The biggest challenges organizations face today are not new. In fact, they’re as old as business itself: how to get out of the status quo and how to inspire a team. These are challenges and will continue to be challenges – there is no easy fix. But there are a few solutions that make them easier to deal with. One of them is OKR.
What is OKR?
Take 75 years of best practices in goal management, combine them into a single methodology and you’ll have OKR: a goal management framework invented by Andrew Grove, former president of Intel. OKR is short for Objectives & Key Results and is highly popular due to well-known organizations like Google, Twitter & LinkedIn, who were quick to adopt it in the early 2000s. OKR is often associated with large, successful tech companies, but the truth is that organizations of all sizes and across all industries have embraced the methodology.
The problem with the status quo
The status quo, both in business and personal lives, is comfortable. That’s why many people don’t quit jobs they hate, why promising startups fail to explore an opportunity, and why the “old economy” has a hard time innovating.
Businesses move out of the status quo through optimization or innovation. Whether you want to optimize or innovate, you have to keep moving forward.
How OKR can help
To get out of the status quo you need a vision. It takes an entire team to get to a desired destination. OKR makes the vision actionable for the team and builds an environment that fosters collaboration. Here’s how:
A vision needs to be broken down into objectives. OKR helps you translate your vision into annual objectives, which can be further broken down into quarterly objectives.
A vision and objectives initiate a collaboration. But to successfully collaborate you’ll need transparency and alignment. Transparency lets everybody see and share what’s going on, enabling them to find out how else they can contribute. Transparency enables alignment, reducing wasted efforts and allowing people to see how they fit into the bigger picture.
Together with a team that is inspired to give their best, moonshot visions can suddenly become reality.
How OKR inspires people
Years of psychological research has made clear that happiness and productivity are closely related. A happy team member is a productive one and vice versa. OKR can have a positive effect on employee happiness through its ability to inspire:
- OKR makes you part of something bigger
Popular advice for happiness is “be part of something bigger than yourself”. We all need a feeling of purpose. Research by Imperative shows that purpose-oriented workers are consistently “the most valuable workers”. Using OKR allows everyone to see the bigger picture and how they fit into it, increasing employee engagement
- OKR lets you progress towards a goal
For many years it was thought that giving employees recognition was the most important contributor to an employee’s joy and motivation. Harvard Business School professor Amibale found that making progress is even more important: knowing you’ve progressed towards a goal – even if it’s small – boosts joy and motivation.
- OKR creates an environment of trust
Distrust by managers results in micro-management and gives people the feeling their full potential is not being used: a huge motivation killer. No one likes to be handed out tasks. Instead we want goals and ownership, which is exactly what OKR does.
Create a habit of execution
A happy team, inspired to give their best every day, is highly productive and unlikely to leave the organization. When OKR is executed correctly, it can boost employee happiness and productivity and your company can meet its goals.
[divider]About the author[/divider]
Henrik-Jan van der Pol (left) is the CEO of Perdoo, a Berlin based SaaS company. It provides an OKR solution that helps organizations adopt and embrace the framework and fosters transparency, alignment and engagement.
Henrik will have a workshop at the upcoming HEUREKA conference. If you’re interested in learning more about how OKR can help your company, apply for a ticket now.