What is a Key Result? A key result is one of the important factors in the process of businesses applying the OKRs. How should this method be implemented to give the best results? The following article by Viindoo will provide you with detailed information.
What is a Key Result?
In the 1970s, the method OKRs was first applied by Andy Grove at Intel and brought unexpected results. Currently, the OKRs method is widely applied to the management system of many famous companies in the world such as LinkedIn, Oracle, AOL, Dropbox, Google, Twitter, etc.
Key Results are indispensable factors when businesses apply the OKRs. Because, this is a management method based on Objectives and Key Results, specifically:
- Objectives (O): The destination you are aiming for.
- Key Results (KRs): The results indicate whether you have achieved the Objective or not.
Thus, Key Result is a quantitative (measurable) factor in the OKRs. KRs help businesses identify Objectives and motivate Objectives achievement and effective performance management.
Key Results measure the level of Objective achievement
>>>> See More: What is OKR? A-Z about OKRs
Purpose of Developing Key Results
In business, each individual will have different thoughts and personalities. Therefore, conflicting opinions while implementing the Objective is inevitable. Without applying Key Results, the Objective will become ambiguous and cannot measure progress toward the Objective.
Therefore, businesses need to identify KRs so that the Objective becomes specific and has a precise orientation on how to achieve that Objective.
Thus, it can be said that KRs are understood as a quantitative measure to achieve an Objective, while an Objective is what you want to achieve. KRs make your Objectives more granular and measurable.
Key Results make Objectives more granular and measurable
>>>> Read More: How do employees in the company create individual OKRs?
Types of Key Results
According to Felipe Castro, Key Results are divided into two basic categories, activity-based and value-based. More specifically, activity-based KRs are those that measure the completion of an important project task or activity. In contrast, value-based KRs measure the value delivered to a business or customer.
For example,
- Activity-based KRs:
- Release the beta version of the website
- Design a new set of products for the Tet program
- Build employer brand
- Value-based KRs:
- Improve candidate satisfaction in the hiring process from 30% to 60%
- Improve customer satisfaction index from 70% to 85%
- Reduce contract cancellation rate from 20% to 15%
Most value-based Key Results will provide better quality and performance than activity-based KRs.
6 criteria of an effective Key Result
Key Results are not specific tasks or projects. We need to define KRs as the final result to be achieved. Consider the following 6 criteria to plan effective Key Results:
- Measurable: Good Key Results need to be measured in an objective way. KRs must have a clearly defined scope and measure the progress towards achieving the Objectives in detail and specificity.
- Relevant: Key Results need to have a close relationship with the stated Objective. Otherwise, the progress toward the Objective will become ambiguous, not achieving good results. KRs are the decisive factor in the success of the Objective.
- Clear: A good result needs to be specific and easy to understand so that everyone can understand.
- Time-bound: Key Results need a clear deadline to create the pressure to accomplish. Normally, Key Results follow a quarterly cycle (90 days).
- Challenging: Key Results must also be challenging and ambitious. To apply the OKRs well, the KRs set should be slightly larger than the employee's capacity. This helps to increase employee productivity.
- Actionable: KRs need to be achievable so employees know what they need to do to achieve them. However, we should not set KRs that are too big and unachievable.
Key Results need a clear time-bound to create the pressure to complete Objectives
How to build effective Key Results
After knowing the 6 criteria of effective Key Results, what are Key Results’ requirements to be effectively built? Follow the below content by Viindoo to know!
Key Result has a strong impact on Objectives
Key Results greatly affect the level of focus on achieving business Objectives. To build effective KRs, it is important to answer the question “Are these KRs really important to OKRs?".
Key Result has a strong impact on Objectives
>>>> See More: 11 Effective Steps to Build OKRs for Business
Key Result needs to be quantitative (with numbers)
Key Results need to be quantitative and measurable. Otherwise, the Objective will be ambiguous and it is impossible to know when it has been completed. This is also one of the very common mistakes when new businesses use OKRs.
If Key Results are not measurable, the Objective will be ambiguous
An Objective should only have 3-5 Key results
According to experts, an individual should only have 2-3 Objectives/quarter and each Objective should have 3 to 5 KRs. This helps employees stay more focused and avoid overcrowding. However, it is not necessary to have 3-5 KRs in each Objective, it can be more or less. Most importantly, each person needs to think about the importance of that KR and choose the right indicator.
Key Results should have specific time-bound
Setting specific deadlines for Key Results builds motivation and increases commitment. Therefore, when using Key Result, employees need to set a clear deadline. If there is no timeline, businesses can default to the deadline at the end of the quarter.
Setting specific deadlines for Key Results creates motivation and increases commitment
Accomplish Key Results concurrently with Objective Completion
After completing the set OKRs, it is important to answer the following questions:
- If certain Key Results are removed, is the Objective achieved?
- If all KRs are complete, is your Objective achieved?
- Is there any other Key Result missing?
If the Key Results have been completed, but the Objective has not been achieved, it means that the Key Results are generated with some errors. To resolve this, businesses and employees can modify or add KRs.
Practical example when writing Key Results
Here is a concrete example of how to write Key Result effectively:
| Objective |
| Improve customer satisfaction |
| Key Results |
|
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