Nailing your OKRs – write productive Objectives

Introduction to Objectives and Key Results (OKRs)

 

As Sales Directors we are always looking for ways to improve the team’s ways of working, increase revenue, and stay ahead of the competition. One way to achieve these goals is by implementing the Objectives and Key Results (OKR) methodology.

 

Objectives and Key Results (OKRs) are a way of defining goals for your team. They’re used by some of the world’s most successful companies, including Google and Facebook. OKRs were first developed by Intel in the 1980s as a way to align their employees around specific goals, and then popularised by investor John Doerr in his book “Measure What Matters” . According to Andy Grove, former CEO of Intel: “We had tried many other approaches before arriving at OKRs–but none worked as well.”

 

In this article, we will explore how sales organizations in medium-sized companies can implement OKRs to improve their sales processes and increase revenue.

 

 

 

Definition and Components of OKR’s

 

Objectives and key results (OKRs) are a simple yet powerful way to set direction for your team. They help you focus on what matters most, align around priorities, and drive results.

 

OKRs have 3 principal components:

    • Objectives are high-level statements that define the purpose of your business or project. An objective could be “increase revenue by 10%” or “improve customer satisfaction ratings.” It’s important for objectives to be measurable so that you can track progress against them over time.
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    • Key results are specific behaviors or outcomes needed from each person on your team in order to achieve an objective–for example, “Achieve 90% success rate on all projects” or “Grow social media followers by 20%.”
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    • Tasks: The activities that you undertake to get you the Key Results, which in turn leds you to the Objectives. By evaluating our ability to perform the tasks, you can coach, train and prepare yourself better to reach the objectives. 
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    • Weighting is an optional additional component of OKRs that helps prioritize which key results should receive more attention than others; this might be based on importance (e.g., revenue generation), difficulty level (e.g., increasing customer retention rates), urgency (e.g., launching new product features before competitors do), etc..

 

 

 

Benefits of Using OKRs for Goal Management

 

  • Improved communication: OKRs are a clear way to communicate goals and progress, which helps teams stay on the same page.

 

  • Better collaboration: When everyone knows what they are working toward, it’s easier for them to collaborate effectively.

 

  • More effective goal setting: OKRs help you set goals that align with your organization’s larger strategy so that you can achieve more impactful results–and have fun doing it!
 
 

 

Creating a Culture of Accountability with OKRs

 

The goal of any company is to create a culture of accountability. This can be done by focusing on OKRs, which are the key results that you want your team to achieve.

 

For example, if you’re working in sales and your objective is “to increase our revenue by 20% this year,” then one key result would be “increase sales leads by 10%.” Each employee has their own set of objectives and key results so they know exactly what they need to do each day in order for the company as a whole to meet its goals.

 

OKRs are not just an HR tool. They’re a way for the entire company, from the CEO down to the newest hires, to work together towards a common goal. When everyone is working towards an objective and knows exactly what they need to do each day in order for that objective to be met, then it’s easy for them to feel engaged in their jobs.

 

This is why OKRs are so effective. They give employees a clear idea of what’s expected of them, and they help everyone involved with the company to understand how their daily tasks fit into the larger picture.  Studies show that organisations, just by working with clear, agreed and challenging goals increase productivity by up to 15%. With a feedback and measure structure that continuously tells us how we are doing, that effect is nearly doubled!!

 

 

 

Basic Rules for Writing Effective Objectives and Key Results

Some key learning around objectives and OKRs 

 

      • Set SMART objectives. SMART is an acronym for Specific, Measurable, Achievable, Relevant and Time-bound.

 

      • Use the cascading approach to set goals at all levels of your organization or team. This means that each level has its own set of OKRs that cascade down from higher level objectives (i.e., a departmental manager’s OKRs cascade down from his/her company’s annual goal).

 

      • Make sure your key results are realistic–you don’t want them to be too easy or too difficult; they should be challenging but achievable within the timeframe you’ve allotted yourself for achieving them.

 

      • Key Results must be Actionable – i.e. the person responsible must understand and know what to do with them! Consider being more activity oriented and detailed when the person is less skilled with the specific task at hand, and allow yourself to be more result oriented when the person already possess that skills and knows perfectly what to do.

 

 

Note: Change Management by definition requires people to do something new. This means that no matter the seniority of the person, he or she will be helped by more activity oriented KRs than higher level results. Can we help? Let us know!

 

 

 

Tools that help you write and achieve your OKRs

The first step to achieving your OKRs is setting them. You can use the following tools to help you do so:

 

  • Objectives and Key Results (OKR) template
  • Google Docs template
  • Microsoft Excel template
  • Purpose specific softwares, some examples
    • Quantive – connecting high level with individual contribution
    • Leapsome – Performance Management & Personalised Learning Platform
    • Culture Amp – Performance Management and Employee Engagement 
    • profit.co
    • etc etc 

 

 

Examples of Well-Written Team OKRs

Here you will find a few examples of Sales team OKRs, the web is full of examples and suggested OKrs that you can find inspiration in. Just remember to make the KRs really SMART, and actionable.

 

  1. Objective: Increase our sales department revenue by 15%.

Key Results:

        • Maximize pipeline value to $250,000 every quarter
        • Improve closing rate from 15% to 30%
        • Implement a Activity Based performance system for evaluating performance
        • Increase scheduled calls per sales rep from two per week—to seven

 

  1. Objective: Reduce the average time it takes to close a sale from 9 months down to 6 by March 31st.

Key Results:

        • Reduce time from initial contact to demo by 30%
        • Reduce time form demo to WIN by 30%
        • Improve our sales process by implementing a new sales training program

 

  1. Objective: Improve the efficiency of our sales team

Key Results:

        • Conduct monthly training sessions for each stage of the customer lifecycle
        • Increase conversion rate from 10% to 30%
        • Receive positive feedback from 90% of our customers about the efficiency of our sales team

 

You may want to find more inspiration in the “What Matters” page  

 

 

 

Common Pitfalls When Setting and Achieving OKRs

 

In addition to understanding the basics of setting and achieving OKRs, it’s important that you avoid common pitfalls. Here are some things to keep in mind:

 

        • Make sure your goals are realistic. If you set unrealistic goals, they may be unattainable and cause frustration or disappointment when they aren’t met.

 

        • Don’t manage expectations by setting low expectations for yourself or others in order to make them look better than they actually are. This can lead people down a path where they feel like their work isn’t good enough or worthy of recognition because it doesn’t meet this new standard that was set artificially low by management (and thus not aligned with reality).
        • Writing Key Results that the person don’t know how to act upon. Key Results should be specific, measurable and time-bound. If you don’t know how to act on a goal, then it’s not really a goal; instead it’s just a wish that might come true by chance. For example: “I want to lose weight” is not specific enough, but “I will run for at least 30 minutes three times per week” is specific because it specifies the activity and the frequency with which it needs to take place in order for you to reach your goal of losing weight.
        • Too long between reviews: OKRs are guidelines for action, not annual bonus objectives or laws set in stone. Hold frequent performance reviews, that you keep light and short – 30 – 45 minutes ever 2-3- weeks is better than a 2 hour quarterly session that becomes everything else than dynamic and creative. If an OKR is not achieving its desired results, don’t wait until the end of the quarter to course correct.

 

 

 

Comparison of OKRs to Other Frameworks and related Terms

 

Since the introduction of objectives and management by objectives in the 50’s many models and frameworks have been developed and used. We will have a look at some fundamental models that you will come in contact with. A brief comparison of OKRs with other goal management frameworks:

 

Balanced Scorecard is an effective tool for measuring organizational performance across four perspectives: financials; customer metrics; internal business processes; and learning & growth opportunities. While both tools use a similar approach to measuring performance across multiple dimensions of an organization’s strategy, they differ significantly in how they define success: Balanced Scorecard measures outcomes whereas OKRs measure progress towards achieving those outcomes over time 

 

MBOs: Management by objectives (MBO) is another well-known framework that functions similarly to the others. Aligning objectives, creating a plan of action, and measuring performance are key components in MBOs—as they are elsewhere. However, MBOs differ from the other frameworks in that they first define objectives and then measure performance against them. This differs from balanced scorecards and OKRs, which focus on measuring outcomes instead of progress towards those outcomes. 

 

SMART is not really a framework, as much as it is good advice on HOW to write objectives in any framework. When we write goals we shovel always make them Specific, Measurable, Attainable, Relevant and Time-bound. OKRs also have these characteristics. 

 

KPIs – stands for Key Performance Indicators and depicts quantifiable measures that track performance over time. You can select KPIs for multiple organizational domains, including project, individual, departmental, or business objectives.

 

BHAG goals stand for Big, Hairy, and Audacious goals. These refer to challenging, long-term strategic or business goals that your organization uses to guide it. Comparable to the vision of the company, and the mission it has put for itself. They are far ahead n the future, but still help direct employees toward effective action.

 

4DX –  4 disciplines of strategy execution– a framework developed by firm Franklin Covey. It proposes four core disciplines for helping individuals and teams reach their goals. These disciplines include:

            • Focus on the wildly important:Teams and individuals should narrow down their focus to no more than two Wildly Important Goals (WIGs)

            • Act on the leading indicators (lead measure):focus on activities that drive the best results, where lagging indicators describe what you’re looking to achieve and lead measures describe the activities that drives toward the goal

            • Keep a performance scorecard: teams should have access to a visible scorecard that lets them know whether they’re successful or not

            • Create a chain of accountability: People at all levels are held accountable for their goals through weekly WIG sessions where they discuss commitments, performance reviews, and improvement plans

 

 

Conclusion and Resources for Further Learning

 

OKRs are an effective way to measure progress and hold yourself accountable. They can be used for both personal goals, as well as company-wide objectives.

 

They are a simple framework that can be used by anyone in any field. If you’re interested in learning more about OKRs, here are some resources: