One of the most important tasks a manager or team leader has is finding ways to motivate employees and drive productivity. This can also be one of the toughest challenges they face.
Most if not all employees need some form of guidance, encouragement, and engagement to do their best work. But this isn’t always easy to provide. This is evidenced by the fact that less than one-third of American employees feel engaged in their roles in a given year.
Herein lies one of the benefits of implementing OKR in a business. If you’re wondering “what is OKR?” this guide is a great place to begin. Read on to learn all about this goal-setting and goal management framework and whether it’s something that could benefit your business.
What Is OKR?
OKR is an acronym that stands for the phrase Objectives and Key Results. It’s a kind of framework that’s commonly used in organizations to help employees in planning, managing, and achieving the goals they’ve set for themselves.
It’s a system that’s designed not only to help employees to achieve more but also to set goals that are more realistic, actionable, and productive. The intent behind OKRs is to focus on and clarify goals and the results we want from them.
A Brief History of OKR
OKR is a concept that was first thought up by a man named Andrew Grove who was working for Intel at the time. Grove had modified a concept from another man, Peter Drucker. Drucker is known as the godfather of modern management, having written extensively on workplace dynamics and methodologies.
Drucker had an acronym of his own: MBO which stands for Management by Objectives. This was a concept that set out standards for goal setting and was what Grove used as the basis for what eventually became the OKR. In 1999 Grove introduced the concept of OKR to Google’s founders and the rest is history.
The Principles of OKR
The principles of OKR are striking in their simplicity, which is what makes them so successful for so many businesses. Every time you set an OKR there are three major components you’ll need to remember. These are:
- Your objective
- The key results
- A Timeframe
Any objective you set for yourself should be answering one question: “Where do I want to go?”. An objective describes in detail a specific point you want to reach and sets a clear direction to do so. Some examples of objectives might include:
- Hitting 10,000 units of sales
- Publishing 50 blogs
- Lowering site load speed time to 2 seconds
OKR formula states that each objective you set for yourself should have around three key results attached to it. These key results can be thought of as the measurable outcomes that are required to achieve a given objective. They will set the tone and pace for your objective.
One of the most important aspects of the OKR framework is the timeliness of each objective. Having a concrete timeframe keeps employees motivated to push toward their goals. OKRs are often set on a quarterly basis, but depending on the type of team you’re on, they might be revisited on a monthly or even weekly basis.
Benefits of Implementing OKR
Simply because of its longevity and how widely it’s been adopted, we can see that OKR is a system that works for many businesses. So, what are some of the benefits that managers and employees report?
The most obvious benefit of OKR is increased employee productivity. Goal setting is incredibly helpful in helping workers to achieve more and push themselves to work harder. It allows employees to prioritize their work more easily and measure whether they’re on the right track to achieve the things they’ve set out to.
Aside from a more productive workplace OKR can help foster a positive environment in other unexpected ways as well. It’s a great tool for increasing openness, communication, and transparency within an organization. It increases individual accountability but especially on teams that work closely together it also creates a culture of shared responsibility and encouragement.
Is OKR for Everyone?
We’ve spent a lot of time singing the praises of this framework which does beg the question is OKR for everyone? The simple answer is no. But this is one that requires a much more in-depth explanation.
It should be said at the outset that there’s rarely a solution or system or framework that is truly “one-size-fits-all”. Different organizations have their own idiosyncratic ways of operating. Because of this OKR won’t be suited to all companies or all employees.
OKR is a framework that’s thought to be well suited to agile organizations, for example, though it’s also used by a much wider range of businesses than this. But there are certain types of workers or workplaces for which this methodology might very much not be a good fit.
If a company has many cross-functional teams it can be difficult to set and then assess the success of productive goals. Similarly, if a business is short-staffed or short on time it might not have the resources to put into setting up and maintaining this framework. At certain stages, a company might be more focused on creative output than on objective outcomes.
None of these things are necessarily wrong. All it means is that OKR wouldn’t be a good fit for an organization like this. If you’d like more examples of reasons OKR might not fit a business you can go right here.
Should You Implement OKR for Your Business?
If at the beginning of this article you were wondering “what is OKR?” we hope that by now all of your questions have been answered. OKR can be an amazing way to motivate employees and boost your business to new heights. But it’s important to make sure it’s a good fit for you and your employees first.
If you’re looking for more actionable advice for the workplace, we’ve got you covered. Check out the rest of our articles now.