It’s easy to look at successful businesses and assume it was their core idea that got them where they are. Intel invented the microchip, Netflix pioneered on-demand video streaming, and Google built the modern search engine. But an idea will only get you so far.
What turns a scrappy startup into an industry-leading company often isn’t their original idea, but their execution.
For example, Google is the name in search—but not because Larry Page and Sergey Brin had a totally original and utterly brilliant idea. They were, in fact, the 18th search engine to arrive on the scene in the early days of the internet. What carried Google beyond its competitors was how Page and Brin executed their vision with exceptional focus and clarity.
Reflecting on Google’s success, Page singled out Andy Grove’s OKR (Objective and Key Results) methodology as a key factor in his company’s success.
“OKRs have helped lead us to 10x growth, many times over,” Page wrote in John Doerr’s 2018 book Measure What Matters. “They’ve helped make our crazily bold mission of ‘organizing the world’s information’ perhaps even achievable.”Read: What are objectives and key results (OKRs)?
Is setting these goals really worth it? The short answer is yes. Organizations that implement this goal-setting methodology consistently benefit from better execution on projects and initiatives. With clear goals, you can effectively turn great ideas into better businesses.
While execution can be challenging, it doesn’t have to be complicated. All you need is consistency, dedication, and planning. Here’s how you turn goals from a nice idea into a sustainable, long-term management practice.Try goals with Asana for free
The OKR formula is designed to be flexible enough to fit most purposes. Yet many organizations treat it as a rigid framework and refuse to deviate from a prescriptive methodology. This is a recipe for disaster.
Before you implement this goal-setting methodology, we recommend setting basic rules for how OKRs will function at your company. These rules define how goals work in your teams and your organization. Specifically, there are three elements to consider: cadence, check-in process, and creation.
Cadence: This is simply how often you set goals. In our experience, setting objectives annually delivers the best reward as they become the pillars of your strategy. However, if your organization moves rapidly, you have the option to set goals more frequently—half-yearly, quarterly, or even monthly.
Check-in process: The schedule you set to update and review your progress. Again, your optimal schedule is unique to your organization. If your goals are grand and slow-moving, a bi-weekly or monthly check-in may suffice. However, if your goals are smaller and progress rapidly, you ought to check-in more regularly.
Creation: There are three basic models—top-down (leaders set both objectives and key results), bottom-up (individuals set both objectives and key results), and hybrid (leaders set objectives and individuals set key results). Deciding what model works best for you depends on your company size and structure.
Now you’ve set the basic rules of your program, you’re ready to start rolling out the framework across your organization. Remember: OKRs stand for Objectives and Key Results. You should be able to sum up your goal in one sentence: I will [objective] as measured by [key result].
Start off by co-creating top-level objectives for your organization. These are the pillars of your strategy for the next year. They’re the important and substantial activities that lead to the success of your mission. Crowdsource ideas from stakeholders across your organization and refine them with in-depth analysis from your top brass.
But be careful your output does not grow out of control. As more people with different perspectives join the conversation, the number of objectives can quickly balloon.
Some examples of great company-wide objectives are:
As often as possible, design your objectives to be falsifiable and clearly measurable. At the end of your goal cycle, you should be able to conclusively say whether or not you met each objective.
Once you’ve decided on your company-wide objectives, you need to work out how you’ll track your progress toward those goals. That’s where key results come in.
To write great key results, try using the SMART methodology.
SMART is an acronym that stands for:
Specific: What, exactly, are you working towards?
Measurable: How will you evaluate whether or not you hit your key results?
Achievable: Is this key result something you could reasonably achieve? Keep in mind, even stretch goals should be achievable.
Realistic: With the resources and time you have available, is hitting this key result realistic?
Time-bound: Does your key result have a clear timeline and end date?
Your key results should be challenging. If you’re certain you’re going to nail them, you’re not pushing hard enough. Like other companies, we follow storied investor and OKR guru John Doerr’s advice and aim to hit 70% of our key results in each period. If we achieve more than that, we know we weren’t aggressive enough in our planning.Read: Asana tips: 3 ways to set achievable goals
For every key result, make sure to align on what achieving, partially achieving, or missing the KR means. To be most effective, you should measure your success once the period is over—and having a clear sense of what success means can help your team refine and adjust your goal-setting process as time goes on.
To get the most from this goal-setting methodology, your company objectives must flow down through your organization, guiding the work of smaller teams and individuals.
Too often, companies set goals and fail to revisit them until the quarter or year is up. But when your goals are disconnected from daily work, it’s easy for work to become misaligned and for teams to lose motivation towards the goal. Conversely, research shows that when employees do understand how their individual work contributes to their organization’s goals, they’re 2X as motivated.
So to set great key results at your company, make sure you’re connecting day-to-day work with company-wide objectives. One easy way to do that is to use a hybrid goal-setting approach, where your executive level teams set company objectives, but smaller teams set the key results. When you give teams the autonomy to set their own KRs, they have a much deeper understanding of where to invest their resources and efforts to generate the best results.Read: What is a key performance indicator (KPI)?
Once you have defined your organization's objectives and key results, it’s time to identify the programs and projects you and your team will work on to achieve your goals.
One of the benefits of setting goals is that they help scale prioritization across your organization. By connecting your goals to the work being done to achieve them, you make it easier to report on your progress towards goals, and address any problems that might stop you from completing a goal.
Connecting your organizational goals to day-to-day work also keeps your employees engaged in their work. People want to know that what they do matters, and the best way to show them is to connect their work to high-level goals. So when they understand how their day-to-day work fits into the bigger picture, they feel empowered to do their best work.Read: Maximizing the benefits of OKRs
Make sure to check in on your progress regularly. Instead of setting your goals in a slide deck or spreadsheet, invest in a goal-setting platform that makes it easy to connect company objectives to key results. That way, every team has visibility into how their work is moving company objectives forward.
Once your planning cycle is completed, your work still isn’t finished. Instead of immediately moving on to the next cycle, ask your team to pause and grade their key results. Individuals should be accountable for grading the key results they have ownership of and for writing a short write up explaining the grading.
It’s okay if you don’t hit all of your KRs. In fact, teams that do hit all of their KRs may not have set aggressive enough goals. At Asana, we aim to hit about 70% of our KRs.
After people grade their key results, managers should collect the results and roll them up into their objectives. One of the many benefits of setting OKRs is transparency, so we suggest managers grade their objectives and share the overall results throughout your organization.
With your grading complete, dig into what didn’t work during the cycle and make a note of what worked well. For future cycles, you will be able to double down on your strengths and support your weaknesses. If you’ve missed either objectives or key results, host working sessions with your teams to reflect and learn.
When you set goals, you shouldn’t just focus on whether or not you check the box off at the end of the goal cycle. Rather, by setting OKRs, you're developing a framework for how to think about goals, how to connect your work with company objectives, and—ultimately—how to align and execute on your most ambitious projects.Try goals with Asana for free