OKR Planning for Your Business: How to Build a Strategy with the Right Goals
Objective Key Results (OKRs) are a management technique that was developed by Intel in the 1980s. It is a way to plan and measure a business strategy. This technique is used by startups and large corporations, such as Google, Tesla, Linkedin, and Dropbox etc.
The 3 main steps of OKR planning are:
- Set Goals
- Create Objectives
- Create Key Results
Set Goals: What do you want to achieve?
You start by thinking clearly and describing what you want to achieve within your organisation, where do you see yourself in 6 months, 12 months or a few years. Do you want to be market leader? what size or segment of the market do you want to win over.
The goals that you choose should be realistic, but ambitious at the same time, stretch yourself, your team and your organisation with your goals.
Create Objectives: How will you achieve these goals?
Start considering the milestones towards your objectives, how with you reach your main goal? Your objectives should be measurable and time bound. If for example your goal was to be a market leader in selling tomatoes, you could havemultiple objectives that will help you become a market leader. Perhaps you might want to get x% market share in 12 months - and if you achieve that, you are well within your way to achieving your goal.
Create Key Results: What are the specific milestones that will ensure the objectives will be successful?
Key results break down the objectives even further in to measurable small targets or metrics you can achieve within a smaller time frame. Back to our example, you could add a weekly sales target - eg. sell 1000 tomatoes per week in a certain geography, or onboard x clients every month.
The key here is to set clearly measurable goals, within very specific time frames.
Setting Objectives & Tracking Results
Objectives and goals can be set at different degrees: macro, intermediate, or micro.
Ideally, you want to start on the macro level - this is the high level, organisational vision, mission and direction. The macro goals and objectives will then be adapted down the organisation levels to the different departments and teams, so that everyone is working towards the same purpose.
Imagine a big boat, there is an engine room, the captain's view point and the workers around the boat. There is a leader - the captain of the ship who will give direction as to where the entire boat is headed. Everyone inside the boat, will end up at the same destination at the end of the day, but they all have different functionalities.
There is the look-out who stands at a high point in the boat, looking for obstacles in the water, if he spots something dangerious, he will signal the captain - who will steer the boat towards a different direction to avoid the obstacle. The workers in the engine room have to await instruction on when to speed up or slow down the boat, depending on the waters they are in - from the captain.
Setting the course
The captain starts by setting the goal, on the navigation maps and informing the crew where the boat is headed. Then the team start working on how best to get there, the speed the route to take, how to avoid storms and capitalise on the wind
Maintaining the course
Even with the plans set, the team is in constant lookout for obstacles and areas of improvement. The lookout only has to worry about making sure that the boat does not hit any obstacles, whereas the guy in the engine room only has to worry about making sure that there is always enought steam to drive the boat at the specified speed from the captain
Eveyone is working together, within their little areas - to achieve the common goal of the boat. OKRs need to be trickled down in the same way from the captain of your business or company. Once the high level objectives are set, each team must decide on their team and individual objectives to set the course for the trip and to maintain the course during the trip.
Example OKR Goals, Objectives and Key Results
Here are some example OKRs for a new business that just launched, selling sneakers in Johannesburg.
The high-level goals:
- Become preferred brand for young 14-18 year olds buying sneakers
- Make R1 million in monthly sales by next year
|Become preferred brand||50% maket share within the age group (14-18yr olds)||R500k monthly sales in that age group||Get a famous teen influencer to promote brand|
|R1 million in monthly sales||R 250k in weekly sales||Improve online store conversion to 15%||Re-work the landing page, add discount pop-ups|
These are some high level examples but you must note:
- You can have multiple key results for one objective
- You can have multiple tasks to complete to achieve one key-result
- You need to report frequently on your Key Results measures, track how you are doing against the target over time
Skhokho OKR tool - Regular tracking and reporting on the OKRs
This is where an OKR tool comes in, Skhokho OKR allows you set, track and report on your OKRs.
Setting OKRs with skhokho
Updating Key Results with Skhokho
Final result and tracking page