Can
OKRs be useful for my small business?
The short answer is
yes—implementing OKRs can lead to increased results at your startup or small
business. Here are several reasons why:
They inspire
OKRs promote aspiration
and unite team members towards a common goal, because the “Objective” element
(of each OKR) presents a high-level and exciting vision of where a team is
headed. Ideally, top-level OKRs should align with your company’s mission and
reinforce core values.
They establish strong
communication & clarity
An important factor in
any successful OKR strategy is aligning Objectives throughout your
organization. A well-defined strategy keeps different teams on the same page,
and opens up channels for both bottom-up and top-down communication. While this
may seem simple in an environment where you have just ten, twenty, or fifty
team members, maintaining open and rapid communication is often one of the
major challenges small businesses face as they grow.
They accelerate
growth
Well thought-out OKRs
can inspire a team to achieve more than they previously thought possible. From
streamlining your existing processes to taking your growth to the next level,
OKRs are a powerful catalyst for results.
Google has popularized the idea of setting “moonshot” or “stretch” goals to
accelerate growth. The idea of setting difficult goals isn’t simply to push
your team members beyond their limits—in fact, it’s generally agreed that 70%
is an ideal level of attainment for a moonshot OKR. Setting stretch goals can make sense,
especially in smaller organizations, because goals are meant to be
inspirational and aspirational.
It can be more powerful to consistently set ambitious OKRs and achieve a 70%
success rate than to set mediocre OKRs and attain perfection all the time
(although less ambitious “roofshot” goals also have their place in an OKR
strategy geared towards growth).
They can head off future
problems
As companies expand and
hire more team members, decision-making and chains of command quickly become
more complex. A great way to avoid the “growing pains” experienced by so many
startups is to put systems in place as early as possible, so that you don’t
find yourself cobbling together solutions on the fly in the middle of a
rapid-growth phase.
Making OKRs a success
It’s important to note
that OKRs aren’t a magic bullet for any organization, regardless of size. For
OKRs to really make a difference in your company, you’ll have to take an
organized approach —this includes making a plan, following it through, and
ensuring that everyone is onboard.
Make a plan and communicate
it
If you’re thinking of
using OKRs, the first thing to do is to make sure all your team members know
what OKRs are, why they are important, and what will be expected of them.
Emphasize the ways that OKRs will benefit the organization and each
individual.
Ideally, you’ll want to create a written game plan to share with your staff. It
should cover the following points:
- A
timeline for creating OKRs
- Many
organizations choose to set OKRs at the beginning of the financial
quarter, though some work on half-yearly cadences
- Your
organization’s “OKR flow-chart”
- This
involves aligning OKRs both vertically and horizontally
- A guide
to writing OKRs effectively
- For best
results: Objectives should be ambitious and qualitative, while Key
Results must be measurable
Take OKRs seriously
After launching your OKR
strategy, you’ll need to continue to invest time and devote attention to the
process.
This is easier said than done. Here are some tips to help you stay on
track:
1) Have a specific person
take ownership of the OKRs program. This OKR Champion can be the founder or a
designated team member. If you choose to assign the OKR Champion duties to a team
member, it’s important that the organization recognizes their authority in
regards to the program.
2) Track the progress of
your OKRs regularly. A common way of doing this is using the confidence
rating system , which is flexible and great for small teams.
Don’t tie OKRs to
performance reviews
A final tip for making a
success of OKRs at your startup or small business is not to use them as
performance reviews, or as part of the review process. Since you may not have a
formal review process yet, it can be tempting to link achievement of an OKR
directly with performance and compensation decisions. However, there are some
good reasons not to do so.
As previously described, “moonshot” goals can be extremely effective as OKRs,
because they motivate your team to think outside the box. Remember that full
completion of a moonshot goal can be as low as 60%-70%. By rewarding 100%
completion of all OKRs or punishing non-completion, you may inadvertently be
causing your team to avoid true moonshot goals. Instead, they’re likely to set
less ambitious goals in an attempt to gain reward or avoid failure. This is
called “sandbagging”, and it defeats the point of using OKRs.
