Objective and Key Results (OKRs) is another tool that acts as a measure and tracks results, specifically what is important, based on internal motivation. This is different from other tools that often use external motivation, such as Key Performance Indicators (KPIs) .
What are Objective and Key Results (OKRs)?
- Objective (O) is the goal.
- Key Results (KRs) are what we use to measure success, or key outcomes. They are indicators that show we have achieved our desired goals.
For example, if we want to develop our Time Management skills to increase our Productivity, we can use OKRs as follows:
Objective (O): Manage time and improve work efficiency.
- Key Result 1: Apply time management techniques or methods to your work (e.g. Pomodoro Technique or Time Blocking) to improve your work efficiency.
- Key Result 2: Reduce time spent on non-work related activities by 30%.
- Key Result 3: Execute and deliver at least 90% of the projects or key tasks on or before the deadline.
From the example, it can be seen that in order to achieve results in time management and improve work efficiency, we must first complete all Key Results.
How are OKRs different from KPIs?
1. Objectives and objectives:
- OKRs : Focus on setting ambitious, challenging goals and measurable key results to drive progress and achieve specific outcomes. OKRs are forward-looking and have goals that promote innovation, teamwork, and drive continuous improvement within the organization.
- KPIs : Focus on measuring the performance in specific areas that are important to achieving the organization’s goals. The purpose of KPIs is to provide an overview of how well the organization is performing in accordance with its strategic objectives.
2. Method of measurement:
- OKRs : Focus on qualitative and quantitative measurement, providing a more holistic view of performance. OKRs support the setting of ambitious, challenging goals to foster innovation and growth for both employees and the organization.
- KPIs : These are related to specific performance measures, and are usually quantitative, measuring performance against pre-defined benchmarks. KPIs are directly linked to performance indicators that are critical to the success of an organization.
3. Time frame:
- OKRs : These are conducted quarterly or annually, allowing for more flexibility and adaptability in goal setting. OKRs can be developed, modified, and changed more frequently, adapting to changes based on the organization’s priorities and strategies.
- KPIs : Often have a clear time frame, focusing on immediate or short-term performance goals and indicators to reflect ongoing operational performance.
4. Collaboration:
- OKRs : Great for aligning individual, team, and organizational goals with broader strategic objectives, OKRs promote collaboration by encouraging teams to work together towards shared objectives and key outcomes.
- KPIs : Used to align teams with overarching organizational goals, to ensure everyone is working toward the same outcome. While KPIs promote collaboration, it is common to see teams become more focused on achieving their own or the team’s results than the bigger picture.
5. Flexibility and adaptability:
- OKRs : Designed to be flexible, allowing the team to adapt to changing circumstances, encouraging continuous learning and improvement throughout the process.
- KPIs : May be less flexible, with an emphasis on continuity and consistency. Although KPIs can be changed, they tend to be more fixed in their framework and are not often revised during the year or interim.
When or where should we not use OKRs?
1. Routine and repetitive tasks : Avoid using OKRs when dealing with routine tasks that require standard operating procedures or clear steps. The reason is that OKRs are most effective when used with challenging goals that are not repetitive tasks.
2. Short-term projects : Avoid using OKRs when working on short-term projects with clear and specific outcomes. The reason is that OKRs have the most positive impact on long-term projects, and using OKRs for short-term projects can be overly complex and overwhelming.
3. Lack of leadership commitment : Avoid using OKRs when an organization lacks leadership commitment to a goal-setting culture. The reason is that successful OKR implementation requires leadership buy-in and commitment to the principles of transparency and adaptability.
4. Poor communication culture in the organization : Avoid using OKRs when the organization lacks open communication and effective collaboration within the organization. The reason is that OKRs require transparent communication, and if there is no culture that supports this, the effectiveness of communication will decrease and OKRs will be useless.
5. Highly Stable Work Environments : Avoid using OKRs when working in a highly stable environment where goals and priorities rarely change. The reason is that for OKRs to be successful, an organization must be dynamic, and using OKRs in a stable environment can be unnecessarily complex.
Conclusion
In summary, OKRs are a useful tool for organizations that aim for ambitious, challenging goals and require the ability to adapt. However, their effectiveness or desired results will depend on the context of the organization and its commitment to fostering a culture that embraces transparency, collaboration and continuous improvement.
Considering your goals and organizational culture is important when deciding when to use OKRs and when to explore alternative approaches to using other tools.
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Free e-Book “OKRs Made Easy – A Practical Guide for Work Success”
OKR Setting Guide and Examples There are over 100 examples to choose from.
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