The term Objective and Key Results (OKR) has become so popular that its search rate has grown fourfold over the last few years! Ever since John Doerr introduced OKRs to Google in 1999, Larry Page and Sergey Brin adopted it across their entire team and the idea soon spread like a forest fire to other Silicon Valley companies as well. Multi-national companies like LinkedIn, Spotify, and Airbnb credit their growth to this efficient goal-setting framework. Today, even start-up organizations abide by this framework to manage their teams and set measurable goals. However, to be able to fully enjoy the benefits of the OKR framework, it is vital to use it appropriately. The OKR culture may seem a little intimidating in the beginning, but it truly comes to fruition if used duly.
10 simple hacks to crack the beauty of OKRs and implement them successfully.
1. Familiarizing with the framework
If you’re new to this culture, the easiest first step to take would be to define your OKRs. Next, ask yourself the following questions- “What do I want from OKRs?”, “How is it going to help my organization?”, “What sort of goals are realistic?” and so on. This step ensures clarity and definition and will eventually help you set individual as well as team goals. It definitely takes a few hits and misses with the framework to completely figure out what works for your organization but once you are crystal clear on what OKRs represent and how they can be utilized for your convenience, it’s onwards and upwards for your team!
2. Setting a Vision
Once you’re done familiarizing yourself with OKRs, the second step to take is to set goals! Although setting goals might sound easy, it is important to remember that all your goals need to have a particular direction they’re flowing towards. This is where your vision comes into play. Having a vision and mission helps set goals that are in tandem with the entire organization and helps team members float on the same wavelength throughout. This enhances clarity and the business environment.
3. Measuring Impact
Time to take the “So What?” test! Whenever you set a goal, ask yourself this question. Let’s look at a few examples. Goal 1- Post this blog on the website
“So what? How is this going to impact the company’s social media?” Goal 2- Refine the revenue model
“So what? Why is the current one not sufficient anymore? How is my new model going to serve its purpose?” When you find the answers to these questions, you get clarity and a purpose for your goal and its impact on your organization. This saves valuable time. The “So What” test is a great hack used by marketing companies where they ask this question about three times before making any vital decision. Well, this could be a great hack for life too!
4. Taking a reality test
It is extremely crucial to focus on your goals and work accordingly. If a certain goal isn’t working for your team, don’t hesitate to tweak it. Stressing on a goal that doesn’t work is a waste of time and energy and a burden of its own. Similarly, don’t overload your plate. Deal with a realistic number of goals at a particular time. Remember, it’s always quality over quantity. Implementing the system of Moon-shot and Roof-shot objectives could give you some clarity. Moon-shot objectives are meant to be set beyond expectations, so they work even if only 70% of it is achieved. Roof-shot objectives are targets that are set at achieving 100%. Revenue targets are a viable example of a Roof-Shot Objective.
5. Patience is key
Revisiting an aforementioned point, OKRs always take hits and misses before you find your right fit. Hence, don’t get demotivated if it fails the first few times. What’s important is that you understand the workings and the scope of OKRs during the process. Having clear-cut, well-defined goals curated after days of patience and perseverance is always better than vague and ambiguous goals.
6. Preparing a culture
OKRs only flourish in the correct ambiance. Hence, Adopting and practicing a business environment that is based on trust, transparency, collaboration, and responsibility will help cultivate a culture that thoroughly enjoys all that OKRs are set to offer. An organization that executes the Continuous feedback mechanism on a regular basis and keeps tweaking its organizational goals based on the feedback is also a major sign of a healthy culture.
7. Avoiding Individual OKRs
Although it is a common habit to jot down your goals starting from the organizational level down to the individual level, it oftentimes creates a lot of confusion and stress. Individual OKRs tend to shift focus from the overall goals of the organization and also demote team spirit at times. Due to reasons like these, Spotify has ditched the entire concept of individual goals.
8. Differentiating OKRs and Performance Reviews
Granted, it is an excellent tradition to use your OKRs as one of the factors during the performance reviews but gluing the attributes together creates ambiguity and room for misuse. Setting realistic goals gives you more chances of completion and satisfaction while also improving the employee efficiency compared to setting extravagant goals and stressing yourself over its completion. This naturally fuels your performance reviews and positive feedback. Understanding that performance reviews are subjective is key here. So, it is almost impractical and unfair to combine the two factors. It leads to low team spirit and exaggerated achievements.
9. Evaluating and Iterating
After the set OKRs are proving to be efficient for your team, it’s always virtuous to note down why a certain goal is working and why it isn’t. Evaluating your team’s response and progress for a particular set goal gives an in-depth understanding of your team and helps make critical changes. This comes in handy when the team is working on new goals in the future. A valid pointer to keep in mind is that goals reach the point of perfection only after trials and iterations. Our failures are our biggest teachers. Hence, continuously revising the goals to match the team’s wavelength rather than completely discarding them can prove successful and also make room for growth.
10. Rewarding system
Review meetings for OKRs are one of the healthiest ways to check the success and efficiency of your implemented OKRs.
The first step to keeping a reward system in check is to first communicate the shared progress of the organization. Communicating is as important as goal-setting. Meetings conducted on a twice-a-week, or weekly basis help employees to share, discuss and stay accountable. Review meetings also pave way for transparency, one of the most important aims of the OKR methodology. These check-ins help identify in-efficient goals along with instilling a responsive and motivating environment.
Organizations that understand the aforementioned and implement them smartly, can truly experience the success of The OKR goal-setting framework. All it takes is determination and teamwork to experience the dream work. OKRs have the ability to metamorphose your business and create long-term value-adds. Handle it with care and you shall see the flowers bloom from the bud and unfurl their nectar in time.
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There is no doubt that an employee’s performance is the foundation and primitive cause for any organization’s success. Many organizations invest their time, money, and energy in advanced performance appraisal methods. In this article, let’s take a close-run towards the various methods to access employee’s performance used by leading companies.
What is Employee Performance Appraisal?
Performance appraisal is the process of documenting, evaluating, measuring, driving and developing employees’ performance in a systematic manner. In other words, it can be termed as an employee appraisal system, performance review, or performance management system.
Benefits of performance appraisal
Performance appraisal has three major benefits for both the employer and the employee.
1. Selection Process validation:
Performance appraisal helps the managers to validate the selection process and it also helps to recommend changes and improvements to be made in the existing process. A periodic review of the selected employee’s performancehelps to know the strength and weaknesses of the performance appraisal methods.
The employee appraisal system helps to identify the best performers and to compute their compensation package based on the merit system. It boosts the employee’s contribution to the company. On the other hand, the employees who lag behind in performance are identified and training policies and programs are framed accordingly.
3. Employee’s self-development
Self-development is one of the best benefits for an employee through positive feedback, promotions, rewards, and transfers. The performance appraisal methods help in identifying his area for improvement. Along with the manager, an employee can devise training programs to enhance his skills.
10 New Performance Appraisal Methods
When it comes to an Organisation’s success, predominantly it relies on the employee’s performance. There is a boundless number of performance appraisal methods available to evaluate, review, measure, and develop an employee’s performance. Let’s take a look at the 10 recent performance appraisal methods and how they benefit both the manager and the employee.
1. Management by Objectives (MBO)
Management by Objectives is the process of setting objectives by the organization, that leads the employees to set goals with proper alignment with the management. This process drives them to know their roles and responsibilities and work towards the future course of action. MBO measures the employee’s performance by how they achieve specific objectives. MBO is used widely across many organizations. Effective communication between the manager and the subordinates overcome the limitations of this appraisal method, where more focus is on the objectives and targets than the working culture and human elements.
2. 360-Degree Feedback
360-degree feedback, also known as multi-source feedback, is the process of gathering feedback from the supervisors, co-workers, peers, direct reporters, and also self-assessment. It helps to review the behavior and skills of each employee and explicitly the strength and weaknesses of the person. 360-Degree feedback is the best option for an organization when the employees work in cross-functional departments and teams. This performance appraisal method gets more effective when the peers deliver constructive feedback and the organization trains them to deliver it effectively.
3. Behaviorally Anchored Rating Scales (BARS)
Behaviorally Anchored Rating sales, termed as BARS evaluate the employee’s performance dimensions by comparing certain behavior statements usually on 5 point or 9 points scale. They guide the employee’s entire life cycle by providing a complete profile for each one of them. BARS tool is best used in the HR activities like Talent Acquisition, learning development, Employee Performance Management, Career Growth, Succession Management, and building culture. It is more applicable to the companies that have a group of employees doing a similar job and the same rating scale can be used to evaluate the performance.
4. Critical Incident Appraisal Method
A critical Incident appraisal is a method of collecting incidents from the managers or domain experts pertaining to the KPIs of the employee. It involves continuous monitoring of both positive and negative behavior and how it is exhibited. This method is more descriptive and has limitations to comparing the employee’s performance based on the decisions made in particular incidents.
5. Human Resource (cost) Accounting Method
The human resource/Cost Accounting method analyses the employee’s performance with the financial gain they bring into the company Vs their cost. It is effective in organizations where they have a perfect estimate of the employee and his contribution cost. Also, it is most useful in companies where performances are driven by the P & L statements.
6. Psychological Appraisal
The psychological appraisal approach attempts to evaluate employees based on predicting their future performance rather than focusing on their past performance. It is a unique method, where qualified Psychologists look for the personality traits, interpersonal skills, intellectual abilities, and leadership skills that play a vital role in future performance. This method is best used in reorganizing and promoting leaders to the next level of the organization chart.
7. Narrative appraisal method
A narrative appraisal is basically a written analysis in the form of easy analyzing an employee’s performance. These reports are more open-ended and stand out from the pre-defined questions. This appraisal is more individualized and qualitative in nature. Comparison between employees and managers expressive skills are major challenges in this method. This approach is suitable for company’s where employees tend to do more creative jobs and customized performance evaluation is preferred.
Performance Check-Ins appear similar to other performance appraisal techniques, but they are not. Performance check-Ins occur more informally, where managers tend to build rapport with their subordinates and they align each other to work towards the organization’s goals. Check-Ins happen in stipulated intervals (weekly, monthly, bi-monthly, or quarterly) and it is important to access the progress of the employee since the last Check-In. It is the best method for an employee to devise his long-term goals by allocating time and space with his manager for a discussion to improve his performance throughout the year.
9. Competency Assessment
Competency Assessment is the measurement of someone’s capabilities against the job requirements. The assessment is carried out on the identified tasks and skills that are considered to be critical to performing the role successfully. The employee’s skill and proficiency are compared with the target standards and fill the gaps if they lag behind. This method emphasizes only a specific set of competencies and not every activity performed in the job.
10. Checklist Appraisal
Checklist Appraisal consists of a list of statements, that can be evaluated with answers “yes” or “No”. The assessment statements are both positive and negative about the workplace habits, employee’s job skills, etc., Unlike the descriptive or narrative method, the Checklist appraisal technique is the easiest and the quickest form for assessment. This performance appraisal method is suitable when the feedback list covers a lot of areas and also allows the manager to honestly answer whether the employee’s traits fit in for the job or not.
Performance appraisals software plays a vital role in understanding the employees and keeping them motivated through proper recognition and awards. These tools also help managers and leaders to align with employees to set development objectives and gather regular feedback from them.