Every company aspires to hit the loftiest heights and establish itself as a market leader.
However, to survive your hike to the figurative summit, you’ll need to have a few essentials in place, including Objectives and Key Results (OKRs).
We’re gonna drill home the fundamentals, including:
- What are OKRs?
- How can OKRs help product marketers?
- OKR examples
- Common OKR mistakes
- The difference between OKRs and KPIs
- How to define your OKRs
- OKRs resources
What are OKRs?
OKRs stands for objectives and key results and it's commonplace for orgs to have them in place.
OKRs enhance performance management and provide a platform for tracking success via the introduction of measurable goals and targets.
Often in place in a team environment, OKRs are usually set across a defined period to track progress, maintain progression, and introduce contingency plans, when needed.
How can OKRs help product marketers?
The topic of OKRs can tend to send shivers down the spine of the most hardened product marketer, as they can be notoriously difficult to perfect.
Given product marketers collaborate with a variety of teams, it's sometimes difficult to pinpoint exactly where they've contributed to the wider picture when it comes to the crunch.
Nonetheless, having a process in place to measure success is pivotal, and there are a bunch of essential product marketing OKRs and metrics you can incorporate into your product marketing strategy. After all, you can’t throw mud and hope something sticks, because a business without OKRs is heading one way, and it ain’t up.
Add to that, given just 4% of product marketers think their role is fully understood, as highlighted in the State of Product Marketing Report 2021, OKRs can contribute significantly in helping other teams see what you bring to the table, and perhaps encourage stakeholders to allocate more budget to your department in the future.
It's impossible to apply a one-size-fits-all when it comes to introducing OKRs within an organization. Each company has its own agenda, therefore, their OKRs will never be the same.
Let’s check out a few examples of OKRs in practice:
Example 1: Barcelona Football Club
Barcelona FC is one of the biggest clubs in world football. Though fans may view the club exclusively as a sports team, they're a well-oiled, finely-tuned business, with its own set of OKRs in place.
For instance, at the start of each soccer season, the head coach is given targets for the upcoming campaign, i.e. OKRs. This could be broken down as follows:
Objective: Win a European trophy and league title.
Key results may include:
KR1: Average scored goals rate of 3.0 throughout the season.
KR2: Average conceded goals rate of 0.5 throughout the season.
KR3: Average ball possession rate of 70% throughout the season.
These OKRs aren’t set in stone and may be revised as the season unfolds.
For example, if their MVP picked up a serious injury and couldn’t play in the season’s remaining fixtures, this would significantly weaken the side’s chances of success. Therefore, the initial OKRs set at the beginning of the season would be updated, and may look a little like this:
Objective: Finish runners-up and win a domestic trophy.
Similarly, key results may include:
KR1: Average scored goals rate of 2.0 throughout the season.
KR2: Average conceded goals rate of 1.0 throughout the season.
KR3: Average ball possession rate of 60% throughout the season.
The new set of OKRs acknowledge that in light of the injury, this could:
- Have an impact on the side’s chances of winning trophies,
- Reduce the goals scored by the team,
- Reduce the team’s possession rate.
Let’s take a look at another example, for the non-sporting fans amongst us:
Example 2: Website launch
The COVID-19 pandemic has hit the job market - hard.
Not only have millions been made redundant, with the economy taking a significant hit, but jobs have also become increasingly hard to come by.
As a solution, people are venturing down the route of freelancing and self-employment. And as we all know, a website is part and parcel of setting up a brand-new company.
Here’s how a freelance consultant could introduce OKRs when launching their brand-spanking-new website for their new clients:
Objective: Launch a new website for freelance consulting.
KR1: Search for, and invest in a suitable domain name by 5th February,
KR2: Choose a content management system by 11th February,
KR3: Populate content and publish the first blog post by 17th February.
Here, a clear-cut objective has been defined, while the deadlines for each of the key results can be used further down the line to distinguish whether the goals have been fulfilled.
Example 3: sales confidence
There are a ton of OKRs you can put in place to enhance your sales enablement efforts, such as sales confidence.
Your sales representatives need to embody confidence when they're trying to close a deal. If not, this can damage their chances of converting a prospective customer.
It’s super-easy to measure success with quarterly or six-monthly surveys to establish how confident sales reps are selling your product. The process also enables you to identify the steps you can put in place to help improve team performance.
Questions you can ask your team may include:
- How confident do you feel when pitching our product?
- How equipped do you feel to beat the competition?
- How would you rate the sale assets you have available to you?
- How much do those sales assets help you with pitching?
- Are there any areas where you think support is missing?
When you're conducting your research, be sure to use a combination of qualitative and quantitative data, then assess your findings, and establish a sales confidence barometer to refer to and set a benchmark.
Example 4: active users
Active users are people who use your product regularly, and it’s straightforward to document active users as an OKR.
For example, you can simply use a rolling percentage of how many users you have versus active users you have based on your definition of active, like this:
It’s advisable to match your stats up with your campaigns so you can get an idea of what’s driving uptake, before introducing contingencies, when needed.
Common OKR mistakes
While the benefits of OKRs can't be disputed, they're only useful if you implement the right strategies and pay attention to data that truly matters.
When you’re defining goals for your OKRs, avoid vanity metrics such as likes and page views. These figures don’t hold the same credence as bottom-line metrics tied to the overall success of your product.
OKRs should also be established with a clear view of what other parts of the business are doing. When establishing OKRs, implement a pyramid structure: employees should form the core foundations, and build up with managerial staff, department heads, etc. Not only will this help you hit your base targets, but it’ll prompt further success with stretch goals.
Finally, if you’re part of a business where rapid growth isn’t top of the agenda, nip back to the drawing board, and look for a plan B; OKRs are best-suited for orgs with large growth goals.
Key takeaway: Think about metrics that matter. When you need to justify your choices, be sure you can weather the storm and answer with confidence and conviction.
The difference between OKRs and KPIs
KPIs and OKRs are often mixed up, and while they’re similar, they aren’t the same. So, we’re gonna lay the facts on the table and explain the difference between the two.
What is a KPI?
A Key Performance Indicator is used to assess performance during a sustained period. This can be applied to the org as a whole, a project, an individual within the team, and so forth.
Given KPIs need to be measurable, quantitative data is favorable when adopting this approach; you could use qualitative KPIs, but subjectivity can over-complicate matters when interpreting data.
OKRs vs KPIs
A significant difference between OKRs and KPIs is the intention surrounding why the goals have been set in the first place.
When companies set KPI goals, they’re considered obtainable and are the product of an existing process or product. On the other hand, OKR goals differ in that they’re A) more ambitious, and B) more aggressive in their execution.
Remember, although OKRs may be bold, they need to be attainable. Although it's not unusual for high targets to be set, you can potentially damage the morale within your team if the final result falls significantly short of the target.
How to define your OKRs
Now you know what OKRs are, have seen examples of them in practice, and differentiated between them and KPIs, here's what to take into consideration when defining OKRs for your company.
Simplicity bears fruit
Set objectives that can be completed within the time parameters you have at your disposal.
Oftentimes, team members think they need to contribute to every objective and inevitably, they can’t maintain the standards expected.
Instead, keep it simple, and prioritize what matters; what does your business need to focus on the most?
There’s no definitive number of objectives you need to set - each company is different, and needs will vary depending on the nature of the goals being set, resources you have at your disposal, and potential bumps in the road that may occur down the line.
Be specific and plan
When you're setting OKRs, you need to adopt a methodical approach and develop an in-depth plan outlining all the possible ways you can accomplish your results.
Then, put together a more specific action plan, explaining how you’re going to hit each objective. Don’t forget, you’ll need to be crystal clear about how managerial teams will be able to assess whether or not the objective has been achieved - specificity is paramount.
Don’t walk up a blind alley; set clear, distinguished objectives so you have no doubts about A) what your goals are, and B) how you can get things done.
Some members of your team will be daunted by the thought of objectives.
In some cases, employees may not be able to see how their roles are directly contributing to the company’s success, and this is where cascade objectives come into their own.
Cascading objectives between varying levels of the org give employees a clearer sense of how they're contributing to the overall picture.
By sharing higher-level objectives, all members of the organization can pull together in one direction and adhere to the company’s vision.
Set realistic stretch goals
It’s often the case stretch goals are set by managers to push their team to the limit, and motivate them to hit new performance levels.
However, approach stretch goals with caution: if you’re continually setting unrealistic targets to try and push your team members, they’ll become despondent, and the exercise will have an adverse effect.
Always make it measurable
There’s no point in setting off on a journey if you can’t track your progress.
Whether it be a deadline, monetary target, or several visitors to your social media channel, always ensure your key results have a unit of measurement.
Use bonafide, quantitative data that’ll provide you with cold-hard facts.
Include sub-groups within your key results
When you’re setting your key results, create a series of mini-goals.
Not only will these keep you on track in pursuit of your overall goal, but they’ll also serve as milestones on your OKR journey and offer a perspective of the wider picture in terms of what’s been achieved, rather than ‘complete’, and ‘incomplete.’
Finally, give yourself and your team members the recognition you all deserve throughout the build-up to achieving a goal.
Be sure to incentivize your team members and acknowledge their hard work. There’s nothing worse than working your ass off for months, achieving your targets, and not getting any positive feedback. Good vibes make for good foundations moving forward.
Never be scared to shout from the rooftops and let the whole world know about your achievements; post it on social media, your website, wherever you want - success is nothing to be embarrassed about.
Remember, OKRs aren’t exclusive to a team.
If you want to, set OKRs for every member of your team as a means of encouraging them to take responsibility for their workload. This will give you an indication of where their strengths lay, and what measures need to be introduced to help them to improve other areas of their practice.
Needing to measure your product marketing success is a huge part of the role. After all, how are you going to identify what works and what doesn’t without metrics and data to back it up?
Our Metrics Certified: Masters course will give you the knowledge and confidence you need to measure the impact of your work and continue driving, not just your product and department, but the entire company towards success.
By the end of this course, you’ll be able to:
🎆 Use formulas to correctly measure key metrics.
💪 Identify which metrics you should track for each deliverable.
👀 Understand how your work can positively influence these metrics.
🔦 Relate your KPIs to your OKRs and confidently report on the impact your function has on the business.
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