The Basic Tenets of Objective and Key Results Implementation
Objective and Key Results Implementation – to be able to effectively implement Objectives and Key Results (OKRs), it is important to understand how this whole process starts.
The following diagram demonstrates how your organisational vision is connected to every team and individual contributors in your team, from the annual down to the quarterly OKRs.
Short-Term Goals (done every year)
Objectives and Key Results (done every quarter)
Why Your Company Vision Matters
One of the reasons why OKRs are very popular these days is that they are focused on execution. A lot of other goal-setting framework help organisations define the “WHAT” but do not help answer the “HOW” which basically talks about how the objectives or goals will be achieved. But for the organisation to get started working on its goals, they should first determine the “WHY”.
It is essential for every team member to understand the purpose behind every company initiatives, processes, and actions. When a company is able to identify what they are doing, why they are doing it, and how they should execute their roles, they are able to achieve transparency. More importantly, they become truly aware of what success really is and how they can achieve it.
How to Define a Company Vision
As the leader who has to set your company OKRs, you will have to begin by thinking about the “end” in mind. Like how you see your company a few years from now.
The way you set your goals should be guided by what your company vision is. Your company vision must be easily stated in one sentence. It should describe what your organisation aspires to be. It’s basically your company’s ultimate dream – the end result of all your efforts.
Often, company vision statements are mistaken for a company tagline. While a vision can sound witty and unforgettable, it is meant for your team and culture. It is not meant to sell products. Thus, it is not needed that you create a vision statement that is appealing to everyone. Rather, it should be huge and ambitious.
Sure, it might take years for your organisation to achieve such vision. It is not easy, but it’s the driving force that pushes you and your employees to work hard each day.
How to Define a Company Mission Statement
Part of objective and key results implementation is defining the mission statement of the company. You might wonder – how does your vision translate into your mission statement? What is the difference between these two? Basically, your vision describes the end result of everything you do – your efforts.
But your mission statement lays out the reason for why your company exists. Your mission statement is where you plan how your products or services will take you to realise your company vision.
For a better view, let’s make Walt Disney Company as an example. Their vision statement is “TO MAKE PEOPLE HAPPY”.
But how will they be able to make people happy? Their mission answers the question. Their mission statement is to be the world’s leading producers and providers of entertainment. They will do it through their unique brand, content, services, consumer products, and innovative experiences.
When creating your company vision and mission statement, consider these tips and suggestions:
- Determine the things you are really passionate about. What do you envision yourself at the end of this journey? By answering this question, you should be able to start your vision statement.
- Think about your skills, experience, talent, and resources. Using these things, what can you contribute to the world?
- Next, determine the main economic denominator that is essential for your company. Understand what drives your economic engine.
How to Strategically Plan for Your OKRs
Creating your company vision and mission statement is one thing. Achieving them is another. Using the “Hedgehog Concept”, you can achieve your mission statement through the following ways:
- Focusing on what you are passionate about. This should help you really focus your efforts on developing a product or service that you want to offer to your target market. Strategies like market research can guide your company in identifying industry benchmarks and developing ways to ensure that your products fit your market.
- Focusing on what you do best. You also want to dig deeper into the current resources of your company. That includes the skills, knowledge, and experience of your employees. You have to know your organisation, so you will determine what it’s best at. It gives you an opportunity to establish efficient internal processes and strategies to achieve your company vision.
- It is also vital that you identify the economic metrics of your success. How much money should you have earned in order to say that you succeeded?
Many organisations make use of strategic planning systems that allow them to focus on the goals they set under each category. However, these tools are not made to replace OKR as your goal setting strategy. They should be considered as a “stepping stone” in your objective and key results implementation.
In some companies, annual goals are created through OKRs. It is a common practice to break down these annual OKRs further into quarterly OKRS to allow team members to focus on the execution. Take note that organisation OKRs are aspirations. In general, the key results of your company will show the main metrics that the leadership team supervises and held accountable for.
Nonetheless, many organisations commit the mistake of interchanging “tasks” with “key results”. Many people think that these two are just the same. However, they are not. Tasks are tasks – activities that employees have to do as part of their roles. Key results are indicators of success. Achieving them means achieving your objectives.
OKRs does not promote micromanaging of teams. It basically provides a framework that helps organisation determine what constitutes success, and what teams and individuals need to do to figure out how to get through their goals.
An important thing to remember when implementing objective and key results (OKRs) is that the high-level key results are assigned either to the CEO or the leadership team, or a specific department/team.
If OKRs are too narrow from the top, by the time they have been cascaded to the team members, individual contributors might end up having a to-do-list and not OKRs, and thus, will be less empowered to set their own goals.
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