Wondering if your company is OKR ready?
How Tech Unicorns Establish Their Goals Through OKRs
OKRs—objective and key results—are an increasingly common strategy used by leading technology companies. The okr management framework is vastly credited by the founders of fast-growing startups, when asked about their culture and management practices. Nearly every founder will talk about company values, giving everyone the same trust circle or cactus tree certificate with a photo of them at their new hire happy hour as proof that they’re all friends now. But when we ask about more specific management practices, like how they measure employee performance or track business performance, most are reticent to share details. We’ll hear phrases like “It’s not something we reveal outside the company” and “it’s a trade secret” That being said, OKR management is one of the few management practices that almost every tech company is willing to discuss publicly and document as best practices for their employees. Not only are they widely adopted by technology leaders such as Google, Amazon, Intuit, Facebook, and Zynga but also by smaller growth stage companies like Percolate, UpCounsel, and Vidyard.
What are OKRs?
OKRs—objective and key results—are a small set of qualitative goals, each broken into an objective and a key result. This means that at the end of each quarter, each employee should have three concrete goals that they have agreed with their manager are critical to the success of the company. OKR management should be outcome-focused and not process-oriented. They should not be related to the day-to-day tasks of the job, but instead be focused on high-level, strategic objectives.
Why use OKRs to become a successful unicorn startup?
The core principle behind OKR management is that it encourages an employee to think more deeply about what they want to achieve and how they will measure success. This means that when an employee sets their OKRs, they are forced to dive deeper into their role and see what is genuinely core to their work (and therefore the success of the company) and what is more peripheral. And beyond this, companies that use OKR management are likely to see a host of other benefits, including improved company and team alignment: Because OKRs help employees to be more intentional about what success looks like, they can help to align the company toward a single, strategic direction. Improved employee engagement: Employees who are clear about how their work contributes to their company’s success are more likely to be engaged in their work. Increased productivity: There are several ways in which OKR management can help to boost productivity, including helping employees to better manage their time and setting clear expectations around what is expected of them. Better measurement and accountability: As employees know what they are being evaluated on, they can be held accountable for their results. Better communication: Because employees have clear goals, they can communicate more effectively with their managers and colleagues.
How to build an effective OKR process?
There are several important things to keep in mind as you work to build an effective OKR process:
- The framework – Framing your objectives and key results around the acronym
- The cadence – How often does your company meet?
- The format – What is the best format to present your OKRs?
- The follow-through – What happens after you set your OKRs?
Critical ingredients of a Unicorn
- Create a simple resolution to an existing problem
- Build a strong and highly commercial value proposal
- Create a plan in order to have a clarity of vision for the future of the organization
- Unicorn startups have Potential beta testers and customers
- They usually have an easy-to-use UX that qualifies users to quickly adjust and get the product.
Google’s Lead User Experience Engineer Tip: Keep Your OKRs Short and Sweet.
– Use a consistent framework – You and your team should use a consistent framework for creating your OKRs—whether it be the PROD framework, SMART goal setting, or another approach. – Focus on impact, not productivity – Productivity is not a useful way to think about performance. Instead, focus on impact—what do we need to achieve? What will success look like? – Be bold, but realistic – Be bold in your thinking, but realistic in your estimates. – Keep it short – Keep your presentation of your OKRs short, with no more than three to five goals per person.
Amazon’s Director of HR Tip: Use Objectives & Key Results to Make Culture a core part of your business.
– Make culture a core part of your business – Create a shared understanding of what success looks like across your organization. This could mean creating values and principles for your company or department as a starting point. – Tie your objectives to your strategy – Don’t just list goals, explain how they fit into your company’s strategic goals. – Create a culture of learning, not compliance – Make sure that your employees know that their performance is about growth, not compliance. – Use a consistent cadence – Pick a cadence for setting and reviewing objectives and key results and stick with it. – Use the same format – Make sure that you are using the same format for setting objectives and key results across your organization. – Communicate your process – Let your employees know which process you are using so that they can be involved.
How to create OKRs that will help in using the key ingredients of Unicorn to be successful in terms of growth?
OKR management follows two critical questions to be successful in terms of growth. These questions are:
a. What does your organization want to Achieve – Your Objective
b. How will your organization know that it has achieved it – Your Key Results
Now, every employee’s task is to find a way to execute these objectives to achieve outcomes that will lead to your achieving your key results.
How to best implement OKRs as Unicorn startups did?
a. Leadership agrees on annual OKRs for the company
b. Annual OKRs are communicated to the full team and sub-teams agree to quarterly OKRs
c. Once quarterly team OKRs are agreed upon, the teams start the cycle of execution
d. Closing the quarter and preparing for the next
OKR management is a proven way for employees to set clear goals and be held accountable for their results. As a leader, setting clear goals for your employees and being consistent with this process is extremely important. There’s no right or wrong way to set up your OKRs process. What’s important is that you follow a consistent format and that you’re consistent in setting and reviewing them with your team.
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