Have you ever wondered what Google’s secret formula for success is? What is it that made them, among all other search engines, achieve the levels of greatness that they continue to witness today, and will undoubtedly see well into the future?
If you’re like us, you probably feel that these types of questions demand answers. What some people still don’t know is that there is a clear, definite answer to how they did it, and it’s called OKRs.
OKR is an acronym for Objectives and Key Results. It’s a strategic goal setting approach that Google has been using since 1999, and it’s also what allowed them to take their company to the size of 40 employees to 40,000.
How Google Discovered OKRs
Originally, OKRs were introduced to Google by John Doerr, formerly of Intel, in 1999. He demonstrated the approach and outlined their potential in a slideshow (which is summed up quite well by Google executive Rick Klau in this video – check out our transcript here).
Despite the fact that it’s worked so well for Google for more than a decade and a half, some companies are only just catching on. In other words, there’s still much to be done in implementing the concepts of goal science into growing organizations.
OKRs: A Quick Overview
We created a variety of OKR resources for you to learn more about Objectives and Key Results so if you’re looking for more detailed information well as OKR examples then please take a look at these links/resources.
In the meantime, here’s a quick overview of OKRs:
Objectives are the thing to be completed, and the key results are the broken-down steps that must be accomplished to get there. They are a blend of S.M.A.R.T. (Specific, Measurable, Aligned, Relevant, Time-based) goal methodology and MBO. They work so well because they impose both cascading alignment of goals and the breaking down of ambitious goals into more manageable smaller steps.
For best results, they should be set quarterly or along a similar timeframe, and in order to track success, they must be “as measured by” something. Oftentimes, OKRs have a number or percentage assigned to them; if not, they are likely operational goals. You should incorporate a mixture of both so that employees don’t feel overwhelmed by too many aggressive goals, nor will they become bored and disengaged with goals that they know they can complete 100% (operational goals).
Why Google Loves Them
Already, you can probably begin to see why Googlers are such fans of the OKR process. By assigning a numerical measurement to each OKR, Google managers and associates collect data about what’s working and what’s not in terms of goal achievement.
Here are some other advantages that OKRs present for Google (which can be experienced in any company):
- Drive focus and create alignment so all efforts support company-level goals
- Increase transparency because everyone gets a line of sight into individual and team goals
- Encourage discipline because every contributor plays a distinct role in contributing to larger company objectives
- Create easy and effective ways to measure progress
How OKRs are Different
When Google first introduced OKRs, MBOs were still the norm for many businesses. While OKRs are indeed inspired by this process, they are different in the fact that they do not rely on a top-down approach. Because MBOs took a top-down approach to goal setting, goals were often set and then lacked follow-through. Without checking in on progress regularly, it was easy for goals to be forgotten. OKRs, instead, involve every single associate in the company, and with effective practices such as weekly one-on-one meetings, they not only encourage but actually require follow-through and commitment.
What You Can Do to Achieve Google-Level Success
One of Rick Klau’s most noteworthy statements in the Google OKR video is his claim that everyone should stop saying that they can’t be like Google. He insists that in fact any company can witness the levels of success Google has by committing to the OKR process. Here are some ways you can optimize the OKR process for best results:
- Impose a limit (no more than 4-5 OKRs per quarter)
- Get buy-in and commitment by encouraging manager/employee collaboration
- Don’t require 100% completion for aspirational goals; instead, let employees know that it’s okay to not complete them in totality – some success with aggressive goals is better than none
- Allow individuals to set at least half of their own objectives (with approval from managers)
Performance Review and OKRs
While Google maintains that OKRs should not be linked to performance reviews, it’s not impossible to link them. In fact, it would likely be impossible not to incorporate any OKR data into your performance management system. After all, effective goal setting and tracking are critical components of a strong performance management system, and OKRs are a form of goal setting. Ultimately, it’s up to you to determine how (and whether or not) you’ll link performance review to OKRs, but it should ultimately fit with your existing company processes, culture, and values.
What OKRs Mean for the Future
Companies that choose to implement OKR goal setting in conjunction with weekly one-on-one meetings will create a powerful system for boosting performance, driving employee engagement, and edging out their competition by achieving powerful results. With that being said, the more ambitious, fast growing, or large a company is, the more complex OKRs have the possibility of becoming. As such, more and more executives are implementing software solutions to facilitate an easy-to-use, trackable, data-oriented approach to OKRs. Doing so is what could take OKRs from being an effective practice to being the very practice that excels your company and allows you to witness first-hand the same levels of success that Google did.
Do you manage a company or teams (either as a CEO, a senior executive, a middle manager or even a front-line manager)? Do you set and track objectives? Does aligning employee performance to business goals matter, and are you responsible for driving results? If so, please check out a live demo of Atiim OKR & Goals Management Software and we’d love to hear what you think about it. Thank you!