Goal Setting for Teams: A Practical Guide to OKRs
Have you ever wondered how some teams seem to always crush their goals while others struggle to gain any real traction? As someone who has led both highly effective and not-so-effective teams, I can tell you the secret sauce is all in how you set objectives and key results or OKRs. When done right, OKRs energize teams and provide the focus and alignment needed to achieve amazing results. In this article, I’m going to walk you through a practical framework for setting team OKRs to supercharge your productivity and success. Whether you’re a team of 5 or 50, OKRs can help get everyone on the same page and rowing in the same direction. By the end, you’ll have the tools and insights you need to set inspiring yet realistic goals as a team and start achieving at a whole new level. Sound good? Then let’s dive in!
What Are OKRs?
What Are OKRs?
Objectives and Key Results or OKRs are a goal setting framework used by teams and companies to set priorities and track progress. OKRs stand for:
Objectives: Broad goals that are meaningful, actionable, and ambitious. They should motivate and challenge the team. For example, “Improve customer satisfaction” or “Increase monthly recurring revenue.”
Key Results: Concrete and measurable milestones that progress towards the objective. They make objectives actionable and help determine if the objective was achieved. For example, “Increase net promoter score from 50 to 60” or “Add 10 new enterprise customers.”
The key benefits of OKRs are:
- Alignment: OKRs align teams around common goals so everyone is working together towards key priorities.
- Focus: With clear objectives and measurable key results, teams can focus their efforts on what really matters. This avoids distractions and spreads resources and time efficiently.
- Tracking progress: OKRs make progress transparent so teams know if they’re on track and can make adjustments as needed. Regular check-ins are important for accountability and to evaluate if key results need modification.
- Stretch goals: OKRs encourage ambitious goals that push teams outside their comfort zone. When done right, about 60-70% of key results should be achieved. This motivates continuous improvement.
- Autonomy: While OKRs provide alignment and accountability, they still give teams flexibility and autonomy to determine how key results will be achieved. Creativity and innovation are encouraged.
OKRs take work to implement successfully but the benefits to team focus, alignment, and performance can be well worth the effort. When used consistently over time, OKRs become second nature and a simple but powerful tool for progress.
The Benefits of Using OKRs for Teams
When teams use OKRs, it leads to better alignment, focus and accountability.
OKRs help get everyone on the same page about key priorities and how they ladder up to company goals. You’ll avoid wasted effort from teams working at cross purposes or duplicating work. With transparency into each other’s objectives, teams can identify dependencies and synergies to better collaborate.
Teams struggle with focus and can easily get distracted by “bright, shiny objects.” OKRs provide guardrails to keep teams centered on what really matters. They can rally the team around measurable, time-bound outcomes that lead to key results. This focus and clarity help teams avoid scope creep and “boiling the ocean.”
OKRs introduce a cadence of planning, checking in on progress, and grading outcomes that fosters accountability. Teams make a plan, see it through, and determine what’s working and not working. This accountability helps teams achieve more by keeping them on track and pushing them outside their comfort zone. Teams that achieve most of their OKRs build confidence and motivation to set their sights even higher next quarter.
By aligning teams, maintaining focus, and building accountability, OKRs can transform the way teams work together. OKRs lead to higher performance, greater job satisfaction, and a team culture where innovation and risk-taking are the norm. What team wouldn’t benefit from that?
How to Set Impactful OKRs
How to Set Impactful OKRs
Setting meaningful objectives and key results (OKRs) for your team is key to success. The OKR framework helps provide purpose and guidance, keeping everyone aligned while allowing for flexibility. When done right, OKRs can motivate your team and lead to real impact.
Start with your team’s vision. What do you ultimately want to achieve? Then determine 2-5 high-level objectives that will move you closer to that vision over the next quarter. For each objective, define 3-5 key results that will serve as concrete milestones. Key results should be specific and measurable, using numbers whenever possible.
For example, if your objective is “Delight more customers,” key results could be:
- Increase Net Promoter Score from 50 to 60
- Decrease customer complaints by 25% from Q1
- Achieve 80%+ satisfaction rating in post-purchase surveys
Review your OKRs regularly in one-on-one meetings and team check-ins. See what’s working and not, then make adjustments as needed. Be willing to drop or change OKRs if priorities shift. The key is to maintain focus while also being flexible.
To keep your team engaged, share progress updates and celebrate wins, big or small. For key results, consider assigning ownership to individuals or sub-teams. This gives people a sense of purpose and motivation to push forward.
At the end of the quarter, evaluate how you did against your OKRs. Some key questions to ask:
- Did we achieve our objectives? If not, why?
- What key results were met? Which fell short?
- What did we learn? How can we improve for next quarter?
- Should any objectives or key results be adjusted going forward?
The OKR cycle then repeats, building upon your progress and lessons from the previous quarter. With regular practice, setting impactful OKRs for your team can become second nature.
Best Practices for Writing OKRs
The key to successful OKR setting is following some best practices. Here are some tips to keep in mind:
Start at the top
Have your leadership team set OKRs first. Then cascade them down to departments and teams. Make sure individual OKRs ladder up to support higher-level company goals. Starting from the top down helps ensure alignment and that everyone is working towards the same vision.
Keep it focused
Limit yourself to 3 to 5 OKRs per quarter for each team or department. Any more than that and you risk losing focus and spreading yourself too thin. OKRs should be ambitious yet realistic.
Define key results
For each objective, determine 2 to 3 key results that will measure progress. Key results should be specific, time-bound, and quantifiable. Ask yourself, “What will we need to achieve in the next quarter to accomplish this objective?” Then define those milestones as key results.
Grade with scores
Score each key result on a scale from 0 to 1. 0 means no progress, 1 means fully achieved. Scores in between, like 0.7, show good progress. Tally the scores for each OKR to determine if it was achieved (1.0), partially achieved (0.7-0.9), or not achieved (less than 0.7). Use the scores to see where to improve and refocus efforts.
Review and revise
Meet regularly as a team to review OKR progress and make adjustments as needed. It’s common for priorities to change from quarter to quarter. You may need to revise or replace an OKR to account for new projects or roadblocks. The key is to learn from each cycle and improve the process over time.
Following these best practices will help your team develop a cadence of planning, executing, measuring, and improving using OKRs. Be patient through the learning process and make changes gradually. With regular practice, OKR setting can become second nature.
Aligning Individual and Team OKRs
Aligning individual and team OKRs ensures everyone is working together towards the same goals. As a team leader, it’s your job to make sure each person’s objectives ladder up to the team’s key results.
Connect the dots
Explain how each person’s OKRs contribute to the team’s success. For example, if your team’s goal is to increase customer satisfaction by 20%, individual OKRs might focus on decreasing customer wait times, improving product quality, and streamlining the returns process. Connecting these individual objectives to the overall team goal helps people understand why their work matters.
Look for alignment
Review each team member’s OKRs to ensure they complement each other. If you notice overlap or redundancy between people’s objectives, make adjustments to spread out the work and clarify responsibilities. On the other hand, if there are any gaps in the OKRs that could impact achieving the team’s key results, work with individuals to establish additional objectives to address those gaps.
Meet with each team member to discuss their OKRs and how they align with the team’s goals. Offer constructive feedback and guidance on how to strengthen that alignment. Be open to feedback on the team’s OKRs as well, in case any adjustments need to be made to support individuals in accomplishing their objectives.
Track progress together
During regular check-ins, review progress on both individual and team OKRs. Celebrate wins and milestones together, and make a plan to address any barriers or roadblocks. Re-aligning OKRs may be needed if priorities or strategies change. The key is to continuously monitor how individual and team goals are supporting each other.
Keeping individual and team OKRs in sync is an ongoing process. With regular communication and a commitment to shared success, you can achieve remarkable results through aligned objectives and a collaborative team effort. Focusing on the connections between people’s work and the team’s priorities will inspire and motivate your team to accomplish great things together.
Tracking Progress and Measuring OKRs
Tracking your OKRs is critical to staying on course and achieving your goals. As a team, you’ll want to measure progress regularly and make adjustments as needed to ensure you cross the finish line.
Schedule recurring meetings, such as biweekly or monthly, to discuss the progress of your OKRs. Review key metrics and milestones for each objective to determine if you’re on track or need to make changes. Be open and honest about any barriers preventing progress. Work together as a team to find solutions and get back on track.
Key Performance Indicators (KPIs)
For each objective, identify 2-3 key performance indicators (KPIs) to monitor progress. These should be specific and measurable numbers that directly relate to your goal, such as:
- Number of new customers acquired
- Revenue from new products
- Customer satisfaction scores
- Time required to complete key processes
Review your KPIs regularly in your check-in meetings and make adjustments as needed to targets or key activities to ensure you achieve your OKRs.
As with any goal, obstacles will arise that threaten to derail your progress. Discuss openly any barriers the team is facing in your check-in meetings. Work together to find solutions to overcome them, such as:
- Securing additional resources or funding
- Adjusting deadlines or activities
- Improving processes or communication
- Providing extra training or support for team members
The key is addressing issues quickly and as a team. Make a plan to get back on track and avoid future obstacles. With regular progress monitoring and obstacle management, your team will achieve its OKRs and ultimately its key objectives. Stay focused on your goals and support each other along the journey. You’ve got this!
Common Pitfalls to Avoid With OKRs
When implementing OKRs, it’s easy to make mistakes that undermine their effectiveness. Be aware of these common pitfalls to avoid:
Not Aligning With Company Goals
The objectives you set should map clearly back to the key priorities and initiatives of your organization. If teams are working towards goals that aren’t tied to the company’s key results, it can lead to misalignment and wasted effort. Make sure managers and executives review and approve team OKRs to ensure proper alignment.
Too Many Objectives
It’s better to focus on a few key objectives than try to accomplish too many goals at once. As a rule of thumb, most teams should have 3 to 5 high-level objectives each quarter. Any more than that and your efforts can become diluted and teams may struggle to make progress on all fronts.
Not Cascading Properly
OKRs should cascade down from the company level to departments to teams to individuals. Higher-level OKRs should link to more specific key results and objectives at lower levels. When cascading is done incorrectly, teams won’t understand how their work contributes to organizational priorities. Spend time mapping out how objectives at each level relate to the goals above them.
Key Results That Aren’t Measurable
Choose key results that are specific and quantitative so you can easily determine if you’ve achieved them. “Improve customer satisfaction” is not a measurable key result. “Increase customer satisfaction survey scores from 4.2 to 4.5” is a measurable target. Measurable key results are essential for accountability and transparency.
Not Revisiting Regularly
The only way to keep OKRs effective is to revisit them frequently. Teams should check in on progress each week and make adjustments as needed. You should also evaluate key results at the end of each quarter to determine if objectives were met and plan new OKRs for the next quarter. Regular follow-ups and reevaluations help to keep teams on track and make OKRs an ongoing cycle of progress.
Following these best practices will set your team up for success with OKRs. With time and practice, avoiding these common mistakes will become second nature and OKRs will become an integral part of your team’s workflow.
Software Tools for Managing OKRs
To effectively implement OKRs, the right software tools can make a big difference. Here are some options to consider:
If you’re on a tight budget, Google Sheets is a simple solution. You can create a spreadsheet to track your OKRs, key results, and progress updates. The downside is that as your OKR program scales, spreadsheets can become cumbersome to manage and update. But for small teams just getting started, Sheets is an easy, free tool.
ZumoDrive is another free, open-source software tailored for OKR management. It has features like automated progress updates, the ability to link key results to tasks, and reminders to keep teams on track. The simple interface makes it relatively easy to adopt. For small to mid-sized teams, ZumoDrive can be a good fit if you want more functionality than a basic spreadsheet.
7Geese is a well-known paid software for implementing OKRs and performance management. It offers advanced functionality like the ability to cascade OKRs down through an organization, rich reporting and analytics to gain insight into progress, and integration with tools like Slack, Jira, and BambooHR. The cost is around $50 per employee per year. For large organizations scaling OKRs, 7Geese is a powerful solution, though the price tag may be prohibitive for some.
Like 7Geese, Perdoo is robust, paid enterprise software for managing objectives and key results. It provides many of the same benefits like alignment across departments, automated progress updates, and advanced analytics. Perdoo integrates with popular workplace tools and starts around $30 per employee monthly. For big companies, Perdoo is worth considering if you want an all-in-one solution to implement OKRs at scale.
The options for OKR software keep growing. Evaluate a few based on your team size, budget, and needs. And remember, while tools can help, the most important factor for success with OKRs is building a culture where people are engaged with and committed to their objectives and key results.
FAQ on Implementing OKRs for Your Team
Once you’ve set OKRs for your team, you’ll likely have some questions about implementing them. Here are some of the most frequently asked questions and answers to help you through the process.
How often should we review our OKRs?
It’s a good idea to review your team’s OKRs regularly to make sure everyone is on track. Check in at least once a month, if not biweekly. Discuss what’s working, what’s not, and whether any OKRs need to be adjusted or reprioritized. These reviews, known as “check-ins,” help keep your team accountable and aligned.
What if we need to make changes to an OKR mid-cycle?
Don’t hesitate to adapt your OKRs as needed. OKRs should be flexible enough to accommodate changes in priorities or unforeseen circumstances. If an OKR is no longer relevant or needs to be refocused, work with your team to revise or replace it. The key is to make sure any changes are clearly communicated and everyone understands the rationale behind them.
How should we track progress on our OKRs?
Use a shared OKR tracking tool, spreadsheet, or project management software where your whole team can see the status and progress of each OKR. Record key milestones and metrics, note any blockers or issues, and regularly update progress bars or percentages complete. Tracking progress in a transparent way keeps your team motivated and accountable.
What happens if we don’t achieve an OKR?
It’s not uncommon for teams to miss an OKR target occasionally. The most important thing is that you learn from it. Analyze why you fell short and look for ways to improve next cycle. Maybe the OKR wasn’t realistic or meaningful enough. Maybe unforeseen obstacles got in the way. Use what you learn to set better OKRs next time around. While achieving your OKRs is ideal, the real goal is to progress and continuously improve.
If you follow these tips for reviewing, revising, tracking, and learning from your OKRs, your team will be well on its way to mastering objective setting and achieving great results. Let me know if you have any other questions!
So there you have it – a practical guide to implementing OKRs for your team. While it will take an investment of time and effort to get it right, the benefits to your team’s productivity and sense of purpose will be well worth it. OKRs provide the perfect framework for setting ambitious yet realistic goals and keeping your team aligned and accountable. If done well, OKRs can be a game changer. The key is to start simple, learn as you go, and make adjustments based on what works for your unique team dynamics and needs. With the right mindset and consistent practice, OKRs will soon become second nature. You’ll be achieving more, improving faster, and celebrating many wins along the way. So what are you waiting for? Get started today and take your team to the next level!