Objectives and key results (OKRs) are critical goal management framework that most forward-looking organizations use today. If one of your OKR cycles is coming to an end, you may be looking for ways to grade them. The scoring activity will help you understand your achievements and how you could improve in the coming cycle.
Assuming the OKRs are set with a reasonably stretch built-in if you get high scores, it shows that you have succeeded. Low scores, on the other hand, mean that there is room for improvement. Understanding and calculating the OKR score is not cumbersome when you understand the rationale behind them. This guide explains to you how to score OKRs and everything else you need for its success.
What is OKR Scoring?
According to the ReWork OKR guide of Google, scores indicate whether a team has achieved OKR or Key Result. The scale involves a score between 0.0 to 1.0, whereas the other end of the spectrum means that Objectives or Key Results got fully accomplished. Key Results have individual scores, while Objectives take into account the average of all the Key Results.
Each Objective has a number of associated Key Results, which are graded on a scale from 0.0 to 1.0 in order to indicate whether or not they have been achieved.
The grading concept can be complex, and different organizations may interpret it in different ways. However, the importance of scoring OKRs cannot be overstated. By grading each Objective and Key Result, you can see at a glance how well your team is performing overall and identify areas where they need to improve.
Furthermore, setting goals that are quantifiable and measurable allows you to track your progress over time and ensure that you are on track to achieve your targets. OKRs can be adapted to any organization size and business type, making them a versatile tool for improving performance.
Huminos automatically scores your OKRs based on the progress made by individuals or teams. Have a look at how you can use the huminos software platform to score and check OKRs with easy clicks.
Importance of Scoring OKRs:
Well, scoring your OKRs is one of the most important steps in the process. Without it, you won’t be able to measure your progress or determine whether you’ve met your objectives.
Grading your OKRs is also a great way to establish a common ground for teams and departments across the company. It ensures that there is no subjectivity when it comes to measuring performance, and managers can expect uniformity in rating the performance of teams.
So, how do you go about grading your OKRs? It’s not as difficult as you might think. Here are a few tips to help you get started.
- Make sure your objectives are specific and measurable
One of the key things to remember when setting objectives is that they need to be specific and measurable. This makes it easy to grade them on a scale of 1 to 5, for example. If your objective is simply “improve customer satisfaction”, it’s going to be difficult to measure how successful you were. However, if your objective is “increase customer satisfaction by 10%”, it’s much easier to quantify your success.
- Use a consistent grading scale
It’s important to use a consistent grading scale when scoring your OKRs. This will make it easier to compare the performance of different teams and departments. A common grading scale is 1 to 5, with 1 being the lowest and 5 being the highest.
- Be realistic about what you can achieve
It’s important to be realistic about what you can achieve. Don’t set objectives that are impossible to achieve, as this will only lead to frustration and disappointment. Instead, set achievable objectives that you can actually achieve. This will help you to score your OKRs with confidence and avoid any unnecessary stress.
With these tips in mind, scoring your OKRs should be a breeze.
What are the basic OKR scoring principles?
OKRs should be motivational and aspirational for employees. They should force teams to think and achieve beyond their usual limits. So, it is acceptable even if a team reaches a score of 60-80%. But this approach can also pose some challenges.
If a new team misses its goals, it can be demotivating for them. There can also be some essential OKRs that teams need to achieve 100%. Different types of OKRs like roof shots and moonshots come in handy in such situations.
Roof shot OKRs remain bounded by commitment, and teams need to achieve the 100%. They are independent and remain critical for the growth of an organization. If the milestone is about a product launch, it should be a roof shot. It is because this milestone has several links attached to it, like promotions and marketing.
Moonshot OKRs are aspirational and do not ask for 100% achievement. Even if teams achieve 60-80%, it remains acceptable.
OKRs above 100%: Should you have it?
It is never a good idea to have OKRs that go beyond 100%. It doesn’t make much sense for teams to achieve OKRs beyond the target limit. Such OKRs do not remain ambitious even if we consider roof shots. You will also not be able to see the comprehensive progress of your team. The OKR methodology says that organizations should also be able to measure their progress towards achieving the goal.
It is not advisable to achieve the Key Results at the cost of key metrics related to the organization. Key Result about acquiring 100 new customers in the quarter should also talk about the costs involved behind their acquisition. Their ticket size also needs consideration. It will help teams understand ways they can do it effectively and at reduced spending. Getting high-paying clients is also critical instead of just making up the numbers.
Here is an example of how you can write a related OKR.
Objective
- Acquire 100 new customers during the quarter
Key Results
- Get 1000 highly qualified leads
- Ensure that customer acquisition cost remains below $10
If the team brings in 150 new customers, but the acquisition cost remains at $18, it does not mean that the performance is good. It is an example of what the holistic approach to OKRs means. Each Key Result should look at the bigger picture and not affect the organization’s functioning in any way.
Things to consider when grading OKRs
Here are four things you can keep in mind on how to score OKRs
OKRs do not mean performance evaluation
An OKR evaluation is not the tool to measure the performance of an individual member of a team. However, it is a reflection of what team members achieved during the quarter. It also shows the impact their work had on the organization.
A score of 60-80% is good enough
If the team score higher, it means that the goals are not challenging enough. At the same time, lower scores mean teams are not doing their best. So, if you follow the 0.0 – 1.0 scale, achieving 0.6 to 0.8 should be a good OKR score. New teams should be especially wary of this and not consider it as underachievement.
Track OKRs regularly
It is helpful to have regular check-ins throughout the quarter. You can have a mid-quarter check-in to track the team’s progress and understand if there are any issues. There can also be a check-in towards the end of the quarter. It will be beneficial before managers assign final grades to OKRs.
Have a public grading system
Organizations like Google have quarterly and annual gradings. When the new year begins, they share the grades for the previous OKRs. Furthermore, they also share new ones for the quarter and the year. The quarterly cycle continues where new goals get introduced for the corresponding period.
Subjectivity in scoring
Scoring OKRs can be a subjective matter. As several factors impact the success of an objective, scoring is not always a simple mathematical calculation. Teams may put efforts beyond expectations but still might not achieve the goal fully. It is common in moonshot OKRs.
Consider the example of writing and publishing 100 blog posts in a month. Your team may put two additional hours in a day and might still fail to achieve the desired target. The objective is to push the team members beyond the expected limit by building stretch targets. If the team writes and publishes only 90 posts, they fall short by 10.
The team has technically missed the result, but only by 10%. There is no doubt about the capability of the team and its efforts. However, it did not translate into actual results but the outcome still has a meaningful impact at the organizational level.
Conclusion
OKR is a comprehensive strategy that businesses are using effectively to measure the performance of teams. Scoring and measuring the success of OKRs has no fixed rules. But there are several best practices involved that we have mentioned above. When it comes to their implementation, it is up to you to decide what makes the best sense for your team.
You can have a combination of objectives, key results, and performance indicators to implement OKRs successfully. Keep in mind that having a minimum number of OKRs is always beneficial. You can reduce complexities by having a limited set of OKRs and ensure wide acceptance and participation from your employees.
About Huminos
Huminos is a comprehensive performance conversations platform that helps your employees to achieve impactful outcomes, even if they are working remotely. Features like OKRs, 1:1 conversations, feedback, reflections, and pulse allow you to plan and measure work that really matters to your company.
At huminos, we help organizations like yours to scale performance management through a range of OKR tools. The OKR coach is a comprehensive system enabled with learning exercises that help you manage your team to perform better.