No one loves performance ratings. They're painful for employees and managers.
Whether your employees grade themselves or request ratings from colleagues, most people score a solid 7.5. This leaves managers with zero useful information for coaching or performance management.
But with OKRs (objectives and key results), performance grading is a completely different story. The OKR system isn’t designed to support annual reviews. No one is granted or denied bonus cash on the basis of OKR scores. Forward-thinking organizations use OKRs to keep teams focused, aligned, and informed about progress.
Take Google, for example. Google uses OKRs to help everyone know who’s getting what done, from co-founder Larry Page right on down the line. They inspire teams and individuals using bold challenges and accountability as driving forces.
If your organization is planning to implement OKRs, use these tips to share, measure, and reevaluate goals. Better performance results guaranteed!
The Google OKR system involves four tiers: company, team, managerial, and personal. Each tier has four to six objectives per quarter. If you’re new to objectives and key results, this many items could prove overwhelming. You can start with one or two OKRs, and see how it goes. Here’s an example of the different tiers and how they might fit together:
Objective: Scale Up Sales and Marketing Departments to Increase Revenue
HR Department OKR
Objective: Improve Recruitment; Reduce Average Position Vacancy Days by 25%
Jane Smith (HR individual) OKR
Objective: Lower New Hire Failure Rate by 50%; Reduce Overall Turnover by 25%
When identifying company-level OKRs, think beyond revenue or market penetration goals. Include objectives that support your culture/broader mission. According to Google’s OKR model, more than 50 percent of objectives should come from the bottom up.
Once your OKRs are documented, they should live in a shared environment. Put them someplace where everyone has easy access and will revisit often. A goal-sharing platform keeps everyone engaged and on track. It acts as a real-time forum for praise, comments, and public recognition. Opportunities to browse team photos and videos will keep employees connected to their OKRs, too.
Choose objectives that can be achieved through concrete, quantifiable actions (key results). When you first introduce OKRs to employees, it’s okay to help them begin thinking about goals in abstract ways. But ultimately the “something” should have a metric attached to it. Goals software can support regular updates, in terms of dollar amounts, percentages, web analytics, or other hard numbers. And make sure you're setting the right goals! Check out our Engagement Studio tips on how to set meaningful benchmarks.
Ugh. Time to grade performance? Before any performance review anxiety creeps up, rest assured: with OKRs, the scores don’t really matter. And the range of possible scores — between a 0 (not meeting the objective) and a 1 (totally nailing the objective) — is pretty innocuous. Your main goal is to review the things you tried, and reflect on why they worked or didn’t work.
If you were close but not quite there, you may want to double down on objectives with a tweaked set of key results. If you crushed everything in your path, your next-quarter objectives should be more aggressive. And if you fell flat on your face, maybe you’ll attempt another approach that could produce the same results. Or maybe your objectives require the assistance of a coworker. (With public OKRs, she’ll already know what you’ve been working on and why it’s important.)
When employees and managers get together to talk about performance, the conversation can be built around real actions and results. No awkward estimates or nebulous claims of accomplishment.