Image courtesy of myrestoredhealth.com
Every small business owner knows that goal setting is a key to success. We all know why we need to set goals but the how is where we get hung up. And that’s where Google comes in. Their system of Objectives and Key Results (OKR’s) provides an excellent framework for goal setting and measuring. Here’s a brief intro to the method.
In the first year of Google’s operations, John Doerr, big-time venture capitalist and entrepreneur, presented the idea of OKR’s to the founders. He committed them to a test run and now it’s become part of the company culture. In explaining, I’ll use his original example of a pro football team.
The model goes as follows:
PERSON/AREA RESPONSIBLE
OBJECTIVE
Key Result #1
Key Result #2
Etc.
Example:
GENERAL MANAGER of PRO FOOTBALL TEAM
MAKE $ FOR OWNERS
Win Superbowl
Fill Stands to 88%
HEAD COACH
WIN SUPERBOWL
200 yd passing attack
No. 3 punt return avg
PUBLIC RELATIONS
FILL STANDS TO 88%
Hire 2 colorful players
Get media coverage
Highlight players
And the list would go on to the newest and least experienced employee. Each OKR is in some way related to the higher level OKR’s of the company or others from related areas within the business. They all should have some sort of tie that leads to the biggest objectives of the company
Here are a few keys to OKR’s from Rick Klau, partner at Google ventures:
- “Objectives are ambitious, and should feel somewhat uncomfortable”
- “Key Results are measurable; they should be easy to grade with a number (at Google we use a 0 – 1.0 scale to grade each key result at the end of a quarter)”
- “OKRs are public; everyone in the company should be able to see what everyone else is working on (and how they did in the past)”
- “The “sweet spot” for an OKR grade is .6 – .7; if someone consistently gets 1.0, their OKR’s aren’t ambitious enough. Low grades shouldn’t be punished; see them as data to help refine the next quarter’s OKR’s.”
This has been a very brief intro to the subject of OKR’s so for more depth, we suggest watching Klau’s entire presentation on the subject linked here.
With clear objectives set and key results to get you there, you can effectively set goals, make plans and achieve the success you’re looking for. As always, don’t hesitate to call your financial and legal experts here at GQLaw. We’ve got the answers you’re looking for.