What is an organization’s culture? It’s more than vibes, perks, or benefits packages. In this article, we break down what organizational culture means, why it’s important, and how you can foster one that’s collaborative through the use of Objectives and Key Results (OKRs).
Fostering a collaborative organizational culture with OKRs
It seems like everyone is talking about company culture these days. But the culture of an organization is so much more than the vibe in the office, the litany of perks or the benefits packages. So what does organizational culture mean, why is it important, and how can you foster one that’s collaborative through the use of Objectives and Key Results (OKRs)?
What is organizational culture?
More than just the environment of a company, your organizational culture is the collection of your company’s core values and beliefs, as well as how employees work. This includes the set-up or structure of the organization, the support in place, and the general feeling people get from working there. When we hear about toxic work environments, its origins often stem from lack of organizational culture, or one that’s lost its way.
What are some characteristics of healthy organizational cultures?
There are many ways a company might express their organizational culture, including:
- The way they work and how they treat their employees, customers, etc.
- Employee’s freedom to make decisions and take risks
- Transparency of information flow both internally and externally
- The company’s vision and how its employees fit into that and contribute to it
Employees want to feel like they belong and are contributing to something they believe in and where they’re valued. Additionally, most want a place to grow and one that encourages them to share ideas and stretch. A healthy organizational culture will not only support various work styles, but also values different ways of thinking.
Why is collaboration important to healthy organizational culture?
Great work is rarely done by individuals. Collaboration is required for high performance. And you can’t have collaboration without communication! Teams that work well together use communication to build trust and a feeling of support, especially in today’s hybrid or remote environment. Collaboration also fosters more creativity, productivity and focus, because it requires the group to join together to reach a shared or common goal.
What are the hallmarks and benefits of a collaborative organizational culture?
There are several but we’re going to highlight four:
1. Strategic alignment: As we just mentioned, collaboration is about working to achieve a shared goal. When strategy and culture are aligned, it makes it easier for your employees to execute. In fact, misalignment can impact profitability, employee engagement, leadership effectiveness, and more.
2. Effective communication: In the age of remote work, communication might be the single most important factor in driving a collaborative culture. Great teams ensure that everyone is on the same page (understands the “why”), is clear about what they and others are responsible for, and has accessible timelines and markers of progress. When all of these are in place, it fosters inclusion as well as engagement and productivity.
3. Intellectual honesty with psychological safety: No one will be willing to speak up or share if they don’t feel their ideas (and critiques) are welcome. Or worse, they fear an idea might be mocked, stolen, or ignored. A collaborative culture is one where everyone is not only treated equally but also valued for their contributions. Just as importantly, they feel comfortable sharing them, even when they dissent.
4. Inclusive of multiple perspectives: The very nature of the word “diversity” means multiple perspectives. So it goes without saying that a collaborative culture is one that celebrates diversity of thought, ideas, and experiences. Diverse teams are more likely to innovate and solve problems. And studies show that diverse teams simply perform better.
How can I make my organization more collaborative?
Like any impetus for change, collaboration is modeled at the top. Driving a culture of collaboration is a regular and intentional discipline. Random brainstorming isn’t collaboration. And while this might seem counterintuitive, truly effective collaboration can be clearly defined and measured. Here are a few ways to start:
- Set shared goals (with objective results)
- Be transparent and share knowledge
- Build trust-filled relationships
- Create a positive relationship to failure
How can OKRs help foster a more collaborative organizational culture?
Many things that should be transparent in organizations are left unsaid. OKRs, which stands for Objectives and Key Results, is a methodical approach to clarifying and aligning priorities, and surfacing friction and confusion before they become insurmountable problems. Leaders can never underestimate the power of clearly stating what the group is working toward and how they’ll prove they’ve turned activity into impact (aka “success”). Their effectiveness is in part due to the fact that OKRs aren’t done solo or kept under wraps, they’re built with collaboration in mind. Goals aren’t siloed, but are shared out in the open, where everyone in the organization can see them. They’re set, owned, executed and evaluated as a team. From leadership cascading OKRs down to departments, to departments laddering OKRs up to larger Objectives, the structure of OKRs won’t work without constant communication and collaboration about what matters most.
When you use OKRs to foster a collaborative culture, you can empower teams to:
1. Align to reduce duplicate or conflicting efforts
Using OKRs does more than just goal tracking, it aligns organizations from the company-wide level all the way down to individual-level Objectives. Alignment and focus reduce wasted effort caused by different teams pulled in too many different directions.
2. Make good decisions when they’re not in the room
When priorities and proof of progress are clearly written down and tracked, it frees leaders to make more decisions on their own. Many teams who use OKRs report needing fewer “status” meetings as a result and the next right decision is clearer because everyone has the same definition of success.
3. Clarify mutual accountability
Many projects get done by teams of teams. When goals and success are shared, it’s easier to keep each other accountable. When using OKRs, everyone is on the same rhythm for checking in on shared goals, and everyone is committed to completing goals in the same period of time.
4. Encourage teams to take bigger risks and learn by divorcing bonuses and compensation from OKRs
Sometimes the best way to solve a problem is to aim high. For example, in order to make a light bulb last 10 hours longer, sometimes you aim for it to last 100 hours longer. Teams can get equally excited and nervous about big challenges. If they fail, will it hurt their career or bonuses? Because OKRs are separate from performance reviews, it’s possible to reward high risk/high reward without fear of losing job security. This is something Anne Wojcicki, CEO of 23andMe, realized when she implemented OKRs at her organization. “We want people to aspire, to stretch, but also be unafraid of failure. It’s not about the bonus. We’re really clear that this is not going to be tied to your compensation.” The result is an environment where employees work hard for more intrinsic reasons such as fulfilling the mission.
Creating an organizational culture is a deliberate and intentional process that takes time and care. But it’s worth the investment: Culture is a huge determinant of employee engagement, retention and attraction. By using OKRs to map out a collaborative culture, you help ensure that communication is at the forefront and everyone is married to a shared vision for success.
If you want to learn more about using OKRs to foster an organizational culture, take our OKRs 101 course or sign up for our Audacious newsletter.