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In this article

Goal setting with OKR framework

SNATIKA
Published in : Generic . 10 Min Read . 1 year ago

Introduction

One of the critical elements of any project is proper goal-setting. Setting goals and striving to achieve them within a deadline without compromising quality is what every organisation seeks. Every task that needs to be finished needs to be planned accordingly and properly executed. While most companies have managers to maintain these tasks, proper goal setting can be easily overlooked. A well-defined goal can boost the team's drive and make seemingly impossible tasks suddenly achievable. For this, breaking up the goal into smaller parts and establishing easily achievable milestones can help. Even then, some goals that involve the overall development of the company can still be difficult. This is where the OKR framework comes in.

What is the OKR Framework?

OKR is an acronym for "Objectives and Key Results." It has been around since the 1970s. It was created by Andy Grove (Source: Wikipedia). However, it was John Doerr, who was one of the earliest investors in Google, who popularised the framework. Due to the innovative and experimental nature of Google, the OKR framework was quickly adapted and incorporated into the company's operational structure. Soon, other corporate giants like Dropbox, Twitter, Spotify, LinkedIn, and Airbnb adapted the framework on their own (Source: Employment Hero).

Why is Goal setting important?

In traditional goal-setting methods, individuals would decide on a task and start doing it head-on. One popular example of this type of goal setting would be "New Year's Resolutions"! If you're like most individuals, on December 31st or a day before your birthday, you take your time to look back on the year and see the void in which you could have filled so many hobbies. You mentally note down a list of tasks you want to achieve within a year and promise yourself that you will not fall away from your resolutions. Only a few individuals actually wrote down their goals, planned accordingly, and incorporated their resolutions into their daily routines. The rest? Most of their resolutions go down the drain sooner or later.

 

However, this kind of attitude won't do if you really want to succeed personally or professionally. In your workplace, such an attitude toward goals is simply unacceptable. In this ever-changing business world and the subsequent risk factors and competitiveness from across the globe, proper goal setting and achieving them are the number one priority for every company. Among a few other goal-setting frameworks, the OKR framework can minimise it and nullify such gaming away from your goals.

OKR vs. KPI vs. SMART

If you have been in the industry for a while, you must have been working with KPIs, or key performance indicators. At first glance, both OKR and KPI look similar. However, they are both different in how they work and for what purpose they are used. KPIs are used more on an individual level within the organisation for reporting measures and progress. The OKR framework, on the other hand, is established at the organisational level. It not only involves goals and performance measurements but also includes clearly defined steps to achieve those goals.


You can safely say that OKR is an evolved form of KPI. Moreover, you don't have to abandon KPIs in favour of the OKR framework. Finally, OKR is more aggressive and ambitious. The progress is measured on a regular basis, like weekly or biweekly. Once 3/4 of the objectives are achieved, the objective is considered complete. If 100% of the results are achieved, that means the framework was insufficiently ambitious.

 

SMART goals are on the other side of the spectrum, which is also considerably popular. However, unlike the OKR framework, SMART goals are only focused on goals in the absence of objectives for making the goals a reality. There are also several other frameworks for setting goals, like FAST, which will be discussed in other articles.

How to use the OKR framework

Finally, this is where you will learn how to use the OKR framework. The most important thing you have to remember is to keep it simple and flexible all the time. Your approach to implementing the framework can affect the results as well. Always keep an eye on your people skills, management skills, and adherence to your goals. Make sure your goals align with your company's values so that you may avoid financial losses. You have to remember to keep it simple and flexible all the time.


Your approach to implementing the framework can affect the results as well. Always keep an eye on your people skills, management skills, and adherence to your goals. Make sure your goals align with your company's values so that you may avoid financial losses. Again, carefully create a framework to measure progress and performance, without which it will be ineffective.

 

An OKR framework consists of three major aspects.

  1. 3 to 5 clearly defined objectives

  2. 3 to 5 measurable key results

  3. a progress indicator for each result on the numeric scale.


OKRs contain the five high-level objectives and key measurable results for each of them. If you have more than 5, then it is not a good idea. While bigger organisations can handle the five objectives effectively, smaller teams might do well if they settle for a lesser number of objectives. After seeing these goals, track the progress using the goals as your reference points. Saying no to unwanted tasks can help you avoid traits like scope creep and thus result in an overall improvement in performance.

Establishing the OKR framework

Typically, the OKR framework is created for highly ambitious and nearly impossible goals with tighter deadlines. The normal duration of a framework would be a quarter of a year. However, due to the size of the goal, it may take more than one quarter to succeed. The team would first hold a brainstorming meeting where they would discuss which goals should be prioritised and how. According to Atlassian, "What are the most important impacts they need to make in the coming quarter?" can easily get you your priorities. For further information, refer to the examples below.

 

Establishing the OKR objectives is the first step. And afterwards comes the price measurement stage. The framework uses a percentage, or a skillful average, of 1 to 10 to measure results. If the score after the stipulated time is 30%, which is 0.3 on the scale, then you have missed your mark. 70%, or a 0.7 mark, means you have succeeded in the project. As mentioned earlier, 100% results are generally an indication that the framework was not ambitious enough. After establishing the objectives, you must define key results. Key results are not to be confused with to-do lists. They are parameters that define the priorities of the business. Here are some examples.


For example, "Add this feature within this quarter" sounds uninteresting. Instead, use "Adding this feature within this quarter will bring three times more customers." This makes the goals, progress, and results measurable. In each team, there must be a leader who measures all these processes so that they can be improved.

Examples for OKR framework

Some examples of OKR high-level objectives are here so that you can set the framework for your own target goals.

Improve customer satisfaction.

Objective: Increase the number of followers on social media.

Key results

  • Scale your small business with five more branches.

  • Reduce the number of errors.

  • Identify key results.

Sales group goals

Objective: Develop the best sales team in the industry.

Key Results

  • Refine the onboarding process.

  • Hold regular coaching sessions every week.

  • Improve sales training with the help of experts.

  • Conduct anonymous surveys and get feedback every month.

Community manager goals

Objective: Launch a new customer community.

Key results

  • Create a customer community strategy built on best practices.

  • Start an exclusive blog and publish 30 articles.

  • Find 30 new customers this month.

Human resources goals

Objective: Create an exceptional corporate culture.

Key results

  • Launch a two-way feedback loop.

  • Achieve a weekly employee satisfaction score of 8 or higher.

  • Celebrate every small win with team members weekly.

Pros and cons of the OKR framework

The advantages of OKR framework

1. Simplicity is synonymous with the OKR framework

The framework is easy, logical, and adaptable. This simplicity can boost the team's motivation as it makes the process easier. A less daunting goal-setting process keeps the team's momentum going.

2. The OKR model is transparent

Though the decisions are made at the higher levels or in a brainstorming meeting, all the employees are educated about the process. They are made aware of the framework, goals, results, and progress measurements. Nothing is left to guesswork.

3. It motivates employees

The autonomy in the key decision-making process and the ability to engage in making the ambitious challenge a reality can be motivating factors.

4. Regular meetings can boost engagement

These can boost employee engagement and performance. As teams gather, discuss, and brainstorm new ideas, this can be an existing experience for everyone.

5. Progress measurements are easy

As the progress is measured numerically, it is easy to stay motivated despite challenges as one can see how far they have come since they started at zero.

The disadvantage of OKR framework

1. Maintaining the process is hard.

The system is not viable for independent or individual use. Often, special software is required, and large amounts of data must be processed, manipulated, and visualised for results. Individuals forget to update their Excel files, which results in various errors in the results. Only large teams with ID corporations can make this work in their teams. Maintenance is also cumbersome, and experienced professionals are required for the process.

2. Negative effects on employee or team morale

If a project does not meet the standards set by the OKR system, it is considered a failure regardless of the circumstances. It can have a deep impact on the team's morale as they see this as a failure, which results in dissatisfaction with the jobs.

3. The framework can be compromised

Goal setting can be rigged by setting three easier key results and one impossible key result. This can easily result in the "golden 75%," but negates the purpose of the system. Well-trained teams can use such goal-setting to cheat the system, which makes it an undesirable process in the first place.

4. Not applicable to non-numerical goals

Some important goals for an organisation cannot be quantified in numbers or percentages. In such cases, the OKR system is not worth the time or effort. There are also several projects that cannot be limited by a timeline.

Should you use it?

As was mentioned earlier, the OKR framework is suitable for larger teams and corporations. Individuals struggle to maintain the system for long due to the complexity of the framework. Hence, it is preferable to have larger teams where you manage large projects or company staff. For individual use, the SMART framework can be more suitable. However, you can also implement the OKR framework without the added complexities by making it simple and easy. There are several online websites and apps for this process, all of which you can use to your advantage.

Conclusion

Finally, goal setting is an important element of the process. It gives you an end and an aim. However, this is not enough for individuals to follow through. They need a specifically laid out path to follow through. They need steps outlining milestones within a timeline that can give them an idea of the whole process. Only such a system can influence them and drive them to perform better. Challenging preconceived notions about work and work patterns must be encouraged without rigid rules.

 

The OKR framework gives management professionals just that. While the key results can be difficult to achieve within the stipulated time, it also gives the team members a challenge and induces curiosity, performance, and productivity. Now often than not, the project meets more than half of the key results within the timeline, which is considered a successful undertaking within the framework. Anything above 75% of the project's key results means the goal-setting process was flawed and needed more challenging goals to tackle. While the system has several benefits, it also has complexities. Balancing out both aspects must be the management professional's test of efficiency.

 

Ultimately, SNATIKA offers highly prestigious UK Masters degree programs to senior management professionals. Our online programs offer you flexibility, cost-effectiveness, and dual qualification within 12 months! If you need a higher academic qualification from the UK, visit SNATIKA now!



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