Reaching goals couldn’t be simpler with OKRs
Let’s start at the beginning — what are OKRs? They are Objectives and Key Results. A process for setting, communicating and monitoring goals and results within an organisation. I’m not the only one who likes to use them, so does Google, Bill Gates, Intel… and Bono (if that doesn’t get you to use them, nothing will!).
I often meet entrepreneurs who are frustrated. They have plateaued, and they’re upset by that. They’ve lost self-confidence. They believe the team has lost confidence in them. Then teams are frustrated with inconsistent, unprioritised goals. I have worked in a number of high performing organisations that weren’t always high performing. I would like to think that I had something to do with their performance improvement, along with the use of OKRs.
Objectives and Key Results can help leaders and teams become aligned and innovate more quickly. In fact, results can be based on four main areas:
- Growth
- Performance
- Revenue
- Engagement
So, if those are the results, what is the process to get there?
1 – Identify the corporate 12-month key objectives, accountability for achievement and key results (the numbers to track progress to achievement)
2 – Now identify the most important next quarterly key objectives, those that underpin the attainment of the 12-month objectives. Assign accountability for achievement and key results to allow progress to be measured.
3 – Next break these objectives down into 13 weekly milestones
4 – Have personal objectives contribute to the achievement of the weekly milestones. Identify how we will measurably track progress and report — typically RAG (Red, Amber, Green)
5 – Hold daily huddles, weekly and monthly meetings to report progress and identify where you’re stuck. Quarterly meetings are used to report and to set the next quarters objectives
6 – Tell people what your objectives are. Share them. Use a totaliser (think Blue Peter and the local church fund!)
It’s all about communication and clarity. Each department, each team, each person knows what their objectives are. A rhythm is then set in place, with everyone on the same track, heading in the same direction.
I have never been to an organisation where staff have said management over-communicate, it just never happens! But communication is the only way people are going to know where they need to head. It’s how to engage staff.
- 58% say their employer is effective at helping them understand how their job fits into the company’s overall goals. Communication Climate Index, The Grossman Group, 2016
OKRs do work. I know that if I set myself a personal goal I’m more likely to stick to it. Take people who set themselves the target of running a marathon. You know the end goal is to get through all 26 miles, but you don’t start your first day of training by attempting to run the whole thing, you break it down into chunks. Just as we want to do in business. It’s also true that if you share your personal goal, and share your progress, your chances of attainment go way up.
I would advise making goals achievable. I know some people like to set high targets, but there’s nothing more depressing than knowing a goal is unachievable and still having to come into work each day with that knowledge. It’s demoralising and makes people feel like failures. I’ve worked with poor performing sales teams and taken their quotas down. Maybe even dropped them by half. Then every quarter we raise the bar (never less than the average of the previous two quarters) and you’ve got a mechanism to ratchet back up based on past success.
I’ve been in a few do or die situations where I didn’t know whether the goals I was setting were achievable, but they were necessary. When I took over as the MD at IT Lab we had three months cash left and if we didn’t get the business to cash flow positive in three months we were gone. We were losing £65,000 a month and we had to work really, really hard to generate sales opportunities. Everybody had to jump in and we did manage to save ourselves. But did I know we could hit those targets? No!
When I started at Peer 1 I used to rib the CEO that we were a metrics light organisation. We just didn’t track enough stuff, which led to people working on the wrong things. If you don’t measure it, you can’t manage it.
In a way, the strategy should be working out what NOT to do, then communicating why we are NOT doing these things. I hear all the time from front line employees at client workplaces, that the company starts loads of projects but it never finishes any. It pulls down morale and reduces faith in the leadership.
Monitoring is essential. If your team set themselves a 12-month objective they need to be constantly reviewing progress. What’s the point in leaving it to month 11? If they are not on target how are you going to readjust in a month? It’s madness. I like to adopt the philosophy of Verne Harnish. He’s written two amazing books called Mastering The Rockefeller Habit and Scaling Up. One of the things he’s taught me is the power of the daily huddle. It gives you an opportunity to find out what might be hampering the teams progress to the weekly goal. It creates the cadence the organisation needs to become a machine.
“Goals without routines are wishes; routines without goals are aimless. The most successful business leaders have a clear vision and the disciplines (routines) to make it a reality.”
― Verne Harnish, Scaling Up: How a Few Companies Make It…and Why the Rest Don’t
After communication, the other employee feedback I hear most often is a lack of praise and no culture of celebrating success. So, once you get to where you want to be, celebrate! How many times have you reached a goal at work and no-one seems bothered? Demoralising isn’t it. You’ve worked your butt off and no-one cares. It’s one thing a lot of companies aren’t good at: celebrating and saying thank you. Let’s go out and do just that once those goals are met. It also gives people something to look forward to, something to strive towards, and helps build interpersonal bonds within an organisation. And I’m not talking about this being an annual celebration, but perhaps weekly, monthly and quarterly!
Don’t expect overnight success. Be patient. If your objective is to increase your Net Promoter Score by X amount over the next year, and you’ve broken that down into quarter milestones, I’m afraid you’re not going to see a difference the next day. Or even the day after that. But you will get there. It’s about making sure everyone knows what they need to be doing, what their specific commitment to improvement is. Then hopefully this won’t happen:
“This is a little story about four people named Everybody, Somebody, Anybody, and Nobody. There was an important job to be done and Everybody was sure that Somebody would do it. Anybody could have done it, but Nobody did it. Somebody got angry about that because it was Everybody’s job. Everybody thought that Anybody could do it, but Nobody realized that Everybody wouldn’t do it. It ended up that Everybody blamed Somebody when Nobody did what Anybody could have done.”
― Verne Harnish, Scaling Up: How a Few Companies Make It…and Why the Rest Don’t
Written by certified Scaling Up Coach Dominic Monkhouse — founder of Monkhouse & Company. Found out more about his work here.