When you’re starting up a new business, you can’t help but feel the thrill of pursuing a dream and the freedom to create something from scratch, which can be incredibly motivating. You’re basically taking that leap of faith, fueled by passion and a desire to make a difference, even when the path ahead might seem daunting. But here’s some good news: one way to keep the ride smoother is by using OKRs, which stand for Objectives and Key Results. OKRs help align your team and keep everyone focused on what matters most.
…What Are OKRs?
In simple terms, OKRs help you set goals that everyone can understand and work towards. An objective is what you want to achieve. It should be clear, inspiring, and time-bound, like “Increase customer satisfaction.” The key results are the steps you need to achieve that objective, like “Reduce customer response time to under 2 hours” or “Achieve a customer satisfaction score of 90%.”
Companies like Google, LinkedIn, and Spotify all use OKRs. According to John Doerr, who introduced OKRs to Google, they played a huge role in Google’s success. And if it’s good enough for Google, it should be good enough for any startup.
Why OKRs Matter
OKRs matter because they bring clarity. In a startup, it’s easy for people to get pulled in 10 different directions, but OKRs help everyone know what’s important and what they should focus on. A study from Harvard Business School shows businesses that set clear and ambitious goals perform significantly better than those that don’t.
Second, OKRs boost accountability. When everyone knows the key results they are aiming for, it’s easier to track progress. You can see who’s slacking and who’s doing really great.
OKRs also create alignment which is really important for startups that have teams working on various projects. Research from MIT found that employees who believe their goals are aligned with the company’s are more engaged and motivated.
Setting Good OKRs
Your objectives should be bold but achievable. You want to aim high enough to inspire excitement and push the team to stretch their capabilities, but not so high that it feels impossible. A well-set objective should light a fire under your team and make them feel like they’re part of something significant and worthwhile.
Key results, on the other hand, need to be specific, measurable, and verifiable. They act as your milestones on the way to reaching that lofty objective. Avoid vague statements like “improve sales” because they don’t give clear direction or benchmarks for success. Instead, go for something concrete, like “increase sales by 25% in the next quarter.” Real OKR examples include targets such as “launch three new product features by the end of Q2” or “double our social media engagement within six months.” Being specific helps in multiple ways: firstly, it leaves no room for ambiguity, so everyone knows exactly what they’re aiming for. Secondly, a measurable target lets you track progress and adjust strategies as needed. If, halfway through the quarter, you see you’re only up by 10%, you know you need to ramp up efforts or pivot your approach.
When you use OKRs you can reap the benefits of clarity and accountability. Start by setting bold but achievable objectives, make your key results specific and measurable, and review them regularly – and don’t forget to celebrate your wins, no matter how small.
