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What is OKR? (Objectives and Key Results) Complete Guide to Goal Management Framework

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Let's learn about OKR, the goal management method used by Silicon Valley companies like Google, LinkedIn, and Twitter.

What is OKR?​

OKR (Objectives and Key Results) is a framework for setting and managing organizational and individual goals through Objectives and Key Results. It was developed by Andy Grove at Intel and became famous when John Doerr introduced it to Google.

OKR clearly defines "where we want to go (Objective)" and "how we know we've gotten there (Key Results)".

Structure of OKR​

Objective (Goal)​

  • Qualitative and inspiring goal
  • Explains what you want to achieve
  • Should be motivating and easy to remember
  • Example: "Become the service customers love most"

Key Results (Core Results)​

  • Quantitative and measurable results
  • Indicators to determine goal achievement
  • Generally 3-5 items
  • Example: "Achieve NPS score of 70", "Reach 1 million monthly active users"

Characteristics of OKR​

  • Transparency: Making all employees' OKRs public ensures the entire organization moves in the same direction.
  • Alignment: Personal, team, and company OKRs are connected to maintain consistency.
  • Challenging: Sets challenging goals where 60-70% achievement is considered success.
  • Periodic review: Set quarterly and check progress weekly/monthly.
  • Separation: Recommended to separate from performance evaluation to encourage challenging goal setting.

How to Set OKR​

Step 1: Define Objective​

Conditions for a good Objective:

  • Is it inspiring and motivating?
  • Is it clear and easy to understand?
  • Does it drive action?
  • Does it have a deadline? (usually quarterly)

Examples:

  • ❌ Bad example: "Increase sales"
  • ✅ Good example: "Provide the best customer experience in the industry"

Step 2: Define Key Results​

Conditions for good Key Results:

  • Do they have measurable metrics?
  • Do they clearly show goal achievement?
  • Are they challenging yet achievable?
  • Are there 3-5 or fewer?

Examples:

  • ❌ Bad example: "Improve customer satisfaction"
  • ✅ Good example: "Achieve customer satisfaction (CSAT) of 4.5/5.0"

Step 3: Check Alignment​

  • Are company OKR → team OKR → individual OKR connected?
  • Do team OKRs conflict with each other?
  • Are priorities clear?

Step 4: Periodic Check​

  • Weekly: Brief progress check
  • Monthly: Detailed progress review
  • End of quarter: Final scoring and retrospective

OKR Examples​

Company-level OKR​

O: Become a market-leading mobile app

  • KR1: Achieve app store rating of 4.8/5.0
  • KR2: Reach 500,000 daily active users (DAU)
  • KR3: Achieve 1 million app downloads per month

Team-level OKR (Marketing Team)​

O: Significantly increase brand awareness

  • KR1: Increase brand search volume by 200%
  • KR2: Reach 100,000 SNS followers
  • KR3: Achieve 20 media articles per month

Individual-level OKR​

O: Strengthen frontend development capabilities

  • KR1: Complete 3 React-based projects
  • KR2: Present at frontend conference once
  • KR3: Achieve 95% code review approval rate within team

Advantages and Disadvantages of OKR​

Advantages​

  • Clarity: Clear about what needs to be achieved.
  • Focus: Can concentrate on the most important goals.
  • Alignment: Entire organization moves in the same direction.
  • Transparency: Everyone can know each other's goals.
  • Challenge: Encourages setting challenging goals.
  • Measurement: Can objectively measure progress.

Disadvantages​

  • Time-consuming: Takes time to properly set and manage.
  • Risk of misunderstanding: If misunderstood, can become a simple to-do list.
  • Excessive focus: May neglect important work not in OKR.
  • Pressure: Challenging goals can act as burden.

Differences Between OKR and KPI​

CategoryOKRKPI
PurposeGoal achievement and growthPerformance measurement and maintenance
NatureChallenging (60-70% achievement OK)100% achievement expected
PeriodQuarterly changesMaintained long-term
DisclosureCompany-wide publicLimited sharing
Evaluation linkSeparation recommendedDirect link

Frequently Asked Questions​

Q: Must OKR be set quarterly?

A: Generally quarterly, but can be set monthly or semi-annually depending on organizational situation.

Q: Must all OKRs be 100% achieved?

A: No. 70% achievement is considered success. If always achieving 100%, it signals the goals aren't challenging enough.

Q: Should individual OKRs also be public?

A: According to OKR's transparency principle, making all employees' OKRs public is recommended. However, it can be adjusted according to organizational culture.

Q: Should OKR be linked with performance evaluation?

A: Not recommended. Direct link with performance evaluation leads employees to set safe goals instead of challenging ones.

Q: Do small startups need OKR?

A: Regardless of size, OKR is useful if clear goals and direction setting are needed. However, don't be too rigid about format and apply flexibly.

Conclusion​

OKR is a powerful tool that clarifies what an organization wants to achieve and how to measure it. Many successful companies including Google have grown rapidly through OKR. What's important is keeping OKR's core principles of clear goal setting, transparent sharing, and continuous checking rather than the format!