Workflow

Overview of how OKRs can be set

Goal setting starts with a vision. Where should you be heading? Does your organization have a weakness to address or a strength to reinforce? A turnover that is too high? Some processes to streamline? You've found a company-wide OKR for the year!

For the year? I thought OKRs shouldn't last more than a quarter! Yes: it's actually quite common to have company-wide OKRs lasting longer - sometimes up to a year - than team or individual OKRs.

You'll see this is a recurring theme with OKRs: they're very flexible and should adapt to the needs of your organization. Let's see an example of a typical goal cycle and next we'll tweak it.

Goal cycle

Most companies organize goals in cycles. There are three steps to these cycles: goal-setting, execution, and finally the often forgotten retrospective which coincides with the beginning of the next cycle.

Typical goal cycle

Goal setting

This can last anywhere from a day to 2 weeks depending on the number of goals and people involved. Subsequent times are definitely faster than the first.

1- Set company-wide goals

Company-wide objectives should be the first step because they set the direction of all other goals.

They often stem from a long-term strategy such as entering a new market or adopting core values but can also be operational such as hitting a revenue target, or delivering a product. An OKR lasting longer than a year can be motivating but very hard to concretely contribute to.

Company goals should be set by the organization leadership. Trying to come up with a consensus company objective often leads to chaos and paralysis.

2- Set team and individual goals

If you do not use individual goals, the process is greatly simplified as you just need to agree on a few team OKRs as a group.

Otherwise, here are a few ways to set goals collaboratively. They all involve formal or informal manager approval:

  • Employee sets the entire OKRs. This works great for experienced employees. That's where you want to be after a few cycles.
  • Manager sets objectives, employee picks key results. It's similar to showing employees where to go and letting them come up with a plan they own.
  • Manager sets both objectives and key results. This is ok when the employee is new to the job (or to OKRs) but avoid doing too often to maximize employee buy-in and commitment.
  • The team chooses all (even individual) OKRs as a group. It can work for small and well-organized teams but can also lead to chaos. If you choose this route, be sure to have an OKR experienced leader in the meeting.

While this may sound rigid, in practice, it's a conversation. Let each team decide what works for them.

3- Communicate OKRs

After a series of meetings, all OKRs are ready. What do you do with them? You announce them!

Teams should communicate their final OKRs. Sometimes it's only within the team, sometimes it's to a broader audience. A few things to talk about:

  • Your OKRs
  • Why you're doing it
  • How much of a stretch the goal is

If you use an OKR management tool, use it as a reference. You can continue the conversation online.

Execution

4- Weekly Routine

Individual contributors check in their goals regularly - ideally every week - by updating how each key results has evolved.

Managers keep track of individual OKRs and mentor/help employees who may be behind. In all likelihood, managers already have something in place - weekly meetings or one on ones. There's no need to introduce another meeting but make sure that OKRs are addressed at that time.

Some teams find weekly routines overwhelming. Leave some latitude but make sure that goals are reviewed a few times during the goal period.

5- Analysis and monitoring

Every few weeks, the company leadership should monitor a few key elements during a goal period:

Progress: this is obvious but worth mentioning. Progress by company-wide goal should tell you if things are going according to plan.

Progress by team: Helping individuals is the job of the line manager. Spotting bottlenecks at the organization level is the job of the leadership and it's harder to do by reading reports. We find progress by team to be a good (but not the only one!) indicator of organizational issues.

Employee engagement: make sure that employees update and work with their goals. If half-way through the period, employees haven't had any activity, future updates are unlikely. Check that goals are specific and actionable.

If you cannot monitor progress, it's a sign that goals were not specific enough.

Retrospective

6- Team discussion and rating

After the end of the goal, teams get together and discuss what has worked and what hasn't. Individual OKRs are often discussed in a group as there's lessons to be learned for everyone.

Finally, a rating is assigned with three purposes:

  • Ensure that all parties agree on the outcome of the goal.
  • Help other teams judge if a goal was reached.
  • Help employees and managers looking back at past goals.

If results are great, celebrate. If the outcome is disappointing, don't point fingers, be as honest as possible to avoid cognitive dissonance. Employees will appreciate the honesty and it'll show that execution matters.

7- Company-wide retrospective

Company-wide goals can also be rated. If you do so, we recommend doing it publicly (email, all hands meeting...) at the same time you present the next company-wide OKRs.

Rinse and repeat.