The easiest way to write OKRs for your company
Profit, Product & People
When it comes to writing OKRs (Objectives and Key Results) for your company, a straightforward approach is to consider the three main stakeholders: the owners, the customers, and the team. By focusing on these areas — Profit, Product, and People — you can create OKRs that align with your company's overall goals and drive meaningful results.
1.Owners: Profit
Like it or not, most organizations need to have financial objectives. Whether it's driving revenue growth for a startup that just secured funding or generating enough income to cover costs for a social enterprise, the need to keep the lights on is universal.
Incorporating profit into your OKRs is important for several reasons:
Alignment with Company Goals: OKRs should reflect the company's overarching objectives, and revenue is almost always a key component.
Strategic Direction: Revenue projections are not just numbers; they answer critical strategic questions like, "Why do we expect to grow by 50%?" This could be due to entering a new market, launching a new product, or other strategic moves.
Departmental Alignment: Other departments will need to align their objectives based on revenue targets. For instance, if you're entering a new market, marketing will need to set relevant goals, and your product team will likely be involved in the process too.
Here is an example of an OKR for revenue, that gives strategic direction.
Objective: We expand our business by showing we can be profitable in new markets from the first year of expansion.
KR #1 Revenue in existing market (The Netherlands) grows with 10% from 1 mln to 1.1 mln EUR
KR #2 Revenue in new market (Belgium) grows from 0 to 200k EUR within the first year of operation
KR #1 Revenue in new market (Germany) grows from 0 to 400k EUR within the first year of operation
2. Customers: Product
Once you’ve set the strategic direction, the next step is to ensure your product aligns with customer needs. Your product should be built around what customers love about it. For example, if your competitive advantage is speed, your OKR could focus on improving delivery times. If you're winning on price, set an OKR around maintaining or reducing costs.
The key is to center your OKRs on the aspects of your product that resonate most with your customers. This will help ensure that your product continues to meet their needs as your company grows.
Here is an example of an OKR for product, that has a clear focus on the customer.
Objective: Our product finds market fit in our new markets.
KR #1 Our customers use our product at least 1x per week
KR #2 Delivery time is within 24 hours
KR #3 Customers rate our product with an average score of 8 out of 10
3. Team: People
In our view, the most crucial element is building a team capable of achieving the ambitious goals you’ve set. Start by listening to your team’s feedback and use it to inform your OKRs. For instance, if your employee surveys indicate low scores on salary transparency or learning opportunities, this is a clear signal that needs to be addressed. Creating OKRs around these areas shows your team that you value their input and are committed to improving their experience.
Pro Tip: If you don't have an employee survey, you should have one! Ideally every quarter: this allows you to respond promptly to your team's feedback.
Here is an example of an OKR for a team, that can be used based on employee feedback scores.
Objective: Our employees are very happy to work with us.
KR #1 Employee satisfaction on salary and compensation grows from 6 to 8 (out of 10)
KR #2 Employee satisfaction with opportunities to learn grows from 4 to 7 (out of 10)
Additional Stakeholders: Environment
While this guide focuses on Profit, Product, and People, you may also consider adding OKRs for external stakeholders, such as the environment. For example, if sustainability is a priority for your company, you could create an OKR focused on reducing your carbon footprint.
Summary
Creating effective OKRs starts with focusing on your key stakeholders: owners, customers, and your team. By aligning OKRs with profit goals, customer needs, and team feedback, you set a clear direction for your company’s growth. Remember, the success of OKRs depends on regular reviews and adjustments. Keep listening to your stakeholders, and be ready to refine your OKRs as needed to stay on track.
