You’re an early-stage company; you are feeling overwhelmed with a list of tasks that need completing. You hear about the latest quick fix and think it will work for your startup, so you head off in the direction of this shiny new object, and before you know it, three months have gone by, the shiny object wasn’t that shiny and you still haven’t made any traction toward your objectives.
Take our FREE Scorecard
This is a common theme that I see with early-stage companies, and it is becoming worse with the abundance of self-proclaimed gurus who are all over social media presently promising quick fixes and get-rich-quick schemes, which, if we think about them logically, don’t work.
As the business grows, communication across the company will become more complex. The different stakeholders within the business will have different impressions of what’s essential and what the business objectives are. We see things through our visual lens within our heads, and what looks critical to one person may not look important to another. Leaving these questions unanswered doesn’t help the business; it can delay your growth and distract you from what’s important. Early-stage companies are often cash poor and struggle with too much to do with limited resources; therefore, it’s vital to maximize the return of investment of their time and focus on the right actions at the right time.
This is an area where objectives and key results (OKRs) can clarify the business objectives and align the key results that will move the needle for growth to be laser-focused on what’s important. It’s about moving early-stage companies from chaos to clarity.
So What Are OKRs?
OKRs are used across businesses of all sizes and were developed by Intel Corporation. OKRs stand for “objectives and key results” and became famous when an early-stage startup called Google used them to shape their development. After that, the use of OKRs expanded across Silicon Valley and into various industries across the world. In my previous article, I discuss this in more detail and outline the potential pitfalls aligned with this approach.
The OKR framework comprises two main parts: 1) objectives, or what you want to achieve, and 2) key results, which capture how you know when you’ve achieved your objectives. As a rule of thumb, you shouldn’t have more than three objectives with any more than three key results aligned to each objective; otherwise, this defeats the goal of improving your focus toward the business objectives.
Take our FREE Scorecard
Why OKRs Are Necessary For Early-Stage Companies
• OKRs are lightweight and not bureaucratic, so perfect for startups.
Mentioning to a startup or scale-up business that they need to adopt a process that will entail managing objectives and setting a regular cadence to meet can scare them. But, once teams find that they have aligned behind their objectives and key results and monitor these regularly, they have more time to work toward their aims and develop a shared, everyday language that can grow with them. This stops the free-for-all approach with no routine, which leads to waste and frustration. OKRs provide this level of organization, and software packages can help manage these in the cloud, allowing businesses that are remote to use a shared platform.
• OKRs make early-stage companies more efficient.
Building on the first point, the endless back-and-forth conversations that are part of startup life become much more focused on the objectives. Yes, there will be other tasks that the business has to perform. Still, as long as the overarching OKRs are the north star for the business, this will allow the outcomes that need to be achieved to become clear and ultimately will reduce the level of wasted conversations. The question the teams need to ask when proposing a new way of working is, “How does this new task correspond to the OKRs we have set?” If there is no alignment, then the business needs to question why they are proposing this; otherwise, the shiny objective syndrome will prevail, which is not helpful to anyone.
The OKR framework provides an outcome-driven approach to allow early-stage companies to focus on the right action at the right time. Failure to do this may mean that the company doesn’t succeed, either due to wasted time or a lack of cash.
One last point to outline is setting the OKRs and merely hoping that these will be achieved by the end of the time frame. This is called “set it and forget it” and is one of the leading killers of organizational goal setting. So if you do use OKRs, make sure you have a predefined meeting cadence to review progress and ensure you are on the right track to meet these objectives.
Looking for an OKR coach to help your business?
Ready to change the way you think about early-stage business & product development
Take our FREE Scorecard
This Scorecard has been designed to show entrepreneurs, startups and small businesses their blind spots and provide instant, actionable steps on how to improve
If you would like to understand more about developing and growing products using OKRs, you can obtain more information here.