When a company as powerful as Google talks about how they achieved success, CEOs listen carefully. Specifically, we took notes as Google exec Rick Klau described in-depth how Google has used an OKR tool (Objectives and Key Results) for more than 10 years to help their employees achieve alignment and clarity on company goals.
But Google’s not the only company that’s used an OKR tool to achieve incredible results. Other big companies are beginning to use this system, and you can, too. Take a look at the others who are using OKRs, and read on to find out the exact steps you can take to set and measure goals like Google.
Other Well-Known Companies Have Already Started Using OKRs
Google may be the trailblazer of OKRs, but other major companies are also using variations of OKR tools and next-gen performance management systems to set and measure goals. These companies include Accenture, Amazon, Deloitte, DropBox, Facebook, GE, LinkedIn, Microsoft, Netflix, and Twitter, just to name a few (see the full list here). Like Google CEOs, the execs of these companies are using OKRs as a tool to set goals and measure progress, which helps them achieve ambitious goals and sets them apart as frontrunners of their industries.
OKRs Blend Highly Effective Management Techniques into One Tool
OKRs are an evolution of pre-existing, ambitious goal-setting techniques. Their impressive history stands as proof as to why they’re so effective: OKRs strategically blend management by objectives (or “MBO”), a collaborative goal-setting technique first introduced by Peter Drucker in the 1950s, and S.M.A.R.T. goals, an approach which requires goals to be Specific, Measurable, Aligned, Relevant, and Time-Bound.
Andy Grove, former president of Intel, is credited as being the first person to begin using OKRs during the 1970s. According to the book summary of Inside Intel, Grove “insisted every employee have a written set of objectives and key results by which success or failure in achieving the objectives could be measured.” John Doerr, also an employee at Intel at the time, later brought the OKR tool with him to Google. He introduced the strategy to Google business execs in the 1990s, and they’ve been using it ever since.
The Top Tips for Using OKRs as an Effective Performance Management Tool
For starters, you must understand Os, KRs, and their purposes.
The “O” (Objective) is the thing that must be accomplished. It answers the question: “Where do we want to end up?” Objectives should be measureable. For operational (easy to accomplish) objectives, a measurement of complete vs. incomplete is sufficient; however, for more aggressive, aspirational objectives, it’s best to associate a number with them to be used as a metric. They should be set quarterly, with no more than 4-6 per quarter. They must be able to be passed up or cascaded downwards to become a KR that will act as a step towards one individual or department’s own Objective.
The “KRs” (Key Results) are the steps taken to accomplish the Objective. They answer the question, “How will we get to where we’re going?” KRs, like Objectives, should also be measureable (again, ideally with a number, but for operational goals, “complete vs. incomplete” is acceptable). Each O should have 3-4 KRs associated with it. KRs must be able to be passed across or cascaded downwards for alignment. KRs are further broken down into tactics (and then tasks) that help individuals determine the precise actions they need to accomplish each KR.
See the relationship between Os, KRs, and tactics illustrated below:
Now that you’ve gotten a crash-course on the fundamentals of OKRs (more in-depth information is available here), you can familiarize yourself with some of the key strategies that will help you get the best results from your chosen OKR tool:
- Use a Collaborative Approach for Buy-In and Commitment To get your employees committed to their OKRs, allow them to collaborate with management to determine their KRs. While objectives will always reflect company goals, the majority of the steps taken to get there should be set by individuals. This helps them understand that they have an active, valuable role in the OKR process, and it also allows them to capitalize on their strengths. Google execs strongly advise that not all OKRs should be set top-down; allow about 70% to come from the bottom up.
- Use Weekly One-on-Ones to Review OKR Progress Managers must meet once per week with each employee. These brief one-on-one meetings have a distinct purpose, which is to track and discuss progress on OKRs. Too much happens in one week (not to mention the fact that you’re probably spending about $1,200 on each employee, according to the S. Bureau of Labor Statistics) to NOT check in and get clarity on expectations and progress. Each quarter is 13 weeks long, and as such, you need to verify that employees are completing about 10% of their OKRs each week (the first 2-3 weeks of the quarter should be considered a grace period). With weekly one-on-ones, your OKR tool becomes much more likely to help you and your team boost performance and secure wins.
- Stretch for Some Goals, But Keep Some within Reach OKR tools make aggressive goals possible because they align the entire company on priorities and allow everyone to measure ongoing progress so that readjustments to drive efforts farther or steer away from obstacles can be made in real-time. Google execs recommend setting goals that are so ambitious that the average completion is only about 70%. While that approach works well for aspirational goals, it’s also important to keep employee engagement and morale at a healthy level by assigning some operational goals that are 100% achievable. No employee would be satisfied with getting a 70% all the time; that’s why you need to balance your ambitious OKRs with operational ones.
Select an OKR Tool that Meets Your Company’s Needs
The B2B industry is facing a rare disruption, and there are many OKR tools available today to address that disruption. Executives are seeking out performance management solutions to assist them in their ongoing search to find a perfect tool to help them manage people effectively as they simultaneously measure goals and provide timely feedback to drive performance.
When it comes to adopting an OKR system that will work in their own company, many executives might feel that they could never do it the way Google did. But the truth is that Google began using OKRs when they were just a startup. And, their execs recommend using OKRs even for teams as small as one person. Thus, it’s possible for any company to experience benefits like Google did by using an OKR tool.
While the array of available tools can help CEOs and managers improve communication in numerous ways, Atiim is the only company that offers an all-in-one Weekly Report and OKR Goals Setting SaaS that allows executives to set and measure goals with one organized, easy-to-use system in which employee feedback can be exchanged.
Are you using an OKR tool to set and measure goals? How do you clarify objectives and keep your team aligned?
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!