9 out of 10 organizations failed to execute their strategy.
Now Objective and Key Results is a great framework for strategy execution.
Within Uffective we have implemented a very user-centric and simple approach to set-up and track your OKR implementation.
Back in 2005 Kaplan and Norton found, that 9 out of 10 organizations failed to execute their strategy. Reasons for that being that 95% of employees do not know or do not understand their organization strategy and how they can make sure that whatever they are doing is helping to realize that strategy. In addition, 45% of managers could not even name one of their organization’s top priorities.
Now Objective and Key Results – or short OKRs – is a great framework for strategy execution.
It became very popular ever since Google implemented it in 1999 and combines previous research on Management by Objectives (P. Ducker), S.M.A.R.T criteria (George T. Doran) and the Balanced Scorecard methodology (Kaplan and Norton).
- An OBJECTIVE
gives direction on WHAT should be achieved. Objectives are ambitious, motivating, big hairy goals. Objectives that are ambitious but not 100% achieved create more impact than 100% achieved non ambitious objectives. Objectives normally hold 3 to 5 Key Results.
- KEY RESULTS
are specific measures used to track the achievement of an Objective within a specified timeframe. They are measured in %, currency, days or in any scale (0-10, 0-100, etc.).
The power from OKRs come from 4 topics: (1) Focus, (2) Align, (3) Stretch and (4) Track. So OKRs help your team to focus on the most important topics and to align the work amongst colleagues. It expects stretched goals and you must track the progress against those goals.
Within Uffective we have implemented a very user-centric and simple approach to set-up and track your OKR implementation. Each user sees his personal OKRs on the Uffective SMART-Start. There is no longer any need to manage your OKRs using spreadsheets or text editors.
To get started fast and to avoid the waterfall approach, we advise not to wait until a hierarchy of OKRs has been agreed upon. Senior management should rather open-up their OKRs and staff can view, subscribe, and create their own OKRs (actually, the OKRs of everybody should be opened).
Simply select a pre-set parent OKR to which our O (Objective) or KR (Key-Result) relates to and you are ready to go to create your own OKR set.
Depending on your company’s governance you or your manager can assign existing OKRs to entire workgroups by selecting team-members to an Objective or to a Key-Result. By subscribing members of your team to e.g. Key-Results, these items will appear on the team-members Uffective SMART-Start, so the colleagues can plan their daily work with their impact on Objectives in mind.
But that is not all. Uffective comes with three additional features, which further strengthen the impact of your OKR implementation.
1. Many of our customers are using agile methodologies in project management. A very popular feature within agile is the measurement of an PI Objective by “business value and achieved value”. So, we decided to also use this logic in Uffective OKRs. The achievement of each Objective or Key-Results can be measured by assigning Business Value and Achieved Value points on a scale from 0-10.
2. We also established a way to link your OKRs with existing KPIs in the organization. Key Performance Indicators are the established set of business drivers, which your company aims to achieve in a certain timeframe like revenue or EBITDA for the current fiscal year.
OKRs can be mapped to existing KPI sets which makes the current activities executed by the teams through key results (OKR) and their impact on key performance indicators (KPI) transparent.
3. Really exiting is the third feature that allows you to combine existing knowledge in Uffective on user stories, ToDos and projects to the OKRs. In this way Uffective creates transparency on the activities going on to deliver the OKRs as well as indications on the budget allocated to it.