What are OKRs?

OKR stands for objectives and key results. It’s a goal-setting methodology designed to push your team toward your biggest goals and help you monitor your progress in reaching them. 

Humor us while we give you a quick history lesson. The origin of OKRs is rooted in the “Management By Objectives” system that was founded by consultant and author, Peter Drucker.

Andrew Grove, the former CEO of Intel, then took the system and put it into a simpler form that answered two core questions:

• Where do I want to go?
• How will I pace myself to get there?

Having absorbed a lot of knowledge from Grove, an investor and venture capitalist named John Doerr presented this system to the co-founders of Google, who are frequently credited with popularizing OKRs. Since then, they’ve become commonplace in a lot of organizations – both small and large. 

Where do I want to go?
How will I pace myself to get there?

So, what’s an objective?

As the name indicates, OKRs are split into two main pieces: objectives and key results. Let’s talk about the objectives piece first.

To keep this simple, think of the objective as the goal that you’re setting. 

With your team, you’ll brainstorm objectives by asking, “What are the most important needles we need to move this quarter?” Yep, that’s a clue: OKRs are typically set on a quarterly basis.

Keep in mind that objectives should be high-level, qualitative statements that are aspirational – not tasks or granular outcomes.

EXAMPLE OBJECTIVE: Launch a new employee portal by the end of the quarter. 

And what about key results?

OKRs themselves might not be inherently measurable. That’s the job of your key results, measurable outcomes that indicate you’ve achieved your objective.

Don’t make the mistake of confusing key results with tasks and to-dos. This is about identifying outcomes, not things for your team to get done. So, make sure you’re that you’re always pointing back to a measurable result.

EXAMPLE KEY RESULT: Shipping the portal increases employee feedback scores by 25%.

Why use OKRs?

This isn’t a popularity contest. But, if it were, OKRs would be winning. You may have heard that tons of big-name companies – including Google, Netflix, Ahnheuser-Busch, Adobe, Samsung, and even us at Atlassian – use them for goal-setting. 

But, if name-dropping isn’t enough to convince you, there are plenty of other reasons to use OKRs, including:

• Greater alignment: Everyone is on the same page about goals and success indicators
• Improved flexibility: Since OKRs are set quarterly, those shorter goal cycles allow more wiggle room
• Boosted accountability: Everybody knows exactly how success will be measured and who is responsible for making it happen
• Increased focus: OKRs are thoughtful and well-defined, which boosts focus on the goals that really matter

With those awesome perks, it’s easy to see why OKRs are beloved by so many successful and rapidly growing organizations. 

How do you set OKRs?

You want to join the ranks of those teams and companies who are relentlessly pursuing their goals (because who wouldn’t?). Here’s how to go about it. 

Start by pulling together a brainstorming session with your team to identify what you most want to achieve. 

There’s probably going to be tons of ideas flying around, and likely some debate, about what your objectives should be. This is an instance where the more isn’t the merrier. We recommend distilling them down to no more than three to five objectives for the quarter. You’ll also want no more than three key results assigned to each objective so you don’t add confusion.

Also, keep in mind that OKRs are a better fit for loftier, longer-term goals. You’re not going to use this system to tackle one task on your daily to-do list or a team project that’s wrapping up tomorrow. That’d be way too cumbersome.

With those nuts and bolts in place, let’s briefly walk through the steps you and your team will follow to set OKRs. 

Step #1: Share the basics

If this is your first time using OKRs, a lot of this is going to be new to you and to your team members. Save some time at the start to teach your team about the process and terminology so that they’re able to constructively add to the conversation.

Step #2: Set your objectives

Now that everybody’s familiar with the basics, ask the team to brainstorm what big rocks you need to move in the quarter. (Try mind mapping!) Give everyone some time to write their ideas on sticky notes and stick them at the front of the room. When that’s done, group similar ideas together and have an open conversation to refine ideas and land on three to five objectives that are most worth focusing on right now. 

EXAMPLE OBJECTIVE: Create infographics for all blog posts.

Step #3: Identify your key results

You have your objectives, so now it’s time for the team to think about what results you would see and measure if you actually reached that goal. Those should be your key results. Remember, you don’t want more than three for each objective.

EXAMPLE KEY RESULT #1: Infographics improve the user’s time spent on page by 10%. 
EXAMPLE KEY RESULT #2: Infographics are pinned on Pinterest at least 100 times each.

Step #4: Check yourself

The groundwork is done, so now it’s time for a gut check. Look at the objectives and key results you’ve come up with. Are they unrealistic? Or are they too easy? Do you have too many? Or not enough? This is your chance to make some changes before finalizing those.

Step #5: Schedule your monthly checkpoints

Like any other goal-setting method, OKRs aren’t set it and forget it. You should be meeting with your team monthly to check in on how you’re tracking toward your objective by giving each key result a predicted end-of-quarter score. OKRs are scored on a sliding scale between 0 and 1 that indicates whether you missed, came close to, or hit your target for the key result. So, for example, if you’ve only improved the user’s average time spent on a single blog post by 3%, you’d score that key result at a 0.3.

How do you stick to your OKRs?

Whew! Your OKRs are set. The hard work is over, right? Not quite. Now you and your team actually need to stick to them. 

Here’s where that magic genie would really come in handy…

But just in case he’s a no-show, here are a few strategies you can use to increase buy-in and commitment to those goals:

• Involve your team in the process: If the above steps didn’t clue you in, setting your OKRs should be a collaborative process with your team. These goals shouldn’t be handed down from on high.
• Assign owners: Every key result should be assigned an owner, so that everybody knows who’s responsible for what. It adds clarity, while also boosting accountability.
• Don’t skip your check-in sessions: Things get busy, and you’d rather spend time working toward those goals than checking in on them. Resist that temptation! Those check-in sessions are important for proactively swerving around problems and monitoring your progress.
• Be patient: Your OKRs might not be perfect the first time. The good news is that you’ll set them quarterly, so you’ll refine the process before too long.