What is an OKR?

OKR stands for "Objectives and Key Results." It's a popular framework used by organizations to define and track objectives and their outcomes. The OKR system is designed to improve focus, alignment, and engagement within teams and organizations. Here's a breakdown of the two components:

Objective: This represents what one wants to achieve. Objectives should be qualitative, ambitious, and inspiring. They give a clear direction about what the company, team, or individual is aiming towards. Example: "Become the top seller of eco-friendly travel gear in the region."
Key Results: These are specific metrics that measure the progress towards the Objective. Key Results should be quantitative, actionable, and time-bound. They provide a way to gauge progress toward meeting the Objective. Example (for the above Objective):
- Increase quarterly sales by 20%.
- Launch 3 new eco-friendly products by the end of Q2.
- Reduce product return rate to below 2%.

OKR History

The OKR methodology can trace its origins back to the 1950s, but it became more prominent in the tech world in the latter part of the 20th century. Here's a brief history:

1950s - Management by Objectives (MBO): Peter Drucker, a renowned management consultant, developed a system called Management by Objectives (MBO). While not the same as OKRs, MBOs laid the groundwork for goal-setting processes in organizations.
1970s - Birth of OKRs: The specific OKR system was formulated by Andy Grove at Intel. Grove introduced the system to help manage and guide Intel through the rapid changes and challenges of the semiconductor industry at the time.
John Doerr's Influence: John Doerr, who was an Intel employee, learned the OKR system under Andy Grove. Later, in the late 1990s, Doerr, as a venture capitalist at Kleiner Perkins, introduced the OKR methodology to a young company called Google. Doerr's presentation to Google's leadership, including Larry Page, Sergey Brin, and Eric Schmidt, led to the adoption of OKRs within Google, which still uses the system today.
Adoption in the Tech Industry and Beyond: Google's success with OKRs led many other tech companies to adopt the system. Today, many organizations, both inside and outside the tech industry, use OKRs for goal-setting and performance measurement.

John Doerr's book "Measure What Matters" provides a comprehensive look at the history and implementation of OKRs, offering insights from various leaders and organizations that have adopted the methodology.

What Makes Good OKRs?

Creating effective OKRs requires a thoughtful approach to ensure they truly drive focus, alignment, and engagement within an organization. Here are some attributes that characterize good OKRs:

Aligned with the Company's Mission and Vision: OKRs should not be created in isolation. They should cascade from the company's overarching mission and vision, ensuring that everyone is working towards the same strategic direction.
Specific and Clear: Ambiguity is the enemy of effective goal-setting. OKRs should be clearly defined so everyone understands exactly what is expected.
Measurable: The "KR" in OKR stands for Key Results, which should be quantifiable metrics. This allows for clear tracking and assessment of progress. E.g., "Increase user base by 15% in Q2."
Ambitious yet Achievable: Objectives should be challenging, pushing teams to stretch beyond their comfort zone. However, they shouldn't be so far-fetched that they become demotivating.
Time-Bound: OKRs typically have a set time frame, often quarterly or annually. This creates a sense of urgency and a clear deadline for achieving results.
Limited in Number: While it's tempting to set numerous objectives, it's more effective to limit the number of OKRs to maintain focus. A common practice is to have 3-5 key objectives, with 2-5 key results per objective.
Transparent: OKRs are often shared openly within organizations. This transparency ensures everyone knows the priorities, fosters collaboration, and creates accountability.
Regularly Reviewed and Updated: Setting OKRs is not a "set it and forget it" activity. Regular check-ins, progress updates, and reviews are essential. This iterative process allows teams to adjust as needed and respond to changing circumstances.
Balanced: While performance metrics are crucial, it's also essential to consider OKRs that foster innovation, team development, or other qualitative measures.
Owned: Every OKR should have a clear owner who is responsible for driving progress and achieving the results.

In essence, good OKRs inspire action, provide clarity, and allow teams and individuals to understand their impact on the organization's broader objectives.

OKRwise

What is an OKR?

OKR History

What Makes Good OKRs?

When you're transparent about your goals, you create a culture of accountability.

What is an OKR?

OKR History

What Makes Good OKRs?

When you're transparent about your goals, you create a culture of accountability.

This website uses cookies.