Google did not imagine that, with only one year of life, it would introduce a work management methodology, originally from Intel, that it has never stopped using and that, today, all companies want to incorporate.
We are talking about OKR’s. The working method that promotes organizational alignment through the achievement of common objectives and that has become a fundamental system for all members of the company to move in the same direction.
What are OKR’s and how do they work? And, most disturbingly, why are they key in companies like Google, Intel, LinkedIn or Twitter?
We will tell you!
What are OKR’s: the methodology that Google uses for its employees – R061 Introduction to the OKR methodology blog
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Since the 1950s, companies have been applying a wide variety of management techniques designed to improve employee performance. Peter Drucker introduced Management by Objectives (APO), a process in which managers and employees agree on objectives and what they must do to achieve them. 30 years later, in the 1980s, the acronym India Phone Number List and KPI’s began to gain a foothold in business management. And it was in 1999 when the concept of OKR’s was first heard from John Doerr, promoter of this methodology and directly responsible for Google’s introduction of it into its management.
Now that we know when it was born, let’s define the concept.
What are OKR’s
OKR stands for Objectives and Key Results .
We can define it as an internal work method that, by setting objectives and their corresponding key results, allows organizing the work of the company, defining work groups and monitoring the progress of each employee.
What is achieved with OKR’s? align the work of the entire organization and set a single course for all its members. Undoubtedly, an innovative method that allows defining the objectives of the company and the team and, based on the results obtained, measuring the progress of each of them.
Benefits of OKR’s
The BetterWorks company defines in its Getting Started with Objectives & Key Results (OKRs) study that OKR’s help organizations to:
Impose a feeling of commitment to the achievement of objectives.
Inform all members of what is important.
Allow more accurate communication.
Establish indicators that measure progress.
Focus effort and ensure team alignment.
In the following video, Rick Klau , partner of Google Ventures, tells us how Google has been introducing the OKR method since 1999 and the benefits that this has had for the company:
How to introduce the OKR method in your company
Surely you are already noticing the great potential of this methodology and understanding why large Forex Email List use it. We are going to explain what you can do to incorporate it into the management of your company:
First of all, you should know is that the ORK method is made up of two basic elements: objectives and key results.
Knowing this, what you have to do is ask yourself two questions that, according to Henrik-Jan van der Pol, another promoter of this method, will help you implement it with guarantees of success: Where do you have to go? and How are you going to know that you have already arrived?
You can answer the first question by setting objectives and the second by achieving key results.
The first step is to define the objectives that will show you a clear direction where to go. Having too many goals could lead to an excess workload.
These goals must be ambitious for the company and aspirational for the employees. They must also be approved by the entire organization.
Let’s take an example of objectives:
➡ Increase income
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➡ Improve the user experience on the website
Once the objectives have been set, the next step is to give them an answer, that is, define some results for each of them. Three or five results for each objective would be ideal.
These results have to make the objective measurable, achievable and limited in time and, of course, help to achieve it.
We continue with the previous example:
➡ For the goal of increasing revenue, a key result would be to close the year with 20% more revenue.
➡ For the purpose of improving the user experience on the website , a key result would be an increase in the number of clicks on the website.
To achieve the key results, we will carry out a series of actions that will be aligned with the objective we want to achieve.
Google establishes its OKR’s on a quarterly and annual basis. Every three months it defines the OKR’s, which are reviewed annually, depending on the progress made.
Once we have set the objectives and achieved the key results, how can we know if we have done it well? Well, with the characteristic scoring method of the OKR methodology.
At the end of each quarter, it is time to measure and assess the results obtained. Each employee scores their results, on a scale from 0 to 1. Ideally, get a mean of between 0.7 or 0.8 , since getting a mean of 1 could mean that the goal was not ambitious enough. A result below 0.4 indicates that the job should review its goals and how it is trying to achieve them.
All company scores are public because, in this way, all employees can see what their colleagues are working on and thus walk in the same direction.
As a summary, let’s look at a practical example to understand how the OKR method is used:
What are OKR’s: the methodology that Google uses for its employees – OKR example
Don’t confuse OKR’s with KPI’s
The OKR’s seek to set objectives with which to go one step further, that is, to get out of the current situation to reach a new, more ambitious terrain. Companies use OKR’s to get to that new point.
KPIs, meanwhile, are key performance indicators and measure the success and progress of an ongoing activity that is already running.
Although they are different methodologies, they complement each other. And it is that the KPI’s can serve as inspiration when defining the OKR’s.
For example, a KPI can tell us that we are not selling enough, so we will need an OKR to help us increase sales.
What are OKR’s: the methodology that Google uses for its employees – OKR Methodology 301×1024
The most important asset of any company is its human capital. For work synergies to exist and all employees focus on the same goal, it is necessary to establish internal management methodologies that help align the entire team. The OKR method will not only allow you to define common objectives , but also measure progress based on the results obtained and, based on this, be able to redefine more optimal strategies that guarantee the success of your company.
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