Goal Setting & Performance Management through OKR Methodology

The names of some of the world’s biggest achievers grace the list of companies that adopted the OKR methodology for better performance while driving employee engagement. What are the key components of this methodology?

• Set objectives and break them down to measurable key results.
• Set stretched goals to push employees to achieve their potential fully and beyond.
• Continuously track  performance and revise Key Results for agility
• Involve employees in the process and take their inputs. Remember your employees are more than just a cog in the wheel.
• Ensure that employee goals are aligned to organizational objectives
• Make the employees feel included and help them identify with the whole process.
• Leave the implementation to the employees, once they accept the goals set.
• Goals need not be achieved 100% as they are set as stretched goals at the outset. 80% achievement of an OKR goal is more than 100% achievement of a non-stretched goal.
• Be flexible and learn as you go and provide autonomy to people even as you engage them.

It isn’t possible for people to serve the interests of an organization and work towards achieving its goals effectively, without being engaged with them personally. How can we motivate people, who only work at a job because it helps them pay bills and stay employed? What can make them try to do their best and showcase performance which is worthy of special mention? Employee performance will not meet expectations, without having them engaged to the larger purpose for which the organization exists.. Companies that pay attention to employee engagement thrive and make more profits too.

Are employees who are happy at a workplace engaged? Not necessarily. Engagement also requires them to be aware of the performance expected of them, and to have clearly defined roles and goals. Because these are what translate to real engagement as they have a clear idea of their purpose at work and can actually measure themselves against the expectations, even without a performance review. They know that their work is having the necessary impact and would be interested to push their own boundaries to see if they can do even better.

When Peter Drucker proposed his MBO (Management by Objectives), he was strategizing to get managers from being caught up in an activity trap, where they were busy through an entire day without reference to business goals or organizational goals. Intel’s Andy Grove upgraded this by adding Key Results to Objectives, which help with performance management. Credited with having ensured company-wide growth by Google, the OKR methodology has been helping organizations to set goals and manage performance effectively to achieve success.

The Components of OKR Methodology

The way OKRs work ensures that organizational goals are clearly defined first. They’re then cascaded down to departments, teams and finally individual employee, setting them clear goals and outcomes to be achieved.

An organization through OKRs understands where it wants to be, and how to get there by breaking down larger firm-level objectives into goals/key results and cascading them down to each employee for effective performance tracking. Organizations both big and small benefit from the OKR Methodology, by helping employees to understand the impact of their efforts on the organization’s ability to achieve its goals.