The Objective and Key Results (OKR) model is a powerful way to express the goals of any company or organization. It can help achieve mission and vision, aid in employee engagement, and bring to the surface the top priorities of a company. OKR’s five key benefits include focus, alignment, commitment, tracking, and stretching — or as John Doerr likes to call them, “the five superpowers” of OKRs.
The benefits of the OKR goal-setting process are apparent given the roster of companies that use them: Adobe, Google, and Netflix have all implemented OKRs to astounding success. The Objective and Key Results model is a powerful way to express the goals of any company. It can help craft mission and vision, aid in employee engagement, and bring to the surface the ultimate OKR: the top priorities of a company.
But if you’re just starting out, you may be left to wonder, What makes OKRs so beneficial — not only setting, but achieving, the most audacious goals of teams and individuals? Why should I start using OKRs?
In an interview with Harvard Business Review, John Doerr says there are five key OKR benefits. These five benefits spell out the acronym “F.A.C.T.S.” so that when using OKRs, we can say that OKRs give us “just the F.A.C.T.S.”
These five key OKR benefits include…
Benefits of OKRs
Focus: Focus is the first benefit of OKRs because when you set OKRs, you are limited in the number of them. There can be more than one Objective, but no you should have no more than than three. Fewer is better. Each Objective should fit on one line. As for Key Results, you should have 3-5 per Objective. Because of this inherent necessity to limit the number of things to focus on, OKRs really force upfront choice making. An OKR cycle should start with the question, What is most important for the next three (or six, or 12) months? This time-bound query sets OKRs apart from other goal-setting systems because they bring to the surface the handful of initiatives that can make a real, immediate difference, while deferring less urgent ones. By standing firmly behind a few top-line OKRs, leaders give their teams a compass and a baseline for assessment.
Alignment: Once top-line Objectives are set, the real work begins. As they shift from planning OKRs to execution, managers and contributors tie their day-to-day activities to the organization’s company-wide vision. The term for this linkage is alignment, and its value cannot be overstated. According to the Harvard Business Review, companies with highly-aligned employees are more than twice as likely to be top performers.
Commitment: After focus and alignment come commitments. Commitments are OKRs that all have agreed will be achieved, and schedules and resources will be adjusted to ensure they are delivered. Tracking these commitments is done transparently. Each team member must create very clear signals for everyone that they are working towards their OKRs. Whether this is done through a Google Sheet or an OKR software tracking tool like BetterWorks, sharing OKR progress on all-hand slides every single month, or printing them out and posting them all over the office walls to show you now know what you’re striving for and if you’re hitting it or not, it doesn’t matter as long as there is alignment and transparency.
Tracking: Tracking OKRs from output to outcome is why management by Objectives is so popular with top-tier companies. Every OKR should be able to be tracked via the metrics established when they were written. And while OKRs don’t require daily tracking, regular check-ups — preferably weekly — are essential to prevent slippage. Having these reference points to grade your current OKRs is the long-term magic of them on the individual level. Are you on track to meet this Objective or not? Why or why not?
Stretching: Stretching is last but not least. As John Doerr says, “Larry Page of Google is the high priest of 10x-ing everything, stretching further. He’ll say, ‘I’d rather have the objective be to go to Mars, and if we fall short, we’ll get to the moon. This is how you make moonshots.’” OKRs inherently push organizations to strive further, to eke out a little more than what they thought was possible.
F.A.C.T.S. is why so many companies use the OKR system. The benefits of focus, alignment, commitment, tracking, and stretching have proven invaluable to so many.
Where can I get more information?
If you’re interested in starting our OKRs 101 course, click here.