How to Write Good OKRs

In our last post we covered what OKRs are. Now let’s dig into how to write good OKRs. There are a lot of resources out there on OKRs, but many are focused on outputs or metrics that aren’t outcomes or behavior changes. Remember, the idea behind OKRs is to shift from outputs to outcomes and focus on creating measurable changes in human behavior. This tells us if we’re working toward achieving our goals. If our Key Results are outputs or metrics alone, we will remain trapped in the feature-factory mentality with output-based measures of success.  

 

Write an OKRs objective  

Your Objective is where you want to go. To write a good Objective we need to start with the business problem that your product or team is trying to solve and what it would look like if you solve that problem. Think about what problem your product/project is trying to solve. What needs to be true for your product/project to be successful? What does success look like? How will you know you’re successful? This is your north star—it should be aspirational and qualitative—something your team wants to rally behind and it should be time boxed.

Let’s pretend for example that your company is an automotive manufacturer. You’ve seen a decline in people visiting showrooms and making in-person purchases since the pandemic hit, so the business has decided to invest more in e-commerce and digital-first selling capabilities. Your Objective might be: Become the leading automotive ecommerce seller by end of 2024. 

 

Key Results 

  • Key Results are measurable outcomes that tell you if you’re achieving your Objective. This is a different way of thinking for many teams, so before you jump into defining metrics, it’s important to think about the behavior changes that you’re trying to drive. If you achieve your Objective, what are people doing differently and whose behavior are you trying to change? In the automotive example, you’re trying to change the behavior of customers who would normally be visiting dealerships and buying a car in person. What would be the first signs of success if you solve the problem? What behavior changes would you see if more customers were buying cars online?

  • Track them consistently. Most businesses are tracking revenue, so your first inclination might be to write a key result around increasing revenue. That’s not wrong, but it will take a long time to find out if what you’re doing is successful. You should track revenue, but you can set that as a high-level business KPI or impact metric. Revenue is a lagging indicator.

  • Lagging indicators confirm long-term trends, so by the time you find out if you’ve increased revenue (or not), you’ve already invested a lot of time, money, and resources. Your Key Results should be changes in customer behavior, and its resulting business impact, which allows you to start thinking about small ways to move the needle and work toward achieving your Objective—these are leading indicators.  

  • In the automotive example, some behavior changes we might see would be customers asking questions or chatting with a sales rep online, customers booking a test drive online, customers looking at photos and videos online, customers referring their friends and families, customers feeling satisfied, customers making a vehicle purchase online.  

  • Next you can make the behavior changes quantifiable. Think about how and what you can measure. It’s important that you are able to track the metric you want to use before you include it in a Key Result. You will also want to limit your Key Results to 3-5 to avoid making it too complex to measure and track. If you are working on an existing product/project, you will also want to establish a start value/benchmark. This will help you set a realistic but ambitious target value for your Key Result. Once you’ve established your baseline metric, you can forecast 30-40% above what you think is possible. Ambitious Key Results challenge us to try new things. 

Here are some possible Key Results from our automotive example:  

  • 60% increase in orders placed online 

  • Reach 70 NPS score (industry average is 49, so this is pretty ambitious) 

  • 20% increase in leads generated online 

  • 20% increase in test drives booked online 

What’s next? 

Try our free OKR Ideation Mural template to help your team brainstorm OKRs. After you’ve defined and written your OKRs your team will have to figure out what initiatives will help drive those changes in behavior to make an impact for your customers and business. Initiatives could be features, projects, process/policy changes, or anything that will help you achieve your Key Results.  

Watch for our next post on how to adapt and operationalize the OKR process.  

Serene MirelesMB CollabOKRs