastated? It’s a great metric and you’ve learned a lot about what it’s working and what it’s not.
A significant part of the value of OKRs comes from the discussion on what it’s important, how it will be measured and what it implies for teams who are used to work in a reactive manner, with no clearly defined business goals. You want your OKRs to be ambitious enough to push you beyond your limits; this brings the opportunity of crucial conversations about what’s truly needed to beat expectations.
If you use OKRs in at least a quarterly cycle you can improve your goals setting as you learn how the team performs. Don’t be afraid to try big things, and make sure you reward and encourage people for going bigger than their comfort zone.
How about putting OKRs to a test in your company and enjoy the results in the first quarter of 2017?