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9. Setting Up OKRs | Link Technology to Your Long-Term Business Goals: How to Use Technology to Mobilize Your People, Strate…

© The Author(s), under exclusive license to APress Media, LLC, part of Springer Nature 2022
Praz, Link Technology to Your Long-Term Business Goals
https://doi.org/10.1007/978-1-4842-8208-3_9

9. Setting Up OKRs

Praz1
(1) Bangalore, Karnataka, India
Before you introduce OKRs into your business, it’s important to under-
stand how to induce change into how the team functions as a whole. OKR
thinking requires a change to be organic and should then percolate up to
everyone working with you. Once the thought becomes an inherent
process, writing and executing OKRs becomes easy. As a result, achieving
business goals will become process driven rather than being rote.

Defining OKRs

The following steps show how you can change the thought process of the team to
start using OKRs:

1.Every OKR rollout must have a sponsor. The sponsor is usually the
CEO or the head of the function, depending upon at which level you
introduce OKRs. Some organizations like to do full-scale organiza-
tion-wide rollouts, with the rest of the OKRs for select business
groups or functions. The sponsor must make OKRs a conversation in
leadership meetings, townhalls, and reviews. The sponsor must par-
ticipate in setting the OKRs as they are the most important growth
metrics.
2.Using OKRs is about bringing in consistency. Teams that are using
OKRs must understand what they are, how OKRs are different from
individual performance practices, and how the team writes and
tracks OKRs. Teaching the fundamentals of OKRs can be done by in-
ternal coaches or external OKR coaches who are certified and
trained on how to enable teams.

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3.The sponsor and their team must be involved in setting the North
Star OKRs for the rest of the teams to align with. If departments are
using OKRs, then the department heads, leaders, and next-level team
leads set the North Star OKRs. Remember in OKRs, less is always
more. So, define no more than three objectives and three to five key
results each.
4.The cross-functional team members come together to move the nee-
dle on the North Star metrics.

These four steps will enable teams to collaborate effectively to achieve

the objectives of the organization.

For example, let’s say your North Star metric is to reduce dropout rates
of a prospect exploring your website. Why? The intent, of course, is to
have as many prospects as possible to select a plan and click Get Started
or to contact your sales teams to start the onboarding process. We all
know how important this is for revenue generation.

But the business team can’t do this alone; it needs to collaborate with
the technology team. Let’s give this cross-functional team a fancy name:
the growth warriors.

Growth Warriors

The growth warriors have representation from the sales, marketing,

product, and engineering departments. They need to solve a focused
problem, which is “How do you reduce dropout rates from 70 percent to
40 percent in the next 90 days?”

The growth warriors start by listing the existing challenges, which come in the
way of achieving OKRs. Here are some examples:

“We have no clear way of knowing who is visiting our website.”

“The content or its placement is not engaging enough.”
“We are not tracking the response time to those who place queries in
the chat window.”
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“We do not have enough bandwidth, and there seems to be just too
many requests coming to the tech teams.”

The warriors set their objective statement after much deliberation:

Deliver a kick-ass experience to prospects on our website to reduce dropout

rates.

The clear business value is to reduce dropout rates. The next step then is how to
measure this. That’s where the following four key results (KRs) come in. They are
the metrics that help determine if the inspirational objective has been met.

KR 1: Reduce response rates to prospect queries from two days to ten

minutes.
KR 2: Increase the average time spent on the website from one minute
to three minutes.
KR 3: Reduce page load time from three seconds to one second.
KR 4: Reduce dropout rates from 70 percent to 40 percent.

Each team is aligned as an owner to a specific KR and starts their

work. No matter what the team does, the goal is to ensure customer satis-
faction by working on these four KRs. Each team member focusing on
their objective through the KR will ensure that the objectives are driven
in a customer-centric manner.

OKR Grooming

If you ask a Google employee, or Googler, about OKRs, you will often get
the response that “it’s how we do business here.” That’s how ingrained it
is in Google’s culture.

OKRs require conditioning teams to accept managing by outcomes

rather than managing by activities. Oh sure, activities are important, but
ticking off feature builds, calling prospects, and meeting a partner will
not move the business forward. These are the inputs, but the goal is to
move on the outcome metrics. This is similar to growth warriors measur-
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ing reduction in turnaround time or making a prospect stay longer in

their digital store.

Teams need to understand that OKRs require selecting the right metric
and not the easy-to-achieve metric. This mindset requires one to stretch
their abilities.

OKRs require a cross-functional collaborative mindset. The teams

write the OKRs together and not in isolation or water-tight departmental-
ized structures, which plague many companies even today.

Grooming is also for leadership team members. The command-and-

control style of management is a deal-breaker in introducing OKRs. Here
you are asking our teams to select metrics that can impact the business.
The directive style should be replaced by a coach-led exploratory style,
which encourages teams to select OKRs and experiment.

Ultimately, what you expect out of OKRs as an exercise each quarter is the
outcome. The OKR framework as an outcome-based tool will help drive a team’s
actions every day (Figure 9-1).

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Figure 9-1 OKR as an outcome-based tool

Summary

Because of how flexible the OKR framework is, you can write OKRs in a
variety of ways. Like any goal, OKRs should be verifiable and measurable.
You should think of OKRs as the pillar of your strategy for the next period
of time. However, to set good OKRs, you also need to connect them to
your day-to-day work.

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