Organizations need a robust methodology for setting and monitoring goals. There are plenty of frameworks to choose from, including KPIs, OKRs, and SMART goals.
So, how do you choose?
In this guide, we’ll examine what OKRs are, how they work, and why they’re vital for businesses. Then we’ll show you how to set OKRs for various departments and teams, including real-life examples. Plus, we’ve even got an OKR template to get you up and running.
What are OKRs?
OKRs are a framework for setting business goals, developed by Andy Grove for Intel back in the 1960s. The acronym stands for objectives and key results, which might give you an idea of how the framework plays out.
OKRs help companies to:
- Identify key business objectives
- Set realistic targets
- Determine timeframes for achieving those targets
- Ensure that goals are related to overarching business objectives
It’s also important to clarify what the OKR framework does not do:
The OKR methodology is not designed to help your company determine your overall vision for the business, your fit in the marketplace, or the long-term direction of business development.
Rather, the organizational OKR process assumes you already understand these elements and helps you take that high-level vision for company progress and build out realistic, tangible organizational goals.
How do OKRs work?
OKRs consist of two components — the objective and the key result or results.
The objective is the goal you’re looking to achieve. It’s not a numerical or quantifiable goal — at least initially — but tends to be a high-level aspiration that begins with a verb, such as:
- Increase sales volume
- Improve speed to sale
- Reduce employee turnover
The key result aspect of a team OKR is where you get into the details, breaking down that big hairy objective into more tangible, realistic, measurable results. For example, if your objective is to “Increase sales volume”, then key result examples might be:
- 50% lift in new lead generation
- 20% more sales revenue this quarter
- 10 new deals closed above $100k
Why is setting OKRs vital for your business?
OKRs can help you achieve your business goals. Having goals is one thing, but having a system or framework in place to execute and measure those goals is the key differentiator.
In the words of Larry Page, co-founder at Google:
OKRs have helped lead us to 10X growth, many times over. [ … ] They’ve kept me and the rest of the company on time and on track when it mattered the most.
Setting OKRs helps you:
- Articulate your goals. An OKR should be a concise, action-oriented, meaningful, and inspirational statement.
- Track and measure progress. Regularly record how you are progressing toward your key results.
- Reassess and stretch. Evaluate if you reached your goals and adjust accordingly, typically every quarter.
Makes sense in theory, right? But how do you actually create a good OKR?
What are good OKRs?
Good OKRs consist of goals and intents with time-bound and measurable milestones. With both components in place, you’re good to go.
For example, Google has an OKR to improve sustainability:
- Objective: Design processes that eliminate waste and pollution and give products a longer life so they don’t need replacing often.
- KR1: Build “All Made by Google” products (after 2020) with recycled materials.
- KR2: Use recycled or renewable material in at least 50% of all plastic in all our hardware products by 2025.
- KR3: Make our product packaging 100% plastic-free and 100% recyclable by 2025.
How to avoid common OKR mistakes
While setting good OKRs is vital for your business, there are some pitfalls to avoid:
- Creating unachievable objectives — set objectives that are challenging but achievable.
- Setting only top-down objectives — set a mix of top-down and bottom-up goals.
- Allocating inadequate resources — ensure employees have the proper resources to achieve the objectives.
- Creating vague OKRs — set time-bound, measurable goals.
- Not tracking progress — monitor and discuss progress regularly.
- Confusing OKR goals with daily tasks — use a work management system to track progress.
- Setting only aspirational or operational goals — strike a balance between both types of objective.
- Having too many or too few objectives — typically, 3-5 objectives are sufficient, but evaluate each quarter.
Still not quite sure how to go about setting an OKR goal? Let’s explore a few example OKRs to give you some clarity on how this process plays out for each business department.
Setting Company OKR examples
Typically, when you’re setting company OKRs, you’re not really setting OKRs at all.
Instead, you’ll set the company objective — or objectives — which will then filter down into individual OKRs for each different department.
Let’s look at three examples of how you can further refine a company goal into objectives for different teams in your organization.
Objective 1: Increase revenue
- Sales team objective: Lift monthly sales revenue.
- Product team objective: Improve access to advanced features to further embed our product in customer workflows.
- Customer service team objective: Improve customer retention.
Objective 2: Increase market share
- Sales team objective: Increase average deal size.
- Marketing team objective: Improve brand awareness.
- Product team objective: Improve user experience by implementing competitor features.
Objective 3: Reduce operating costs
- Admin team objective: Improve supplier payment process to reduce late payment fees.
- Marketing team objective: Reduce the cost of marketing spend.
- HR objective: Reduce labor costs via company restructuring.
Now, let’s investigate how we can turn each of these team objectives into an actionable OKR example.
Setting Sales OKR examples
Sales team objective 1: Lift monthly sales revenue
- Key result 1: Increase the number of closed deals from 400 to 600
- Key result 2: Increase average subscription value to $750 per month
- Key result 3: Lift demo to close rate from 50% to 60%
Sales team objective 2: Increase average deal size
- Key result 1: Lift average subscription value to $900 per month
- Key result 2: Adjust lead scoring parameters to prioritize larger deals
- Key result 3: Increase the percentage of high-value leads generated from 20% to 30%
Sales team objective 3: Speed up deal velocity
- Key result 1: Hire 5 new salespeople to ensure new leads are tended to promptly
- Key result 2: Adjust email outreach campaign from 7 steps over 32 days to 6 steps over 24 days
- Key result 3: Reduce average days to sale from 66 to 54
Setting Marketing OKR examples
Marketing team objective 1: Improve brand awareness
- Key result 1: Obtain 10 new earned placements in media outlets
- Key result 2: Publish 5 new blog posts to drive 3000 new unique website visitors
- Key result 3: Increase the number of page one search results from 14 to 22
- Key result 4: Lift the awareness score for our brand from 42% to 60% in our demographic
Marketing team objective 2: Reduce the cost of marketing spend
- Key result 1: Halt all TV advertising campaigns
- Key result 2: Reduce team headcount from 10 to 8
- Key result 3: Reduce content writing budget allocation by 10%
Marketing team objective 3: Uplift the number of new leads generated
- Key result 1: Increase the number of new leads per month from 1200 to 1600
- Key result 2: Double paid social media spend from $10,000 to $20,000 per month
- Key result 3: Review the top 100 ranking pages and blog posts on our site and ensure each has a relevant and persuasive CTA proposition
Setting HR OKR examples
HR objective 1: Reduce labor costs via company restructuring
- Key result 1: Reduce the monthly cost of wages by 20%
- Key result 2: Layoff 20 employees
- Key result 3: Identify 3 redundant management positions
HR objective 2: Improve employee engagement
- Key result 1: Achieve a weekly employee satisfaction score of 4+ over 90 days
- Key result 2: Launch a 360-degree feedback initiative and achieve a 50% response rate
- Key result 3: Hold a company lunch event once per month
HR objective 3: Reduce employee turnover
- Key result 1: Reduce employee churn rate from 10% to 5%
- Key result 2: Lift employee satisfaction score to 4+ for all employees
- Key result 3: Ensure all employee salaries meet or exceed market averages by position and industry
Setting Product Team OKR examples
Product team objective 1: Improve access to advanced features to further embed our product in customer workflows
- Key result 1: 10% increase in the use of identified advanced features
- Key result 2: Inform the marketing team to develop a current customer-facing campaign that highlights the benefits of identified advanced features
- Key result 3: Review GUI design to prioritize the use of advanced features and make them more accessible
Product team objective 2: Improve user experience by implementing competitor features
- Key result 1: Perform a competitor and gap analysis to understand the features our product is missing
- Key result 2: Create a development roadmap for implementing new features
- Key result 3: Implement 50% of competitor features within 12 months
Product team objective 3: Increase the speed of product bug resolution
- Key result 1: Reduce average time to resolve bugs from 33 to 26 days
- Key result 2: Hire 2 new employees to focus solely on resolving product bugs
Setting Admin OKR examples
Admin team objective 1: Improve supplier payment process to reduce late payment fees
- Key result 1: Delegate supplier payment to a single admin assistant to streamline the process
- Key result 2: Set up an automated reminder system to ensure suppliers are paid before the due dates
- Key result 3: Achieve a $0 late payment fee rate for 3 consecutive months
Admin team objective 2: Ensure the office is a desirable place to work
- Key result 1: Launch an employee feedback campaign and receive a response from 80% of the staff
- Key result 2: Solve top 5 identified problems
- Key result 3: Hold one employee lunch each month
Admin team objective 3: Improve company documentation management
- Key result 1: Design folder hierarchy structure and have all 5 teams agree to use it
- Key result 2: Collect positive feedback from 90% of users
Setting Design OKR examples
Design team objective 1: Show that our design company is a desirable place for new employees to work
- Key result 1: Win 3 design competitions
- Key result 2: Conduct monthly design meetups
- Key result 3: Receive 50 new applicants each month
Design team objective 2: Launch a new landing page to drive conversions
- Key result 1: Test 3 landing page options on 150+ external users
- Key result 2: Launch new page by March 20
- Key result 3: Conversion rate lift from 20% to 30%
Design team objective 3: Improve visual aspects of our content marketing initiatives
- Key result 1: Conduct a content audit to identify areas for improvement
- Key result 2: Hire a designer dedicated to internal company initiatives
- Key result 3: Increase shares of social content by 20%
Setting Customer Service OKR examples
Customer service team objective 1: Improve customer retention
- Key result 1: Reduce call waiting time to less than 5 minutes
- Key result 2: Reduce churn rate from 10% to 5%
- Key result 3: Hire 3 new customer service reps to solve customer issues more rapidly
- Key result 4: Implement weekly product training sessions to upskill customer service employees
Customer service team objective 2: Lift customer satisfaction
- Key result 1: Receive 2000 responses to the customer satisfaction survey
- Key result 2: Identify 5 key areas for customer service and product improvements
- Key result 3: Hold phone interviews with the top 100 customers
- Key result 4: Interview 20 recently churned customers
Customer service team objective 3: Improve support ticket resolution speed
- Key result 1: Reduce average days to solve from 10 to 7
- Key result 2: Implement a new Helpdesk ticketing system
- Key result 3: Hire 5 new customer service team members
How monday work management helps with setting OKRs
So, you’ve got a good grasp on how to create OKRs for each department in your business, and you’ve got a few good OKR examples under your belt to get started with.
The question is, where to next? Once you’ve written out those OKRs, what do you do with them? And, most importantly, how do you track progress towards achieving the key results you’ve identified?
From setting goals to navigating projects objectives, monday work management offers an organized and collaborative way of working with timelines, dashboards, workdocs, and more.
You can establish your company and team-level goals and objectives based on business priorities and needs, and design your unique OKR tracking board around your workflows.
Let’s take a look at how high-performing teams manage, track, and achieve their objectives and key results using our pre-built OKR template.
Inside, you’ll see three different groups, one for each of the company’s objectives:
- Objective 1: Launch Android version
- Objective 2: Grow the company 2x bigger
- Objective 3: Become a socially responsible organization
Each of these objectives has three measurable key results, which you can track using the following column types:
- People: If there’s a specific team member responsible for achieving this key result, you can tag and display them here.
- Priority: This column allows team members to prioritize specific key results over others.
- Status: Using this column, everyone can see where a given key result is at — whether it’s done, being worked on, or shifted to the next quarter.
- Results: This column gives teams a numerical representation of the percentage completed for each result.
- Timeline: If your key results are time-bound, you can display this information here.
In short, monday work management brings transparency, ownership, and organization to your OKRs. With our drag-and-drop functionality, it’s easy to shift things around if your goals change, and our advanced reporting helps you keep an eye on progress.
More monday Work Management use-cases:
FAQs
Here are three frequently asked questions about setting OKRs.
What does OKR stand for?
The acronym “OKR” stands for Objectives and Key Results.
It’s a goal-setting methodology that can help teams and individuals set challenging goals with measurable results. You define what you want to achieve and what milestones you’ll need to meet to accomplish it. OKRs help you track progress, create alignment, and encourage engagement around measurable goals in your organization.
How do you grade OKRs?
At the end of each milestone, you grade or score an OKR based on whether the KR was met. You can use a basic “yes/no” assessment, a number score, or a “traffic light system”.
Typically, you grade OKRs on a scale from 0.0 to 1.0, where 1.0 means complete, like this:
- Red – We failed to make real progress: 0.0 to 0.3
- Yellow – We made progress but fell short of completion: 0.4 to 0.6
- Green – We delivered: 0.7 to 1.0
How many OKRs should I set?
You can set any number of OKRs, but typically 2-3 objectives, each with 3-5 corresponding key results, work well.
For larger organizations, you may have multiple levels of OKRs that cascade down to each department, team, and individual — as per the examples above. But for smaller organizations, you may only have one set for everyone to share.
OKRs empower your team to incrementally achieve company goals
Remember, the OKR framework is not designed to help you understand what your company’s overarching vision should be.
Instead, you should use OKRs to take that high-level vision, translate it into team-specific objectives, and then dig down even further, creating specific, measurable key results that move the needle of the larger objective.
Ready to get started creating and tracking team OKRs? Why not check out our OKR template — no need to google OKR examples — it’s ready and waiting for you!
