OKRs, or “Key Objectives and Outcomes”, is a collaborative goal-setting methodology used by teams and individuals to set ambitious and challenging goals with measurable results. It is a way to track progress, create alignment, and encourage participation around measurable goals. Key outcomes are the tasks or actions that help you achieve your goals. They are measurable, time-limited, aggressive, yet realistic.
When all the key results are met, the goal is necessarily achieved. OKRs are a goal-setting approach in which one objective describes the desired outcome and relies on 3-5 key measurable outcomes to achieve that outcome. The difference is that you set annual goals and then create quarterly results to achieve that goal. OKR's best software is one that allows you to clearly configure and manage key objectives and outcomes, and create alignment around those measurable objectives. Everyone on the team knows exactly how their key results contribute to the company's goal. Google's scoring method provides the highest level of detail, using a percentage scale (0.0 - 1.0) to give each key result a numerical score at the end of the cycle.
Other key differences between MBO and OKR are that the latter are quarterly, not annual, and separate from compensation. This encourages a more bottom-up approach to goal-setting, by giving teams ownership of key company results. By showing key results and projects in a single view like this, an organization can have a conversation both about its strategy and the execution needed to achieve strategic results. The outcome of initiatives should be a key outcome, such as getting coverage in 20 media outlets. Once teams establish their clear objectives and key results, individual team members will decide how to achieve their OKRs.
By reviewing their objectives and key results every 3 months, teams have 4 opportunities a year to respond to changes in the real world. Setting tasks as key outcomes prevents you from truly measuring the things that influence your success. It is important to remember that OKRs are not just about setting goals but also about measuring progress towards those goals. By tracking progress against these measurable objectives, teams can ensure they are on track to reach their desired outcomes.