Everything a Founder Should Know About Writing Effective OKRs for Their Startup

Two decades ago, a small startup called Google, received one of its first significant investments. Venture capitalist John Doerr invested $11.8 million for 12% of the company. 

But it wasn’t just money that Doerr offered to the two co-founders Sergey Brin and Larry Page. Doerr shared a piece of wisdom that later became an integral part of Google’s work culture. Fast forward billions of dollars, and twenty years later, it is fair to say that Google is one of the biggest success stories in the Silicon Valley.

The billion-dollar advice Doerr gave to Lary and Sergey was to implement OKRs as their main organizing principle. Soon after, the word got out that Google was using OKRs. The startups from all over the world adopted it, as well. Their goal was simple, obtain Google-like performance by implementing the Objectives and Key Results (OKRs) management tool.

What are OKRs?

OKRs stands for Objectives and Key Results, and after Google implemented it, it was widely accepted as one of the best management tools worldwide.

 With that behind us, it is time to learn a thing or two about this method of pushing your team and yourself toward accomplishing the biggest possible goals while monitoring the progress in reaching them. The entire system revolves around answering two simple yet fundamental questions. One is “Where do I want to go?” The second one is “How will I pace myself to get there?”

One can comprehend OKRs through their two main pieces: objectives and key results. Let’s start with the objectives first.

Objectives

In simple terms, the objective is the same thing as the goal you’ve set for yourself or your team. For example, while you are at a brainstorming session with your team, you ask, “what are the most important milestones we need to hit this quarter?” And yes, it’s one objective, milestone, goal, or whatever term you want to use per quarter.

At the same time, understand that an objective is a qualitative statement and not some minor task.

Key Results

Key results are all about identifying outcomes. They need to reveal whether you’ve accomplished your objective or not. Key results do not need to be confused with to-dos or tasks. Therefore, you need to be always sure that you end up with a measurable result.

Here is a simple example to help you better understand the process:

What do you want to achieve?

The answer is your objective. Your objective needs to be clear as a destination, like London or some other place you want to get to. 

For example:

• Increase your last quarter’s earning
• Improve the customer experience
• Increase productivity of your startup

How will you know you’ve achieved that?

The answer to this is Key Results. Think of it as a GPS device or some pointers that let you know if you are getting closer to achieving your objective.

For example:

• Sell $1 million units
• NPS at 85

You will also need to figure out the initiatives you will need to reach your Key Results. That includes a list of projects and tasks necessary to get there. For example:

•  Introduce a new marketing strategy to boost sales
  
• Add more people to the customer support team and improve the training of everyone working there.

Common OKRs Mistakes

If you are new in the world of OKRs, then it doesn’t take too much to get confused and make a mistake, especially if you are a fast-growing startup. To avoid that, it is best to learn from other people’s mistakes. To that end, here’s a list of some of the most common OKRs mistakes. 

OKR Mistake #1 Low-value objectives

This is a rookie mistake, and it happens quite often to those new to OKRs. Completing low-value objectives means that even if they are perfectly completed, their impact would be practically invisible. When that happens, not many people would care or notice.

OKR Mistake #2 Objectives not challenging enough or too challenging

Objectives need to be ambitious but not too challenging to accomplish. If the team manages to accomplish 100% of the objectives every time, perhaps then it is because the bar is too low. Typically, 70 to 80% of objectives are completed per quarter. Less or more than that, and you probably need to re-evaluate your OKRs and make your managers perform better.

OKR Mistake #3 – unmeasurable objectives & key results

Both objectives and key results need to be numeric. That way, you can evaluate your and your team’s progress. Failing to do so means sinking your productivity. 

OKR Mistake #4 – accountability

“You are as strong as your weakest link” is a popular saying that also happens to hold significant meaning in the world of OKRs. Each member of your team needs to be held accountable for their progress or the lack of it.

OKR Mistake #5 – set and forget

OKRs need to be discussed regularly-like every week. You need to make a ritual out of it and review progress weekly with anyone involved. Otherwise, you can discover that you are not even close to reaching your results when the quarter is over.

Conclusion

As Albert Einstein said, “Everything should be made as simple as possible, but no simpler.” He was one of the smartest men that ever walked the earth. This is the perfect quote to describe the OKRs management tool. Writing OKRs needs not be a super complicated task, and you need to approach it like that. Once you get the hang of it, you will be able to implement it in your organization right away, without any massive preparations or restructuring.

The best part of all, the OKRs methodology is that it works on all levels, from high management to the guys and girls working in the mailroom. OKRs will work even if you are a promising startup with just a few guys working in a garage turned office. 

And if you have any doubts, remember that it worked for the Google guys. It got them on top of the world and made them filthy rich in the process. 

So, don’t dwell for too long and instead roll up your sleeves up and get to work! About AbstractOps

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References: https://www.whatmatters.com/