Leveraging Data from OKRs to Drive Business Results
Are you measuring the right KPIs? Are your employees engaged and involved in setting and meeting these goals? Gtmhub's Seth Elliott offers practical advice.
- By Seth Elliott
- June 1, 2020
Measuring results is key to business success, but how can you ensure you're measuring the right things, that your metrics are in line with C-suite goals, and that your employees are engaged in meeting these goals? Seth Elliott, chief marketing officer for Gtmhub, suggests several best practices.
Upside: We know that measuring objectives and monitoring key performance indicators (KPIs) are important to drive business results. What are the biggest mistakes enterprises make when tracking these measures?
Seth Elliott: KPIs are impactful drivers of business results because there is no "faking it" when it comes to tracking objectives and key results (OKRs). Teams and individuals either reach their goals or don't, and when goals are not met, the bright side is that those teams now have evidence that can help to identify the gaps and inform better performance in the future. Because there is no faking it in the results, don't try to fake it when setting goals, either. Goal setting is meant to help employees think bigger and better, and that doesn't happen if you set easily attained or expected goals just for the sake of appearances.
One of the biggest mistakes enterprises can make when tracking OKRs -- other than not focusing on the best measures -- is having a set-it-and-forget-it mentality. Goals need to be revisited regularly, not just every quarter or year, in order to identify what's working and pivot strategies as needed. The ideal cadence for checking in on OKRs should be weekly.
What are the key components of OKRs? How does tracking OKRs differ from other goal-setting methodologies?
OKRs (objectives and key results) is a goal management methodology that is highly effective for ambitious, high-growth enterprise companies. OKRs were invented at Intel in the 1970s during a time when the company was shifting away from its role as a memory company to a microprocessor company. It created the OKRs system to enable employees to set priorities. John Doerr, who had been working for Intel at the time, later brought OKRs to the famous VC firm Kleiner Perkins Caufield & Byers and suggested that a number of portfolio companies use the approach, most notably Google, where OKRs grew in popularity.
The key components of OKRs are, simply put, the objective, the key result, and the tasks needed to achieve them. The objective is qualitative and identifies the goal, whereas the key results are quantitative and represent the measure of success.
Tasks are the final piece to the OKR puzzle and they outline specific steps needed to achieve the OKR.
Although there are no exact alternatives to OKRs, there are some similar methodologies, such as balanced scorecard, MBOs, and KPIs, as mentioned earlier.
Is there a way that enterprises can use data from OKRs to address that gap between the goals determined in the C-suite and actions of employees throughout various teams and departments in the company?
OKR data is extremely useful in providing insights into how the actions of employees play into and support the overall goals -- set to achieve a certain bottom line -- from the C-suite. That said, it can be time-consuming, especially if teams are having to manually go into a spreadsheet and update the progress they've made before each check-in. As a result, automating OKR data is an effective way to ensure enterprises can use data in real time to address gaps across their organization.
Tracking OKR progress in real time and having your collaboration and communication practices backed by data will help managers keep their finger on the pulse while enabling employees to work towards their own goals. Additionally, tools like dynamic key results, which regularly adjust based on monitoring the progress to a goal using automation, are illuminating for companies looking to address the gap between the goals determined in the C-suite and employee actions.
What best practices can help enterprises avoid problems?
Gaps in communication happen, but to try to avoid them, companies should focus on prioritizing team and individual alignment, transparent messaging, and employee engagement and commitment. With these priorities apparent through an organization, employees will feel more connected to key goals, which helps to mitigate gaps in understanding and motivate good performance. For example, using an automated platform to track OKRs enables automated progress measurement, which then collects data on and leads to an increase in productivity.
If it's not the right time for your company to invest in OKR software, the methodology alone is effective for solving gaps between the C-suite and employees. Consider the advantages: objectives are qualitative and aspirational, and key results are quantitative (and guided by actionable analytics). Successful companies are able to connect qualitative objectives to quantitative key results.
What tips can you offer for setting objectives and KPIs? For example, how do you specify measures for things that can be difficult to assign a solid numerical measure to?
When starting from square one, it's important to gather a group of experts to determine the highest-leverage goals for an organization to focus on. After all, the goal of the OKR method is to figure out what matters most, so getting together a group of leaders -- and not just relying on one perspective -- is essential to identifying the right goals and also scaling them effectively.
It is also important to be open to different strengths and styles among coworkers, so if some share better in groups whereas others require a quiet setting to share their thoughts, it's important to provide outlets for all means of participation in order to develop the most well-rounded goals.
Measurement and tracking can help a business achieve better bottom-line results, but you've said that they can also improve employee engagement. How do they do this and how do you measure that engagement?
To improve workplace performance and achieve better bottom-line results, organizations need to hone in on the crucial connection between employees and their environments -- and that starts with data. To support employees in being engaged and productive, managers can use OKRs to determine clear responsibilities for teams and individuals that allow employees to prioritize their time, delegate, track task progress, and stick to deadlines. Every teammate should be aware of not only their responsibilities but also their peers' as well as the overall goals of the company, which is why transparent communications are crucial.
Bottom-line results are top of mind for a business's leaders, but it's essential for managers to remember that although monitoring productive task completion is important, the broader goal is to do what their title suggests: manage. Effective management requires leaders to keep the bigger picture of employees' engagement and satisfaction in mind.
Who should be involved in setting and measuring objectives?
Here's the thing about OKRs (and part of what makes the methodology so successful): by allowing employees to participate in decision making at the most basic level, managers enable employees to be more invested in their tasks and the goals they are working toward. Setting bottom-up goals for the company and empowering employees to set their own goals is an effective way to give individual employees the tools to chart their own path while also aligning with the larger company initiatives. Employees who feel caught up in their granular daily tasks reap benefits from setting their own goals to highlight the meaning of their daily work. As a result, they'll be able to use OKRs as both a "personal road map" and a means of connecting with the organization's mission.
Seth Elliott is the chief marketing officer for Gtmhub. With over 20 years as a founder or senior executive of growth and middle-market enterprises, Elliott has experience accelerating corporate growth in diverse markets on behalf of a variety of companies in multiple industries through economic conditions ranging from boom to bust, developing a rare combination of experience, vision, leadership, and business intuition.