Accelerate your business growth with OKRs

  • Not directly contributing to the growth of the company?
  • Unquantifiable in their relation to growth?
  • Inefficient and of low impact?
  • Growth project prioritisation: Measurable growth-impacting projects are aligned and prioritised by all in your organisation.
  • Performance-based culture installation: Empowers your team to set measurable, ambitious growth-based goals.
  • Sustainable growth cycle creation: This leads to more cash being generated, which can be invested back into growing the business!
After you’ve read this article and installed OKRs in your business, operations will run like a dream!
  • OKRs origins
  • What are OKR’s in practice?
  • Why should my business use OKRs?
  • A step-by-step guide to the OKR process.
  • Tips on how to write OKRs.
  • OKR best practices.
  • 7 common OKR pitfalls to avoid.
  • A final note on optimizing OKRs.
The origins of OKRs

What are OKRs?

Here’s a basic example of how a few OKRs could look at the top of the organisation, where all who fall under the CEO in the senior team, either have a growth based, opex or earnings based OKR.

The power of OKRs

  • Transparency: Enables positive communication, collaboration and prioritisation between teams.
  • Ambition: They enable you to garner an ambitious performance culture.
  • Alignment: OKRs align people and teams around common strategic growth goals.
  • Measurable: They provide your business, teams and individuals with a measurable framework for tracking progress and success.
The OKR philopshy is unique.

A step-by-step guide to implementing OKRs

  1. Agree on OKR owners and train them!
  • Create a google spreadsheet: By far the easiest method is to create a Google spreadsheet similar to this one here, where all the owners’ OKRs will be housed. This works fine for smaller organisations where all the owners’ OKRs will be kept under one document/multiple tabs. At Vinted (a 120 employee company), we still use a Google spreadsheet and it works just great!
  • Buy an OKR tool: If you are a larger organisation then you might consider buying one of the many dedicated OKR SAAS options (e.g. http://okrsoftware.com/).
  • Build your own: At Google, they had built their own internal OKR tool which aligned with the rest of the internal HR system. I wouldn’t recommend this solution unless you are absolutely convinced that your company will work with OKRs in the long term as it’s obviously a complex and more costly solution. A leaner approach is to go with one of the other two options above.
  • Generate 2M in revenue from paid marketing
  • Achieve 12 month payback on all campaign activity
  • Acquire 40,000 customers with an AOV of €50.
  • Achieve average CPA per adoption of €100.

Tips on how to write OKRs

Objectives are where I want to go. Key results are how I will get there.
  • Your Objectives should be memorable qualitative descriptions of what you want to achieve. Objectives should be short, inspirational and engaging. They should also be ambitious and feel somewhat uncomfortable. They answer the question “Where do I want to go?”.
  • Your Key Results are a set of metrics that measure your progress towards an objective. Key Results are quantitative and measurable. They answer the question “How will I know I’m getting there?”.
  • When Key Results are directly related to fiscal results: In some businesses it may make sense to have two targets for each key result. At Vinted we set a 0.6 score and a 1.0 score. The 0.6 score is what you confidently think you can achieve (realistic) and the 1.0 is a more stretched goal. This approach enables us to think big, whilst at the same time helping us to improve the accuracy of financial forecasting, by aligning our model closer to the 0.6. Wherever possible we also break these key results down monthly, so that we can report on how we are delivering more frequently.
  • 1.0 — Stretch = Oct (+333k), Nov(+400k), Dec(+400k).
  • 0.6 — Confident = Oct (+232k), Nov(-235k), Dec(+8k).
  • Reduce open bugs count from 110 to 30
  • Reduce release time (after RC) from 6 work days to 3 work days

Some best practices to consider:

Nine common OKR pitfalls to avoid

  • Create key results which are measurable , growth-based goals: By far the most common mistake is to set key results which are not measurable and which do not impact on the businesses growth.
  • Avoid project-based key results: Try to avoid setting key results which are project-based. For example, ‘completing a strategy’ may lead to better business performance, but should not be considered to be either an objective or a key result as it can only really be measured in a binary fashion (complete/incomplete).
  • 3 is the magic number! Limit the number of OKRs to three or less. I often found that my best-performing, most impactful quarters at the Goog followed a well-thought-out, narrowly focused set of personal OKRs. More than 3 OKRs and you start to lose focus and impact.
  • Insufficient coverage: Regardless of who you choose to be OKR owners, ensure that there are OKR owners from across the business, at least at the manager level. Incomplete coverage leads to misalignment.
  • Inaccessible OKRs do not work: Whether you decide on a tool or a spreadsheet, ensure that each owner’s OKRs are accessible to everyone in the company. Not having a transparent and open reporting solution defeats the purpose of doing OKRs in the first place.
  • Build in a performance buffer: Build space between your business model and your OKR results, to encourage your teams to set ambitious OKRs. This will provide you with a degree of safety in terms of performance delivery when setting expectations with your investors.
  • Allow time for feedback: Ensure that there is time for feedback on the drafted OKRs. Don’t treat any OKRs drafts as final until you have received feedback from the broader organisation. You may find that the key results are too aggressive or too conservative, depending on what other teams can deliver.
  • Accountability is key: Avoid OKR owners sharing the same key results. Try to set accountable, independent key results rather than shared goals. If you share OKRs with other stakeholders, you’re liable to either not be able to prove your own impact, or worse still, underperform due to a reliance on others. Although OKRs should cascade under similar objectives from the top to the bottom of the organisation, be sure that they are not duplicated from one level to the next.
  • OKRs are not a golden bullet for strategic success: They should be considered an approach to optimise the operational direction, efficiency and outputs of the organisation when aligned with the strategy. For example, at Vinted we had implemented OKRs long before we saw the benefit. OKRs do not produce the required result in performance alone.
To elaborate on this point via a rather tenuous analogy; applying OKRs to a business with the wrong strategic direction is rather like playing the computer game “Lemmings” for the first time on the hardest level (Mayhem). Even if the Lemmings are all walking briskly in the same ‘strategic’ direction, inevitably the end result may tend to be the same.

A final note on the optimisation of OKRs

  • Broad educational documentation on the topic.
  • Make your management team the experts and advocates of the process.
  • Build OKRs as a key cornerstone of your performance culture.

--

--

--

Previously worked in Product Marketing at FB and Google. Helping people and businesses grow with purpose.

Love podcasts or audiobooks? Learn on the go with our new app.

Recommended from Medium

6 Inspiring Things We Can Learn from Self-Made Billionaires

How to Price SaaS Software: 3 Things That Influence Pricing Over Time

Company Spotlight — Viv For Your V

Avoid These 3 Common Mistakes When Using Metrics

A good sense of value

Startup Business Essentials.

College is the best time of your life, it is where you meet an array of people with different…

8 Simple Ways to Be Successful — from 8 Inspiring Leaders.

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Der Growth Guide

Der Growth Guide

Previously worked in Product Marketing at FB and Google. Helping people and businesses grow with purpose.

More from Medium

Will ESG increase my value?

BENEFITS OF MANAGEMENT STRATEGY PLATFORMS

Scaling Up with Processes and Tools

Proactive vs Reactive business strategy | Nuances to Know