Using OKRs to Make Agile Transformation Work Better

At some point, all maturing teams find themselves in a situation where speed alone is no longer sufficient.

I saw this with many teams that began implementing agility, running sprints, managing backlogs, having stand-ups, and delivering work more often. However, despite all this motion, one thing often remains unclear: does this work really contribute to the success of the business?

It is then that the methods of working OKR agile come into play.

Agility allows teams to be adaptable and deliver work faster. OKRs allow them to be aligned and outcome-focused. This way, sales teams don’t end up being busy but not necessarily aligned.

This becomes relevant now because the agility that the teams implement should demonstrate its business value, not just speed.This is why agile vs OKR is not really a debate about choosing one method over another. It is a conversation about focus, alignment, and measurable execution.

What is the agile methodology?

Agile methodology is an approach that enables teams to work fast without giving up on learning and adapting.

Agile is, in my view, a practice that allows a team not to wait for months before knowing if their efforts are actually fruitful. In contrast to working in one big cycle, agile teams work in smaller parts, test ideas, receive feedback, and improve throughout the process.

The key principles of agile include collaboration, customer feedback, working software, and responsiveness to change. The most widely known agile framework, Scrum, also adheres to those principles by dividing work into sprints, conducting reviews, and improving continuously.

Agile can be especially beneficial for small businesses because plans may change, customers’ needs will change as well, and a small business has limited time and resources.

However, agility alone does not always provide a single answer to one important question: what outcomes should the team focus on? Here comes the importance of OKRs.

What are OKRs? 

Objectives and Key Results are OKRs. In my opinion, OKRs are a rather easy tool that helps teams determine priorities and key performance infdicators (KPI).

Objectives serve as the roadmap, and key results help to evaluate success. For instance, a team might want to increase the efficiency of the onboarding process by reducing onboarding time or increasing activation rate.

Initiatives are all about the things done in order to get desired results. For example, one can improve emails, include product walkthroughs, etc.

For a small business, OKRs provide clear priorities and alignment within a team. In an OKR agile setup, this clarity helps teams connect their sprint work with larger business goals. 

This is why OKRs fit in perfectly with agile, since agile provides a rhythm of execution, while OKRs provide a goal behind execution.

Agile and OKRs: Differences and similarities 

The most frequent error that occurs in practice is to view agile and OKRs as conflicting approaches to project management. Agile vs OKR sounds as if a team must choose either one or the other approach. Actually, each one solves a separate problem.

Agile concentrates on the delivery process. OKRs define the goal of delivery.

Distinct differences between Agile and OKRs

• Agile pertains to team processes

Agile allows teams to deliver faster and adjust to changes while improving themselves via feedback.

• OKRs pertain to team focus

OKRs allow teams to define their priorities, measure their progress, and align with 

overall business targets.

• Agile enhances execution

This is achieved through various methodologies, such as sprints, review, retrospection, and backlog management.

• OKRs enhance direction

They achieve this via objective setting, key result definition, check-ins, and progress evaluations.

Similarities between agile and OKRs

• Both emphasize focus

While agile makes the team focus on the most critical tasks at hand, OKRs make the team focus on the most critical business results.

• Both enable learning and growth

Learning for an agile team comes through feedback and reflection meetings, whereas for OKR teams, learning happens through review meetings and prioritization adjustments.

• Both require transparency

The team performs better with priorities, progress, blocks, and results being transparently available.

• Both are optimized with self-managed teams

Agile and OKRs become more effective where there is an empowered team making decisions, solving issues, and learning.

This combination works great for a small business because agility ensures flexibility in execution, while OKRs ensure that the speed has an impact on business results.

How do OKRs enhance agility?

Agile enables teams to operate faster, while OKRs ensure that speed is aimed at the right objectives. This is where the OKR agile approach becomes useful for teams that want speed with direction. OKRs ensure that the speed is aimed at the right objectives.

I see OKRs as an enhancement tool for agile, as they enable teams to focus better. Teams no longer have to take tasks just from the lengthy backlog; instead, they have to question themselves whether this task would help in achieving their key results.

The OKR framework enables better task prioritization. Once goals are measurable, it is easier to understand what needs to be done right away, what needs to be deferred, and what is not important enough.

Moreover, OKRs enhance the meaning of the agile process. Sprint completion, velocity, and delivery speed are good metrics, but they do not always reflect business impact. This is why agile vs OKR should be understood as a connection between delivery speed and measurable outcomes. 

With OKRs, teams pay more attention to such things as adoption rate, retention, revenue growth, quality improvement, customer satisfaction level, or cost savings.

Last but not least, OKRs enhance communication between people. Leaders and teams begin discussing not just task completion but changes made, knowledge acquired, and the contribution to business.

How do agile and OKRs work together in practice? 

The practice is that OKRs lead the quarter, whereas agile leads the sprint.

Take, for instance, a SaaS startup that sets up an OKR to boost product adoption among new customers. Key results could be about optimizing activation rates, decreasing time to first value, and improving onboarding completion.

Then the agile team works on testing and optimizing some particular aspects of the user journey during each sprint: onboarding checklist, product nudges, setup workflow or email sequence.

Sprint activities become linked with a broader business result. Backlog provides potential actions, sprint planning prioritizes relevant actions, and OKR check-ins show how much progress has been made towards the objective.

And this is when OKR agile implementation comes into play. Teams do not just deliver more work; they learn which work creates real value. Teams not only deliver more work but also learn what work delivers actual value.

What are the benefits of combining agile and OKRs? 

By combining the agile process and OKRs, teams will be provided with both speed and clarity. The agile method allows teams to execute their plans in sprints, and OKRs keep that execution tied to business objectives.

Focused backlog

Backlogs easily turn into an overloaded collection of customer requests, bug fixes, internal initiatives, and leadership needs. OKRs allow for smarter filtering of the backlog. 

Once key results are defined, the team can ask the question, “Does this piece of work contribute towards reaching the objective?” This will ensure the backlog contains valuable items.

Better business outcomes

While agile enables fast shipping of products, it doesn’t necessarily mean that teams are going to produce good business outcomes. By using OKRs, teams are encouraged to define metrics of how valuable their work was in terms of business impact.

Instead of counting the number of tasks completed, teams will measure adoption rate, retention, revenue, customer satisfaction, or costs saved.

More impactful meetings

OKRs make agile meetings more valuable. Sprint planning, review, and retrospectives become focused on OKRs. Discussions in such meetings change from “What have we done?” to “How did our work affect the system?”

Product iterations with measurable improvements

The Agile approach is based on continual improvement, and this improvement can be made measurable by OKRs. If, for instance, a team decides to improve a checkout process in several sprints, the OKR approach will help understand whether there was less cart abandonment or better payment completion.

Self-managed, strategic-minded teams

With the Agile method, teams have an opportunity to define the way work must be done. At the same time, with the OKRs approach, teams are clear about their goals. In this regard, teams are autonomous and aligned at the same time.

Tips for implementing OKRs during agile transformation 

Introducing OKRs as part of agile transformation should not complicate the process of work. It is about helping teams align agile execution with the measurable business priorities.

Engagement of responsible persons

At first, it is necessary to engage those responsible for outcomes. Founders, managers, team leads, product owners, department heads, or even managers dealing with customers will fit here. 

From my experience, OKRs worked better when those responsible for execution were involved, as they knew what is realistically achievable and what can prevent success.

Planning OKR introduction

At first, it is important not to introduce too many OKRs at once. Several clear company-level or team-level priorities that are relevant to current business needs would be good enough. 

The initial OKR cycle does not need to be flawless; it should help to learn to focus on priorities, measure, and improve.

Training of employees

OKRs seem to be rather straightforward, yet some assistance is needed to write them properly. Employees should understand the distinction between objectives, key results, and initiatives. 

The most effective way to do this is to use practical examples related to sprint planning, backlogs, and reviews.

Keep tracking and measuring OKRs consistently

OKRs shouldn’t be checked just once a quarter. You must know what is going well, what is not on track, and where help is needed. This will enable you to make good decisions while the job is being done.

Set up frequent OKR check-ins and reviews

OKR check-ins should be quick, crisp, and educational. Here, you may talk about the progress made, impediments, updates in data, and whether priorities need any change. In an agile team, this review can easily tie up with the sprint review or monthly business review.

Conclusion

The issue of agile vs OKR is not about choosing between the two. Agile makes sure that a team operates faster, whereas OKRs ensure that a team operates in the right direction.

As far as I am concerned, the true significance lies in the fact that the success of a team will be measured not just through accomplishment but through improvement.

JOP allows connecting OKRs, agile implementation, check-ins, review, and performance visibility within a single platform for better alignment towards outcomes.