Are your teams working hard but still not meeting business expectations? Despite setting ambitious goals, are you struggling to see the results? This is a common pain point for many businesses. Aligning teams and ensuring everyone works toward the same goal is a challenge.
OKRs (Objectives and Key Results) can address this problem effectively. Used by leading companies like Google and Intel, OKRs don’t just help set clear goals but also ensure that those goals are met with measurable progress. Let’s explore how this framework can bring alignment and success to your organisation.
In this guide, we'll break down OKRs and show you how to create meaningful objectives and measurable key results. Whether you’re a founder, HR professional, or finance manager, OKRs can help bring focus, alignment, and better performance to your organisation.
Curious how OKRs can change your business? Let’s get started.
OKR stands for Objectives and Key Results. It is a powerful framework for setting goals and tracking progress.
Example: Let’s say a sales team wants to boost revenue. Their objective could be to increase overall sales revenue by 20% this quarter.
To measure progress, the team would define key results:
Key Result 1: Close $500,000 in new sales deals.
Key Result 2: Improve conversion rate from leads to sales by 15%.
Key Result 3: Expand into two new markets.
In this scenario, the objective sets a clear and inspiring goal: Boosting sales revenue. The key results break that down into measurable actions the team can track and work towards.
By using OKRs, everyone knows the goal and how to measure success, creating focus and alignment across the team. Now that we understand what OKRs are, let’s understand its two key elements, objectives and key results, and see how these work together to form a structured goal-setting system.
OKRs have two key elements: objectives and key results. These elements form a framework that guides organisations in setting clear, actionable goals and staying focused on what truly matters.
Objectives: Setting Clear Goals
An objective is what you want to achieve. It’s the big-picture goal that gives your team direction and purpose. A good objective should be clear and inspiring, motivating the team and aligning with the company’s overall mission.
Objectives should also be broad. They should not be concerned with specific steps but with the desired outcome. The goal is to make the objective meaningful and challenging, motivating the team to give their best effort.
For example, if a marketing team wants to increase the company’s visibility, it might set the objective of increasing brand awareness by 30% over the next six months.
This is clear and challenging. It provides the team with a sense of purpose, boosts brand awareness and sets a measurable target aligned with the company’s growth strategy.
Key Results: Tracking Progress with Measurable Outcomes
Once you’ve set your objective, it’s time to define how you’ll measure success. Key results are the specific, measurable outcomes that track progress toward your objective.
Key results should be actionable and provide a clear way to assess whether you’re on track. They break the broader objective into tangible steps, and because they’re measurable, they make it easy to know whether or not you’re succeeding.
For example, the marketing team’s key results could look like this:
Key Result 1: Increase website traffic by 50% through targeted social media ads.
Key Result 2: Gain 5,000 new followers on Instagram and Twitter.
Key Result 3: Get 20 media mentions in industry publications.
Each key result is something the team can measure directly, such as tracking website visits or counting the number of new followers. These specific benchmarks help the team stay focused on achieving the overall objective.
How Objectives and Key Results Work Together
Think of the objective as the destination and the key results as the map to get there. The objective provides the vision, while the key results outline the steps needed to achieve that vision. Together, they ensure everyone knows what they’re working towards and how success will be measured. Here’s a simple breakdown:
Objective: This is the overarching goal, something that is inspiring and direction-setting.
Key Results: These are the measurable outcomes that track your progress toward that goal. They help you stay focused on tangible achievements.
By using OKRs, teams can stay focused on what matters, measure progress easily, and adjust course when needed. It’s a clear, practical way to ensure everyone is aligned and working toward the same goal.
OKRs didn’t appear overnight. The framework of OKRs was developed by Andrew Grove, the former CEO of Intel, in the 1970s. He needed a way to align his team and measure performance, especially as Intel grew rapidly. His solution was simple yet powerful: set clear, ambitious objectives and measure progress with key results.
Grove’s approach to goal-setting at Intel became the foundation of today's OKR system. His method focused on keeping everyone at Intel aligned with the company's larger goals while tracking measurable progress at every level.
However, OKRs gained widespread attention when John Doerr, a former Intel employee, introduced the concept to Google in the late 1990s. At the time, Google was a small start-up that was quickly growing and needed a clear way to focus its efforts. Doerr shared the OKR framework with Google’s founders, Larry Page and Sergey Brin, and they adopted it across the company.
By setting clear objectives and tracking key results, Google maintained alignment as it became one of the world's largest tech companies. Google’s use of OKRs is one of the real reasons it has stayed on its long-term goals of achieving short-term success. With a clear understanding of OKR’s evolution, let’s go step-by-step through the process of creating effective OKRs that drive action and align your team.
Creating effective OKRs requires a structured approach. Below are the key steps to set OKRs that motivate your team and align with your company’s goals.
Step 1: Set Clear and Inspirational Objectives
The first step in creating impactful OKRs is defining your objective. This is the “what” you want to achieve. Objectives should be clear and inspiring, giving your team a sense of purpose and direction. The goal is to make the objective something that excites the team and drives them to work toward it.
Why does it help?
A clear and inspiring objective sets the tone for the entire team. It aligns their energy around a shared vision. Without a strong objective, goals can become disjointed and difficult to measure.
How to do it effectively?
Ask yourself, "What do we want to achieve, and why is it important?" For example, if your company wants to increase its market share, your objective might be to increase it by 15% in the next six months.
This objective is broad yet challenging, providing a meaningful goal that pushes the team toward measurable results.
Step 2: Define Measurable Key Results
Once the objective is clear, the next step is to define key results. These specific, measurable actions track your progress toward the objective. Key results should be tangible and provide clear indicators of success.
Why does it help?
Without measurable key results, it’s hard to gauge whether progress is being made toward the objective. Key results break down the broader goal into manageable, trackable actions. They give the team a sense of direction and allow for clear accountability.
How to do it effectively?
Focus on outcomes, not activities. For example, for the marketing objective of increasing market share, key results might look like this:
Key Result 1: Increase website traffic by 30%.
Key Result 2: Generate 500 qualified leads per month.
Key Result 3: Secure 10 new partnerships with key industry players.
Each key result is specific, measurable, and time-bound, allowing the team to track their progress throughout the quarter.
Step 3: Ensure Alignment with Organizational Goals
Ensuring that your OKRs align with the broader organisational goals is important. When OKRs are aligned, everyone moves toward the same destination. Misalignment between individual, team, and organisational OKRs can lead to confusion and inefficiency.
Why does it help?
Alignment ensures that every department or team’s efforts contribute to the organisation's larger goals. This creates a cohesive strategy that drives the company forward.
How to do it effectively?
Review your company’s broader goals and ensure your OKRs support them. For example, if your company’s main goal is to increase revenue by 20%, the sales team could close more deals, while the marketing team might focus on generating more leads.
Step 4: Make OKRs Ambitious but Achievable
One key to effective OKRs is making them challenging but achievable. Setting too easy of goals will not motivate the team to reach its full potential, and setting too difficult of goals can lead to frustration and burnout.
Why does it help?
Ambitious OKRs push teams to go beyond their comfort zone. But they should still feel achievable. This balance helps maintain motivation and productivity.
How to do it effectively?
Set goals that stretch the team’s abilities but remain realistic. For example, aiming to increase sales by 25% in one quarter might be ambitious but still within reach with the right resources.
Step 5: Regularly Track and Review Progress
The final step is tracking the progress of your OKRs. Regular check-ins allow you to identify obstacles, adjust strategies if needed, and celebrate wins.
Why does it help?
Tracking progress regularly ensures that your team stays focused and adjusts its efforts as needed. It also maintains momentum and helps identify problems before they grow too large.
How to do it effectively?
Hold weekly or bi-weekly meetings to review progress. Use tools or software that make tracking easier. For example, if the key result is to increase website traffic, monitor the website analytics regularly to see how you're progressing.
These steps help you create clear, achievable, and aligned OKRs with your organisational goals. Each step helps ensure that the OKRs are motivating and measurable, providing a roadmap for success.
Step 6: Use OKR Tracking Tools
The next step is to use OKR tracking tools that help you monitor and visualise progress. Craze’s OKRs and Goals software simplify the tracking process, providing your team with real-time insights into their performance.
Why does it help?
OKR tracking tools allow you to centralise your OKRs, making it easier to update, monitor, and measure progress. These platforms can automate reminders, generate progress reports, and provide an overview of the key results, so everyone stays aligned and informed.
How to do it effectively?
Use tools such as Asana, Weekdone, or Quantive, which integrate with your team’s workflow or an all-in-one hrms Craze. Set up automatic reminders and notifications to ensure that everyone is on track. For example, if one of your key results is to boost engagement on social media, track your follower count, likes, and shares directly in the tool. This ensures that no important metric is missed, and teams are held accountable.
By using OKR tracking tools, you enhance visibility, encourage accountability, and streamline the tracking process. These tools provide a clear and efficient way to stay aligned, ensuring your teams hit their targets and continue to make progress.
Step 7: Foster a Culture of Transparency
The next step is to create a culture of transparency within your organisation. Ensuring that everyone has visibility into the OKRs across all levels promotes accountability and encourages collaboration.
Why does it help?
Transparency helps build trust within the team. When employees know what others are working towards and how their own efforts contribute to the bigger picture, it increases motivation. It also allows teams to share feedback and support each other in achieving collective goals.
How to do it effectively?
Make sure OKRs are visible and accessible to everyone in the organisation, not just senior management. Use collaboration tools or dashboards where progress is shared across departments. For example, if the sales team is working to achieve a revenue goal, ensure the marketing team can view progress and understand how their campaigns contribute to that goal. Regularly update OKRs and encourage discussions during team meetings to track progress and resolve any roadblocks.
Fostering transparency keeps everyone on the same page, improves collaboration, and enhances performance. When teams are aligned and understand their role in achieving the company’s objectives, they are more likely to stay engaged and motivated to succeed.
Step 8: Reflect and Adjust at the End of the Cycle
The final step is to reflect and adjust at the end of each OKR cycle. Whether you are reviewing quarterly or annual OKRs, it’s important to assess what worked well and what could be improved.
Why does it help?
Reflection allows your organisation to learn from both successes and failures. By reviewing key results and evaluating the progress made, you can identify areas for improvement and make adjustments for the next cycle. This helps refine the OKR process, making it more effective over time.
How to do it effectively?
After the cycle ends, gather feedback from all teams involved. Review the outcomes of each key result and assess whether the overall objective was achieved. For example, if the objective was to increase customer satisfaction by 20%, but only 15% was achieved, identify the challenges faced. Use this data to adjust strategies for the upcoming cycle, focusing on areas that need more attention or improvement.
Reflection fosters continuous improvement by making sure that teams stay on track, learn from past cycles, and adapt their strategies accordingly. It ensures your goal-setting process evolves, leading to better results and a more efficient approach to OKRs.
Each step ensures that teams stay motivated, on track, and aligned with the company’s objectives. This structured approach allows for ongoing growth and improvement, setting the stage for long-term success.
Implementing OKRs can transform the way your organisation sets and tracks goals. By focusing on clear objectives and measurable key results, teams stay aligned, motivated, and accountable. This approach drives progress and ensures that everyone in your organisation is working towards the same vision.
However, managing OKRs manually can become overwhelming, especially as your organisation grows. With Craze’s OKR software clubbed with performance review, you can simplify the process of setting, tracking, and achieving your goals. Craze provides an intuitive platform that keeps everyone aligned, helps teams stay on track, and makes it easy to measure progress in real time. No more scattered spreadsheets or complicated tracking—just clear, actionable insights at your fingertips.
If you’re ready to make OKRs work for your organisation without the hassle, Craze is here to help. Book a demo and see how Craze can help you streamline your goal-setting process and drive better results.
