Andreas Soller

Actionable OKRs

An OKR is a goal-setting framework that helps organisations to set, track and achieve their desired outcomes.

EARLY ACCESS VERSION

Reading time of this article:

5 min read (1054 words)

Publishing date of this article:

Nov 11, 2023 – Updated Nov 12, 2023, 05:59

This article is tagged as:
  • HYPOTHESIS

  • USE VALUE

  • DATADRIVEN

Objectives and Key Results (OKRs)

Objectives and Key Results (OKRs) focus on a change in user behavior as a result of your initiative.

  1. Set clear Objectives: objectives should be ambitious, inspiring, and aligned with your organization's goals. They should be qualitative and provide a clear direction.
  2. Define Key Results: Key results are specific, time-bound, and measurable. They indicate progress towards the objective. Typically two to five key results are set for each objective.

OKRS ≠ KPIs

OKRs are not to be confused with Key Performance Indicators (KPIs).

OKRs are leading indicators that express objectives we want to achieve in the future. KPIs are – on the contrary – indicators that measure the status quo of an organization. Example KPIs: turnover, labor cost.

Example objectives:

Improve customer satisfaction / user experience.
Increase product sales.
Boost employee engagement.

Key results

Key results are clear, quantifiable and directly linked to the objectives.

Let us first look at some exemplary key results that could be associated with the objectives above:

Improve customer satisfaction / user experience

* Decrease customer service response time to less than n hours.
* Resolve 80% of customer complaints within n hours.
Increase product sales

* Increase customer retention rate by n % over the next quarter.
* Improve customer satisfaction score to n% over the next quarter.
* Increase the average number of products per transaction by n %.
Boost employee productivity

*  Conduct monthly training sessions on productivity techniques.

Type of key results

Innovate

When we try to find better solutions and find clues what user problems we should focus on, we speak of explorative metrics.

Improve or build

When we have already a digital product or service launched and we want to continuously monitor our product or service we speak of reporting metrics.


Another possibility to classify metrics is by the target objective:

Growth and activation

Question: “How is the product / service / company growing?”

* monthly new users
* monthly active users
* (…)

Engagement

Question: “How do users engage with our product / service?”

* multiple logins per month
* messages sent per month
* likes / quotes per month
* views (example: YouTube) per month
* feedback (example: App store) per month 
* (…)

Retention

Question: “Do our users come back and continue using our product / service?”

* retained user
* resurrected users
* channels how they were resurrected (Example: notification, email…) 
* (…)

User happiness

Question: “How satisified are users with our product / service?”

* Number of complaints in support per month
* NPS score: how likely would they recommend the service to others?
* (…)

Takeaway

There are many different ways how we can look at key result. The important aspect is that every key result is specific, measurable and time-bound and helps us to explore or monitor changes in user behavior that give us an indication if and how our objective is / isn't met.

Key results look ahead

When it comes to concrete metrics we distinguish between lagging and leading indicators.

A lagging indicator helps to measure the status quo after something has been used. Example: On average we had 15 support calls per month last year.

A leading indicator is focusing on activities that result in a future change. It is about predictions and measuring change. We ask where something will lead to. Example: We learn from research that opening our newsletter increases sales.

Opening our newsletter is our leading indicator. We can test this assumption by adjusting our newsletter, offering additional vouchers or making it easier for our users to enter the voucher. With each identified opportunity we want to change the behavior of our users to open the newsletter more frequently.

Let's say we believe that adjusting the newsletter will have the biggest change on user behavior. Therefore we run a test if this assumption is correct. We measure how many adjusted newsletters are opened and if an increased number of opened newsletters increases sales.

Depending on the maturity of the product and the knowledge we have already gathered about our users we will include additional granularity to our metrics. We might for example say, that we want to increase opening of newsletters by 3%.

Takeaway

Key results are designed to be forward-thinking and predictive, setting a path for what needs to be achieved in a specific timeframe to reach the given objective.

How to write good OKRs?

The Objective

  1. includes the persona
  2. for whom we create value,
  3. it is inspiring and
  4. therefore, makes an impact for your organization
  5. but a good objective remains achievable in the time-frame
What do we want to achieve?

VERB + AMBITION / OUTCOME + WHY

We will create a great workspace for our organization to become one of the top 10 employers in market n.

We will expand our social media for our customers towards a community where they can benefit from each other.

We will increase the usage of product n for segment m by becoming a highly recommended (something) platform.

2–5 Key Results

  • are leading indicators,
  • that are continuously monitored
  • to see if the objective will be achieved.
  • Each Key Result addresses
  • a different quality of the objective.

It it is important that we measure changes in user behavior (outcomes) that will help to reach the objective.

INDICATOR how VARIABLE will INCREASE / DECREASE until DATE.

Our customers will file 10% less support tickets per month until…

We will resolve user incidents 10 % faster until…

We will reduce the time to login to our platform for our external users to 1 minute.

We will score 20% better at the System Usability Scale survey next quarter.

Key takeaways

Objectives and Key Results (OKRs) are a goal-setting framework that helps organizations set ambitious goals with measurable outcomes.

Objectives should be inspiring, ambitious, and aligned with the organization's goals. They are qualitative and provide clear direction. Examples may include improving customer satisfaction, increasing product sales, or boosting employee engagement.

Key results are specific, time-bound, and measurable indicators of progress towards the objective. Typically, two to five key results are set for each objective. They could include metrics like decreasing customer service response time, increasing customer retention rate, or conducting monthly training sessions.

Key results can be classified into different categories like growth and activation, engagement, retention, and user happiness. Each category answers specific questions about the product or service, such as how satisfied users are.

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