Execution · Organising to Growing
OKRs: a goal, and how you know you've got there
You write an OKR with a goal in plain words and two to five key results that show, without argument, whether you've got there. Then you derive your teams' OKRs from it.
Does this sound familiar?
- Your key results are a to-do list: three webinars, a new brochure, an updated website. It's all done, and revenue is right where it was.
- At the end of the quarter you spend half an hour arguing about whether 'improve customer satisfaction' worked.
- Every quarter everything's at a hundred per cent, and the company barely grows.
- The leadership team has OKRs, but the teams don't know what their part in them is. Or the managing director writes every team's OKRs personally.
Who it's for, and when
For founders, members of the leadership team and team leads with a goal for the quarter where the route isn't fixed yet. It starts in Organising and matters most in Growing, when teams decide for themselves how to reach a goal. In Proving it's usually too early: you don't yet know which number counts. Pick a few rocks and one or two driver KPIs instead.
The model
“The objectives are what you want to have accomplished. The key results are how I'm going to get that done.”
An OKR has two parts. The objective says where you want to go, in plain words: 'Customers stay with us longer'. The key results say how you'll know you've got there, as numbers with a starting point and a target: 'Cancellations down from 12 to 6 per cent'. A key result is an outcome. The work that should move the number goes underneath as tasks, and if that work doesn't do it, you pick different work. Grove wanted you to be able to tell afterwards, without argument, whether it had worked.
An OKR is a number that has to move while the route is still open. If you already know exactly what needs finishing, it's a rock (the lesson A rock you actually hit). The number itself stays on the scoreboard as a KPI as well (the lesson Result KPIs and driver KPIs). Doerr distinguishes two kinds of OKR. A committed one has to be hit in full, for example because the bank is counting on it. An aspirational one sets the bar high on purpose, and 0.7 counts as a good score.
In a company with teams, you derive each team's OKRs from the company's. A company key result often becomes a team's objective, and the team writes its own key results that it can actually move. That way the team chooses how it contributes, and the team lead owns their OKR. Not every team has to hang off every company goal, and not every OKR has to come from the top. Doerr lets a large share come from the bottom up.
Andy Grove at Intel, described in High Output Management (1983). John Doerr learned it from Grove and took it to Google in 1999; he wrote it up in Measure What Matters (2018).
Objective
Where you want to go, in one sentence with no numbers. Your team should understand it without an explanation. 'Customers stay with us longer' says more than 'Retention optimisation'.
Two to five key results
Numbers with a starting value and a target, which you can already measure today. Together they prove the objective. Pick two that keep each other in balance, such as a count and a value, so you can't hit one at the expense of the other.
Committed or aspirational
Agree it up front and put it in the description. For a committed OKR, 1.0 is the bar. For an aspirational one, 0.7 is good, and 1.0 is often a sign the bar was too low. In Boldcaster an OKR is coloured by progress against time elapsed, and when you close the quarter, 70 per cent counts as partly achieved.
From company to team
The team picks which company key result it can move, turns that into its objective and writes its own key results underneath. The team lead takes them to the leadership team. The leadership team checks whether together they carry the company goal, and leaves the how to the team.
Pitfalls
Cascading everything down
Every company goal gets a copy for each team, with the same number in it. The team can't move that number on its own, and doesn't feel it owns it. Only let a team take part where it can change something, with key results in its own work.
Only looking at the end
An OKR you only open at the start and the end doesn't steer anything. Update the current value every week or two, and you'll see in time which number isn't moving and can pick different work.
Watch and read
The inventor himself in two minutes: an objective is the direction, a key result is measurable, and afterwards you can see without argument whether you hit it.
Watch on YouTubeDoerr explains in four minutes how an objective and two to five key results make up one goal, with an example.
Watch on YouTubeA lesson from the course run by Doerr's own organisation on how teams' OKRs line up with the company's.
Watch on YouTubeTo go further
Why a team without a measurable goal works hard and still doesn't know whether it's getting anywhere, with Grove at Intel and Google as examples. From 2:14, the definition: the what and the how.
Watch on YouTubeRead
Measure What Matters
John Doerr · 2018 · ISBN 9780525536222
The book on OKRs: how to write an objective and key results, how teams line up their OKRs, and why 0.7 is good for an aspirational OKR. Lots of examples, and a quick read. UK edition: ISBN 9780241348482.
View the bookHigh Output Management
Andrew S. Grove · 1983 · ISBN 9780679762881
The source: Grove describes how Intel worked with goals and measurable results, which is where OKRs come from. Broader than OKRs, about managing in general. This ISBN is the 1995 edition.
View the bookApply it
- 1
Write the objective in one sentence, with no numbers
Where do you want to be in three months? Write it so your team understands it.
- 2
Ask: how will I see we've got there?
Name two to five numbers, each with a starting point and a target. If one of them is an activity, ask what it should deliver: that number is the key result, and the work becomes a task. If you can't measure a number today, sort that first or pick another one.
- 3
Agree: committed or aspirational
Say it out loud in the meeting and put it in the description. With an aspirational OKR, everyone then knows 0.7 at the end is good.
- 4
Let each team derive its own OKR
Give the team leads the company's OKRs. Each one picks which key result their team can move, writes their own OKR under it and puts it forward within a week. Don't rewrite it yourself; ask how it contributes to the company goal.
- 5
Update the current value every week or two
Enter the new value on each key result. If a number hasn't moved after a month, pick different work.
Examples
Template: an OKR
Objective: [where you'll be in three months, in plain words] Key result 1: [number] from [start] to [target] by [last day of the quarter] Key result 2: [a second number that keeps the first in balance] Type: committed or aspirational Owner: [one name] Tasks: under each key result, the work you'll try first Check: at the end, can you see without argument whether it worked? Has any work slipped in among the key results?
From company to team: a software company
Company. Objective: customers stay with us longer. Key results: cancellations per quarter down from 12 to 6 per cent; customers who become active in their first month up from 55 to 75 per cent. The support team takes the second key result. Objective: every new customer is up and running within a month. Key results: customers with a kick-off call in their first week up from 30 to 90 per cent; support questions in the first month down from 8 to 4 per customer. The product team tackles the same key result differently. Objective: a new customer quickly sees what we're worth to them. Key result: days to the first report down from 9 to 3. The sales team doesn't hang off this goal. Its OKR is about new customers.
Committed and aspirational side by side: a wholesaler
The leadership team set 'on-time delivery up from 91 to 99 per cent' as an aspirational OKR and reached 96. That counted as good. Alongside it sat a committed OKR: stock in days down from 75 to 55, because the bank had made that a condition of the loan. That one had to be hit in full, and it was.
Do this in your own business
Everything up to here is free. What you fill in for your own business, you keep in Boldcaster.
- Go to Priorities. Choose New, then OKR. The objective is the title; underneath you add two to five key results, each with a Unit, Direction, Baseline and Target, and the tasks under each key result. From Bold Pro you can give an OKR a team, and use Filter to see one team's OKRs.
- You assign the lesson to your team and see who has done it.
- The quiz counts towards your progress, and you see which lesson comes next.
Four weeks free. You'll land straight in this lesson.
Quiz
7 situations. You need 6 of 7 right. You can try again at any time.
1.A consultancy has the objective 'clients recommend us more often'. One key result reads: 'NPS survey sent to all clients'. What do you do?
2.A construction firm wants the key result 'cost of rework down from 4 to 2.5 per cent of revenue'. The accounts don't record rework costs separately anywhere. What do you do?
3.The bank will only extend the loan if the solvency ratio is at least 30 per cent on 31 December. Right now it's 24. How do you set up that OKR?
4.An online shop has an aspirational OKR with the key result 'returns down from 18 to 12 per cent'. After six weeks it's at 11. What do you do?
5.A haulage company has the key result 'delayed journeys down from 14 to 8 per cent'. After five weeks it's stuck. The team suggests replacing it with 'new planning software live'. What do you do?
6.The company has the key result 'cancellations down from 12 to 6 per cent'. The support team lead puts exactly that key result under their team's OKR too. What do you advise?
7.You want the four teams to have OKRs. You've written them yourself for every team in one evening. What's the best next step?
Nothing is saved here. In the app, the quiz counts towards your progress.
Read next
- Result KPIs and driver KPIs · You work back from a result to what your team needs to do every week, and choose the driver KPIs that predict that result.
Not sure where to start? Take the growth scan