The global pandemic of 2020 has shown us that careful long-term planning efforts can end in frustration and nonfulfillment. However, that doesn’t mean long-term goals are not critical.
As a startup, you have a vision (the ultimate destination), so all your current efforts tie together for the bigger picture.
Business annual goals are important, but breaking these goals into small focus areas is an excellent agile strategy. The shift towards agile goals can be time-consuming and challenging because it requires adopting changes to your culture and performance management, according to 59% of business professionals.
To achieve agile goal setting and empower your business team to move towards your preferred organization metric, consider using the objectives and key results (OKRs) goal-setting framework.
Here, we help you learn everything about the OKR method and OKR coaching, how OKR software set you up for success, and the best software on the market.
Let’s dive in.
What Are OKRs?
OKRs are Objectives and Key Results, which help teams set and track measurable goals. The method helps create OKR templates that are immensely flexible so they bend and bow to fit all purposes of project management.
So, it’s “I will [Objective] as measured by [Key Result].”
The Objective is a goal you’re working towards, including increasing brand awareness or even creating the lowest carbon footprint in your industry. We use the objective to set a clear direction to where we want to go - OKR progress.
The Key Result measures your progress towards the objective, such as ensuring a quarter of your item’s material is compostable or driving a million web views, even improving employee experience. Think of the key result as a signpost with a distance marker.
Initiatives are tasks or projects that’ll help you achieve the key results. The initiatives are descriptions of what you do to get to a destination.
The methodology involves applying several rules that help employees align, prioritize, and measure the outcome of efforts. OKR helps organizations and small businesses create a connection between strategy and execution while moving an output-based to an outcome-based approach.
Things To Look For In OKR Software
The most popular tool is the spreadsheet for many startups making their first entry into OKRs. However, business growth means your once-clear alignment quickly descends into an unreliable tangle.
Like the OKR methodology, OKR software is a means to achieving an end. The software will help employees track progress easily and improve task management.
But there are too many options available on the market, making it difficult for a business to choose one for their management system. Here are five things to look out for in OKR software before investing in one.
Flexible And Customizable
The best and most high-performing OKR software supports easy customization and is flexible. You can check the OKRs or goals as milestones, quantities, or percentages.
Look for software that offers the flexibility to check in on your OKRs as per your requirements. Plus, the software will become an invaluable tool in the long run.
Cascades And Aligns
OKR software should have basic functionality for aligning and cascading simple OKRs. Remember, OKRs and goals are a shared responsibility.
Cascading the OKRs allows sharing goals from one organizational level to the next, improving the general roadmap. For instance, the manager may cascade their goals down to direct reports.
Aligning the OKRs helps everyone visualize your organization’s bigger picture. Individuals can align their goals with the business.
For instance, your primary goal is to break into an untapped market. Aligning the OKRs will show employees how their efforts contribute towards a specific goal.
Easy And Simple To Use
Users should understand how the OKR software works with little to no training during onboarding. Choose a tool with a clean and uncluttered user interface.
The simpler and more user-friendly the OKR software, the easier it is for everyone. Understanding and using the software shouldn’t be a new project for all employees.
Plus, make sure it offers easy integration with other processes or OKR tools. The software adoption rate increases depending on its user-friendliness.
Adding comments allows employees and managers to discuss important business components. This functionality promotes two-way communication and teamwork while setting a healthy workflow culture and regular feedback.
Actionable dashboards and insights make understanding and analysis simple. Plus, check whether it indicates completion percentage, highlights goals, aligns goals, and status.
Dashboards and insights help employees see whether a goal requires more attention. The dashboard also helps everyone stay focused and aligned.
Enables OKRs Visibility
The main reason for having OKR software is to increase the visibility of your OKRs. So, you’re not digging for information from multiple tools. Instead, you have a central place for creating, visualizing, storing, and tracking OKRs all in one.
Between documentation tools, time feedback, Jira, execution tools, Slack, Microsoft teams, and email, teams in your organization have multiple places to check for information. Introducing a separate OKR software to the mix adds a new place where your information dies.
The best OKR software works with other business tools such as Salesforce and Asana or is a feature included in the main execution tool.
Bi-Directional Goal Setting
A significant benefit of the OKR framework is alignment from top to bottom and across the organization. Such alignment is only possible when setting goals is bi-directional. So, leaders set goals for their teams, and teams can share their goals with the leaders.
Bi-directional goal management setting helps create autonomy across your venture. As a leader, you show teams where to go while letting them determine how they’ll get there, allowing them to balance between short- and long-term strategies.
Shows A Clear Sight Of All Connected Work
Goal alignment during the planning phase is excellent, but staying on course is another thing. The right tool makes it possible to maintain the desired alignment for your long-, mid-, and short-term company objectives.
The best software shows the connection between objectives and how they work together across the organization. You see the relationships between work items and each connected objective, so leaders and their teams have an obvious line of sight of the connected work.
Shows Shared Objectives And Interdependencies
Bi-directional visibility is critical for aligning your teams with long-term strategic goals. However, horizontal synchronization is vital, especially for teams working closely together, sharing resources, or with shared objectives.
As you set OKRs, teams should focus on goals within their control. Lean-agile teams are cross-functional and self-sufficient to come up with goals they can achieve without outside influence.
Limiting the interdependencies is a critical scaling aspect. The “white space” between organizational teams needs attention to achieve agility.
Increasing visibility into the shared company objectives and interdependencies can help your organization manage the white space. The best OKR software lets your teams see what other departments are working on, especially tasks that require horizontal and vertical synchronization.
What Is The Purpose Of OKRs?
OKRs help organizations manage their employee performance in five ways:
Prioritizing – OKR solutions help your business bridge the gap between the broader goals and daily work required to achieve them. The power helps employees prioritize their daily tasks with long-term organizational initiatives.
Improve accountability – The OKRs performance expectations accountability while removing gray areas about who’s responsible for specific goals.
Aligning – Your OKRs help everyone in the organization get on the same page about what each team is doing, the reasons for doing it, and how their tasks help move an organization forward.
Creating transparency – OKRs help foster a company culture of openness through informing everyone of the priorities and impact of individuals and teams in an organization—everyone from the intern to the CEO.
Key performance indicators (KPIs) are measures for tracking organizational operations. Pick a subset that is key to the success of your project or team success. A strong KPI offers meaningful information to shape the decisions you make.
OKRs have a direction and soul to them. The objective is what you want to accomplish, while key results are how you’re getting there. Because KPIs are measurable, they are excellent key results.
Numbers for tracking business operation
Founded on past results or future goals
Monitor the benchmarks or stead-state
Actions that trigger when numbers are off track
Likely to be the same from year to year or quarter to quarter
Conversely, OKRs are:
Action-oriented goals and measurements
Founded on directional, aspirational, and mission-based objectives
Tied to a mission
Actionable when issues occur
Time-bound, most organizations choose quarterly
Constantly changing depending on the business requirements—quarterly or annually
Are OKRs Good For Startups?
As per research, five out of 10 startups fail within the first five years. Have you ever wanted to understand why innovative ideas don’t transform into successful ventures?
The first task for any startup is to find the right product-market fit to gain success or even survive.
However, finding the product-market fit is difficult. The process requires defining your hypotheses and testing them. Principles of OKRs can help startups find the right product-market fit:
Objectives – An aspirational objectives map to the hypotheses you’re testing. The map includes testing if there is a market for your product and testing factors such as delivery model, price, marketing communication, and more.
Key results – The metrics for measuring success towards achieving the objectives.
Using OKRs offers startups several benefits:
Transparency – Using OKRs ensures everyone in the organization is clear about the goals and achievement status of each OKR.
Focus – Limited resources mean that everyone in your startup concentrates their energies on achieving specific objectives. Clearly defined OKRs and real-time frames give everyone direction on what needs doing on a particular day or week.
Identify problems early – Weekly OKR performance reviews force issues to surface because each team has to report their progress and confidence level in achieving the set key result. Early-stage startups can set the performance reviews twice a week until they find the product-market fit.
Alignment – Everyone in the startup works on tasks aligning towards the overarching goals.
How Many OKRs Should A Startup Have?
It’s tempting to pile on objectives, but their effectiveness stems from their focus. Google OKRs experts recommend each team should have five objectives max with four key results for each objective.
Set at least one or two objectives for the planning phase at the organization level. Cascade down into one or two objectives for each team and one to two objectives for each individual on a team.
The objectives offer answers to the top one or two items that require accomplishing within the quarter and contribute to the long-term organizational vision.
These objectives can also balance each other. For example, balance an efficiency-based objective with a quality-based one.
However, make sure you have a set number of OKRs achievable within a specific timeframe. The number of objectives and key results can change from team to team.
5 Steps To Embedding OKRs
Setting goals is not a one-size-fits-all procedure. When setting out to embed an OKR program, here are the steps you need to take before, during, and after.
Set your mission, vision, and purpose – Your mission statement provides the direction, while vision provides the goal once you follow the direction.
Track your KPIs – KPIs let you know what requires analysis to determine your OKRs basis.
Define the strategic pillars that help you scale – Strategic pillars are three to four elements your business needs to excel in, no matter what else is happening.
Plan startup OKRs – Create OKRs that encourage best practices, especially customer development and agile processes.
Take your pulse weekly and stay agile – An OKR check-in where you report on the goal progress of team OKRs and set new priorities for the next week.
Common OKR Mistakes To Avoid
OKRs are effective for goal setting. While simple and easy to use after your business develops a rhythm for them, it’s easy to make mistakes when introducing OKRs.
Here are the most common OKR mistakes and how to avoid them.
Creating Key Results That Are Projects Or Tasks
Your OKR goals aren’t tasks or projects. Instead, they are results or outcomes.
An OKR goal or objective is what you want to achieve, and you must complete a combination of projects to reach your goal. A task is something you do, while a project is a combination of tasks.
Consider using a work management platform to track company goals and activities your employees need to complete the key results and objectives. The OKR platform will help your employees stay on track, and combining weekly one-on-one check-ins means they’ve got no excuse for failure.
Adding Poor Metrics To The Results
Not having a measurable figure or poor metrics accompanying the key results is a common mistake. It also means the OKRs are vague and not aligned to specific and measurable outcomes.
Consider adopting smart goals framework to ensure your OKRs are specific and measurable within time.
Easy To Achieve Targets
It’s tempting to set up easy targets to prove your teams are consistent performers. However, achieving 100% success from OKRs means challenging yourself.
The key results you choose should be such that you’ll achieve at least 60% to 70% of them. Key results should be difficult, but not impossible.
Creating Too Many OKRs
Without imposing a limit on OKRs, you’re setting up the team for failure. Employees lose focus when there’s too much to do and become overwhelmed and disengaged.
Instead, set up only three to five objectives in a quarterly time frame or even fewer when introducing them to your startup. Consider introducing one or two more objectives each time the teams meet their latter.
Forgetting Your OKRs
Update key results regularly. Consider creating weekly OKR discussions and make them a ritual with your team. Otherwise, you’ll find yourself off track at the end of the quarter.
Benefits Of Using OKRs
Businesses realize several benefits when implementing OKRs. However, many benefits depend on the organization, culture, and others.
That said, the benefits of adopting OKRs include:
Business growth means new people are constantly joining the team. Such development requires everyone to move in the same direction, but it can be challenging. Many employees aren’t aware of your mission, vision, or objectives.
Further, it’s sometimes difficult for employees to know what their peers are doing. Such an environment leads to resources and effort waste. But OKRs can help prevent this.
OKRs provide a simple framework that keeps everyone in the know of the business objectives and direction. The information offers employees a better, more productive means of utilizing their time and resources available.
A key element of OKRs is using connections between team and organization objectives and connecting them to day-to-day work. Aligning the daily activities to objectives helps you understand the team and company focus. Plus, others know what the priorities are.
Get Teams Aligned And Connected
It’s not enough to write your business goals and teams’ OKRs in a digital workspace and expect all employees to agree. The best alignment fosters two-way communication—bottom-up and top-down.
The leadership explains and clarifies the organization-level direction, so the teams have data to create their OKRs within a quarter. After drafting the OKRs, each department presents them to the rest of the organization and answers queries that may come up.
Prioritize Weekly Plans
Weekly check-ins are a starting point for creating plans for the upcoming week. Clear objectives and key results allow team members to choose how they’ll achieve the OKRs.
Weekly plans are also linkable to the team's objectives. The strategy allows a clear view of how the plans drive objectives and if they’re moving forward.
Track Transparency And Accountability
Achieving company OKRs requires collaboration from different teams. Each team is working towards their OKRs as a group, and the weekly OKR check-in meeting ensures everything is on track.
These weekly meetings also help foster mutual understanding and build trust. The check-ins must have a clear agenda and shouldn’t last longer than 30 minutes. You can incorporate the check-in as part of a regular team meeting.
Set Improvement Driving Goals
OKRs encourage continuous growth and development. You have an option between these two goals:
Committed goals let the team know how they’ll achieve 100% on the progress bar.
Aspirational goals may not reach 100%, but they’re still critical for ongoing improvement and growth.
How Do You Effectively Use OKRs?
Consider these steps when using OKRs:
Set the objective –Evaluate the current work performance and identify areas that require developing or improving.
Plan the steps – Use your current starting point to determine the steps you need to take to achieve an objective.
Identify key results – The key results are a way of determining if you’re one step closer to your objective and measuring your progress.
Define performance measurements – Performance analysis is more straightforward when you have measurable figures such as revenue figures, percentages, client ratings, and others.
Create smaller goals – Smaller tasks can help achieve a key result and help you remain focused on the objective. Diving into the smaller goals also ensures you complete each step thoroughly.
Recognize progress – Smaller goals will help you stay motivated. Recognize each minor accomplishment to keep your motivation high.
How Software Can Help In OKR Management
Startups can use OKR software as a single repository for employees to understand what needs accomplishing (objectives) and ease tracking measurable and specific actions (results). Other ways the software can help in OKR management include:
Automating manual processes – Your HR team will save hours using real-time software instead of manually tracking the goals of the team and results on spreadsheets.
Enhancing communication and collaboration – Software includes OKR workspaces that allow employees to discuss business goals, offer answers, and provide feedback.
Maintaining a single source of information –Details on the individual and team goals and critical results are available in one central repository for easier access.
Flair’s OKR Management tool is the best performance management software that saves you hours. Especially for sharing your organization’s goals, tracking results, and making them visible for all your employees for time-effective planning and growth flexibility.
The OKR framework offers us a robust but flexible means of aligning business strategy. Excellent OKR tools, such as our performance and goals feature, will not hold you back. As you consider the options available, ask a few simple questions that’ll lead you to the best OKR software for startups.
Consider OKRs as a goal-setting strategy that can help startups move from initial hardship fast by focusing efforts on what matters. Your employees are the frontline warriors, and OKR is the guiding beacon.
Last note: even if you’ve only one OKR, pursue it until completion. Take each OKR seriously if you’re eager for results.
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