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Culture Alignment

How To Connect Employee Goals To Business Outcomes

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Chris Heron

Tuesday, March 17, 2020

Objectives & Key Results: How To Connect Employee Goals To Business Outcomes

“You do what you track. You get what you measure.” This is the quote from Peter Drucker, one of the greatest management minds of the 20th century. He was the first to recognise that there are three distinct types of workers:

• The ones that only work for their paycheck
• The ones that just want to be the best at what they do (subject-matter experts and masters)
• The ones that see business holistically and understand how their work resonates with the entire business structure (they understand the purpose).

And for Drucker, the problem was the second category— the subject-matter experts and masters. Yes, you need people who are experts in their field, but this was creating silos inside the organisation and the problems were endless because these types of workers couldn’t see the big picture.

The solution to this problem?

The goal management system called Objectives & Key Results (OKRs).

The system is so effective that early adopters were Google and Intel, it also spread to Linkedin, Facebook, Uber, Adobe, Amazon, Trello, Netflix, Spotify, Twitter, and many others.

But what exactly are OKRs and how can they help you?

What are your current business challenges and how can OKRs solve them?

Objectives & Key Results is a goal management system that measures performance by results.

An objective is a goal that the organisation, team, or individual wants to accomplish. Objectives ask the question “What do we want to do?”, are qualitative, and time-bound.

A key result is a description of how you will accomplish your objective. Key results ask the question “How will we know if we have met our objectives?”, are quantitative, and concrete.

There are only two questions that you need to ask when creating your Objectives & Key Results:

Where do I want to go (objective)
How will I pace myself to see if I’m getting there? (key results)

There are a couple of things you need to take into account when creating OKRs:

Set on a quarterly basis
One Objective needs to have Three Key Results
Not more than 3 objectives at the same time
You should aim to accomplish around 70% of Key Results

An example of a quarterly OKR would be:

Objective: Implement an email newsletter with success
Key result: Grow the subscriber list from 1700 to 5000
Key result: Increase the click-through-rate from 3% to 6.3%
Key result: Create topics and outlines for 20 email newsletters

OKRs are truly great but where they help companies the most are in the following five categories.

Five reasons why companies falter and how OKRs can save the day

OKRs are a great goal-setting framework that you use in your company no matter the size or maturity.

But there are advantages to OKRs that other goal-setting tools simply don’t have:

Prioritising goals

When it comes to OKRs, you always set a single Objective (the goal— what do we want to do) and three key results (you will you do— how will we know if we have met our objectives). This creates a clear prioritisation of what needs to be done, how it needs to be done, and who will do it.

Communicating goals in a comprehensive way

Most companies create major plans on paper and then have no idea how to communicate them to the people who will then implement — the employees. OKRs are simple, clear, and straightforward. Everyone knows what the goal is and what needs to be done to get there and we at Visibly can help you out here. Also, you have a clear metric that shows you if you hit your objective or not (hard to argue against that one).

Creating a system around your goals

Willpower and motivation are great, but unless it’s backed up by systems, it will fail. It’s the first lesson in every change management course— you can’t rely on motivation, but you can on a system.

OKRs have check-ins, commitments, and celebrations that help create a system that supports employees to accomplish the objectives.

Working on the Important instead of Urgent

The easiest way to lose strategic insight is to put your entire focus on what is urgent. But the opportunities for massive growth aren’t there— they are in the important tasks that are not urgent right away but will create massive leverage in the future.

OKRs help you distinguish between the urgent tasks (busywork) and the important tasks— the ones that help you get closers to fulfilling your Objective (moving the needle)

Quitting when you just need to iterate

Like any system, it will take a little bit of time to get things right. And that means once you hit the occasional bump in the road, you shouldn’t quit, just iterate and adapt.

OKRs are great because they work— no matter your size, industry, location, or culture— they work. And once we get into problems during implementation (support structure, the key results are too high/low), we need to adapt and learn, not close the shop and quit.

Aligned on multiple levels

The great thing about OKRs is that they can be made on different levels, whether it’s a team, division, department or the entire company. But once the main objective has been set, it needs to be cascaded down into smaller company segments, all the way down to the individual level.

That’s why OKRs are so successful— they involve top-down and bottom-up goal setting.

Most OKRs should come from team members themselves… and in companies that successfully implement them, they do (around 60%).

The manager sits down with an employee and they discuss the main Objectives if it was set by the company, and then co-created by the individuals (employees) OKRs.

The individual OKRs for the employee is the basis of the system— how can an individual contribute to the overall OKR of the company while at the same time working on the things that matter to him/her and growing the skillset.

This is why the OKRs of the team members are co-created with the manager— they work together to make sure that the goals are both personal and impactful to the individual and at the same time helping achieve the business needs (the company OKR).

A personal touch and one-on-one meetings

OKRs can involve the entire company but also just a single team. But no matter the size, the approach is still the same:

You co-create OKRs with your employees, making sure that they give you input on their needs and that you give input on the business needs of the team, department, or company.

An important aspect of OKRs are One-on-One meetings that the team leader has with its team members. They should create the individual’s OKRs on this One-on-One meetings and later on discuss problems, track, and measure progress.

Overnight success takes 10 years

You will probably have problems in the first go with OKRs— that’s just setting the right expectations. But with iterations and learning from previous experiences, you will get better at it. There are no cookie-cutter and “one size fits all” solutions— you will need to watch and notice what the employees inside of your company are reacting to and respond accordingly. It will take a little bit of time, but no success was ever made overnight.

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