04.12.2024 - Business Strategy

The Ultimate Guide to Setting OKRs [With OKR Template]

Transform your approach to goal-setting by adopting an objectives and key results framework designed to enhance team alignment, drive focus and boost your success. If you feel that your business objectives are missing some much-needed clarity and cohesion to make them a reality, this proven method could be just the ticket.

In this article, we’re providing our ultimate guide to OKRs, including their purpose, the step-by-step process for implementing OKRs in your business and the most common mistakes to avoid.

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What are OKRs?

OKRs, short for objectives and key results, are a goal-setting framework originally pioneered by John Doerr for setting and tracking measurable goals. The framework can be used by businesses and is broken down into two components, the first of which is setting objectives and the second is the metrics for key results.

Objectives represent the things you want to accomplish and provide your team with direction based on the targets you want to go after. They should be clear, qualitative, ambitious and inspiring to encourage meaningful action.

Key results detail the specific and measurable outcomes and can created based on how you intend to achieve the objectives set. These are quantitative and monitor your progress towards the objectives, normally with clear metrics or milestones.

Why are OKRs important?

OKRs help establish simple goals and provide a clear direction for teams and individuals to follow. This enhanced clarity keeps everyone focused and ensures efforts are aligned on common goals for the business.

The process of defining key results encourages measurable outcomes, allowing you look at your progress tracking from a different perspective. This not only helps you assess your performance, but it also highlights where there could be room for improvement.

woman stood in front of board with notes

Implementing OKRs also promotes greater accountability as each team is responsible for delivering on their specified key results. This encourages teams to take ownership over their progress and can increase motivation, engagement and drive among employees.

The regular review cycle associated with OKRs facilitates timely feedback and discussions. These reviews – often occurring quarterly – provide opportunities for teams to reflect on achievements, share key discoveries and adjust strategies as necessary to stay on track.  

A step-by-step guide to setting OKRs

Let us guide you through the steps to set actionable OKRs that will lead your team to success from defining the objectives to monitoring your progress.

Step 1: Define your objectives

The first thing you need to do is define your objectives. Clearly articulate your goal using action-oriented and aspirational language to inspire and motivate the team. Focus on the measurable outcomes you want to achieve rather than the specific activities or tasks involved in creating the results you’re seeking – those will come later. Aim to establish between 3 to 5 objectives for various teams and levels across the business.

Step 2: Create key results for each objective

For each objective, list your key results using specific, measurable and timely metrics. These key results can include both quantitative and qualitative measures, so long as each result is accompanied by a clear target for success. Assign a single owner to each objective to ensure accountability for progress towards these goals.

For example, if your objective is to become an industry leader, one of your key results could be to increase market share by 5% each quarter.

Step 3: Review & adjust your OKRs

Once your OKRs have been drafted, you can start refining them. At this stage, it’s important to make sure your objectives are both ambitious and achievable, and that your key results can be measured with clear targets. 

During your evaluation, it can also be a good idea to seek feedback from key stakeholders and team members. Their input can help you revise your objectives and key results, along with having some extra time to adjust based on changing priorities.

Step 4: Communicate your OKRs to relevant teams & individuals

Young businesswoman having a discussion with her colleagues in a boardroom

Communicate your OKRs to all relevant teams and individuals and ensure everyone knows how their work will contribute to the objectives. Keeping the lines of communication open allows the team to ask any questions and develop a better understanding of how the process works. Since OKRs are collaborative, this step is essential to their success.

In addition, good communication around your OKRs means that successes can be celebrated, and problems can be quickly identified and learnt from.  

Step 5: Track your progress

Once you have your OKRs set up for the financial year, you can focus on monitoring team progress as you work towards them.

OKR tools or spreadsheets can be used to keep track of advances towards your goals. With this visibility, you can easily review progress at regular quarterly check-ins, address any issues and make adjustments as needed.

Common mistakes to avoid when setting OKRs

The top and bottom of it is that if your OKRs don’t align with your business goals, you’re wasting valuable time and resources in creating them in the first place. Here, we’ll be highlighting some of the common pitfalls businesses encounter when setting OKRs to make sure you avoid them.

Overloading the OKR system with too many goals

Piling lots of goals into your OKR system might seem like the best way to improve your business, but this can actually do more harm than good. Aiming to meet too many goals might mean that you meet fewer than you’re capable of during a quarter or financial year, not to mention that it can skew the focus of your teams and cause confusion.

Setting vague or unmeasurable objectives

Providing clarity in your objectives is the best way to ensure that teams understand why they’re being set and what can be actioned to achieve these goals.

Try to avoid using phrases like ‘improve performance’, ‘enhance teamwork’ or ‘increase customer satisfaction’ without any specific criteria or measurable outcomes. This can make it more difficult for teams to determine what success looks like or how it can be achieved.

Lack of alignment between teams

OKRs should be aligned with the company and team strategies to help clarify the areas that matter most. Clear alignment among teams fosters collaboration and progress, while misalignment can lead to confusion and missed opportunities.

The OKR process should be collaborative and encourage input from all team members. This approach not only strengthens team commitment but can also lead to more relevant and achievable key results being used within your OKRs.

Examples of OKRs

Need some inspiration to help you come up with objectives and key results that will produce the outcomes you’re after? Check out our collection of examples below. 

Objective 1: Enhance your online presence and engagement

Key results for enhancing online presence and engagement include:

  • Increasing quarterly web traffic by 20%
  • Improving social media engagement with specified targets for likes, shares and comments for a period
  • Building quarterly conversion rates for email marketing by 10%

Objective 2: Drive employee engagement

Key results for driving employee engagement include:

  • Achieving 90% participation in monthly update meetings
  • Boosting employee satisfaction scores by 20% in annual surveys
  • Increasing the availability of employee development opportunities by 2x

Objective 3: Increase lead generation from your digital marketing strategy

Key results for increasing the number of leads gained from your digital marketing strategy include:

  • Increasing your content marketing budget by 2% each quarter
  • Push two pieces of gated content each quarter
  • Enhance 15% of website copy to align with the needs of your target audience

Download your OKR template

Take control of your goal-setting with our comprehensive and user-friendly template designed for creating and monitoring effective and measurable OKRs. Our free, downloadable template offers businesses a simple, structured approach so you can clearly define your goals and track your progress with ease.