OKR guide for small teams: set goals that work

This OKR guide explains a simple way to set goals: pick one objective, then attach a few key results you can measure. A small team can learn it in an afternoon. The method is called Objectives and Key Results, or OKRs.

What OKRs are

An objective says what you want to achieve. It is short, plain and a little bold. A key result is a number that shows whether you got there. If the objective is the destination, the key results are the signposts.

Publisher Portfolio describes it this way: objectives state what a team wants to achieve, and key results are measurable actions, with a deadline, that lead to it. The goals are also visible to everyone, from new hires to the chief executive.

Source: Penguin Random House, product page for John Doerr, Measure What Matters (Portfolio, April 24, 2018) (penguinrandomhouse.com/books/546304/measure-what-matters-by-john-doerr/).

Where the method comes from

John Doerr first met OKRs as an engineer at Intel in the 1970s. He credits Andy Grove, who ran Intel, with building the best-managed company he had seen. Later Doerr worked as an investor and taught the method to more than fifty companies.

One of them was Google. In the fall of 1999, Doerr had just backed Larry Page and Sergey Brin with $12.5 million. The founders had strong technology but no clear business plan, so he taught them OKRs to help set priorities and track progress. Doerr told this story in his book Measure What Matters, published in April 2018.

Source: Penguin Random House, Measure What Matters product page (penguinrandomhouse.com/books/546304/measure-what-matters-by-john-doerr/).

How Google describes the rules

Google's re:Work guide sets out a few rules worth copying. Objectives should be ambitious and may feel a little uncomfortable. Key results should be easy to grade with a number from 0 to 1.0. A score of 1.0 means fully achieved, and a key result can be yes or no (0 or 1) or partial. Launching three of six features, for example, earns 0.5.

The guide calls a grade of 60 to 70 percent the sweet spot. If you score 100 percent every time, your goals are probably too easy. It also says OKRs are not the same as employee evaluations, so people do not need to fear a low score.

Source: Google re:Work, "Set goals with OKRs" (rework.withgoogle.com/en/guides/set-goals-with-okrs).

A worked example for a small team

Say you run a five-person online shop. Your goal for the quarter is to make repeat buying easy. Here is how it could look.

Objective: Turn first-time buyers into regular customers.

• Raise the share of customers who order a second time from 15 percent to 25 percent.
• Send a thank-you email to 100 percent of new buyers within two days.
• Collect 40 written reviews from past customers.

Notice the pattern. The objective uses plain words with no number. Each key result has a number and an end date, the quarter. Anyone on the team can check progress without asking for a meeting.

At the end of the quarter, score each key result from 0 to 1.0. Say the repeat rate reaches 21 percent. That is a good partial score. The emails all went out, so that scores 1.0. Reviews reach 20 of 40, so that scores 0.5. Average the three. You land near 0.7, which fits the range Google calls healthy.

Tips for starting

• Pick one to three objectives. A small team cannot chase ten at once.
• Give each objective two to four key results.
• Write results as outcomes, such as repeat orders, not tasks, such as "send emails".
• Check in at the midpoint of the quarter. Google teams often review progress partway through, then again near the end.
• Share the goals with the whole team so people can see how their work fits.

Source: Google re:Work, "Set goals with OKRs" (rework.withgoogle.com/en/guides/set-goals-with-okrs). The shop example is our own illustration, not a case from either source.

Common mistakes

The first mistake is a to-do list posing as key results. If a result can be ticked off without changing anything for the customer, rewrite it. The second is setting goals you are sure to hit. Google's guide notes that scoring full marks all the time suggests the goals are not ambitious enough.

The third is using the score as a pay or review tool. Google's guide says OKRs are not the same as employee evaluations. Treat the grade as a learning signal. If the team misses, ask why, then set the next quarter's goals with that answer in hand.

Source: Google re:Work, "Set goals with OKRs" (rework.withgoogle.com/en/guides/set-goals-with-okrs).

Sources

• Penguin Random House: penguinrandomhouse.com/books/546304/measure-what-matters-by-john-doerr/
• Google re:Work: rework.withgoogle.com/en/guides/set-goals-with-okrs