What are OKRs and Why are They Important?
You’ve probably heard a lot of talk in recent years about shifting from outputs to outcomes. The Objective and Key Result (OKR) framework focuses on outcomes, which are measurable changes in human behavior. Focusing on outcomes drives you to continuously measure and learn. The OKR framework helps teams move from strategy to execution by bringing teams together to work toward achieving a common goal. OKRs help shift our conversations and decisions. When teams work toward achieving a common objective and learn through feedback, our key results can tell us if what we’re doing is making an impact.
Why are OKRs important?
Have you ever wondered if the features that your team spent time, money, and resources building were the right things? If you look at your product roadmap, how confident are you that you’re delivering value and making an impact for your customers and business? If you’re unsure, you’re not alone. Many teams struggle to deliver value. They constantly ship new features without knowing if it made any difference. They move from idea to solution without research, testing, or strategy—they don’t have time—they have a release date to hit!
After teams launch a feature, they move on to the next thing to hit their next release date. The problem with this approach is that your team ends up spending time, money, and resources on ideas that didn’t make an impact. Your team ends up doing work that might not need to be done. No one wants to spend time on meaningless work. This way of working makes it difficult to know if you’re creating value for customers and your business. By the time we realize the new features haven’t made any impact, it’s too late. We’ve built it, shipped it, and scaled it.
What are OKRs goals?
Your objective is where you want to go. Think about the business problem that your product or team is trying to solve and what it would look like if you solved that problem. What needs to be true for your product/project to be successful? What does success look like? This is your north star—it should be aspirational and qualitative—something your team wants to rally behind, and it should be time boxed.
Key results are measurable outcomes that tell you if you’re achieving your objective. Reminder, outcomes are a change in HUMAN behavior. This is where we see a lot of teams getting OKRs wrong—their key results are solution or output focused.
It’s also important that you are able to track the metric you want to use, otherwise you risk making it too complex and won’t be able to see progress. Key results should be ambitious but achievable—this will challenge you to try new things and unlock creative thinking.
After you have objectives and key results defined, you can start to work on the initiatives or solutions that will help achieve your OKRs. These could be features, process changes, policy changes—anything that will help you achieve your key results.
Benefits of OKRs
When we all work toward achieving a common objective, our key results are the leading indicators that can tell us earlier on if what we’re doing is making an impact. We can conduct research to discover opportunities and test different solutions to give us confidence that our ideas are going to deliver value. Instead of shipping features and moving to the next item in the backlog, we have to measure to see whether what we shipped changed customer behavior in the way our key results predicted. If it didn’t, we iterate or change course and try something different. This allows us to reduce risk, be more agile, and become more customer centric.
Check out our next post—How to write good OKRs.