Only 7% of Spanish startups reach more than five years of age, according to our latest Entrepreneurship report. A lack of organization may be behind this short life span of some projects. Planning and execution are not to be overlooked; while they may seem like an easy task, many times they are the key to success.
What are the OKRs?
The OKRs (Objectives and Key Results), a term invented by Andy Grove (former CEO of Intel in 1970) in order to explain a methodology to organize the daily work, can contribute to improving this planning. Although this term was born in the 70’s, it was not until the 90’s that it became popular in Silicon Valley, thanks to the book “Measure what matters” by the American investor John Doerr, considered the father of the OKRs.
As the acronym implies, the idea is to establish personal, measurable objectives focused on the company’s vision. These objectives should be public and their goal is to quantify growth at employee, team or organization level through results.
Here is Sofia Benjumea’s keynote from Google for Startups about OKRs in #SouthSummit19
How to implement this methodology?
To implement this methodology, the first step in implementing this methodology is to set the organization’s answer to “where do I have to go?”, “How do I get there”, and “how will I know that I have arrived?”.
Establishing objectives is a priority if we want to determine where to go. It is equally important to be ambitious as it is important to be realistic and not to set too many and too strict OKRs. In addition, they must be aligned and supported by the entire organization. Of course, these challenges can also be set at a personal level and do not have to be linked to a company.
How to measure results?
Once the challenges that we are going to face have been defined, the next step is to give them an answer, i.e., to define some measurable goals. How do we quantify them? With measurable data, limited in number and time.
For example, imagine that the goal is to get funding for a startup. In this case, a measurable way to achieve and measure the objectives would be to get new investors or raise a funding round of a certain amount in a year.
Now, how often should these objectives be reviewed? At Google, they are set every three months for short-term-goals and annually if they are more complex to achieve. Finally, when you have the final results, to understand the performance, there is a scoring method. At the end of the established period, each employee scores his or her results from 0 to 1, with an average of 0.7-0.8 being satisfactory.
Surrounding yourself with a good team is the key in a startup, but it is even more important to make the talent work effectively. As John Doerr said in his book ‘Measure what matters’: “Ideas are easy. Execution is everything”.
If you haven’t implemented this system, what are you waiting for?