22 Jan
Try using OKRs to aid your annual planning exercise to experience the agility it offers to the process and how it makes sure that you achieve your goals. The steps to follow are simple:
- Set a Business Goal
- Define OKRs with context to achieve the goal
- Get all team leaders involved
- Map every task to drive objectively key results
- Monitor and Measure the results
- Share real-time 360 degree feedback with the teams
- Be agile and re-align OKRs if necessary
- Leverage technology for creating a robust performance environment
Learn how PossibleWorks can help you
Among the takeaways companies got from the COVID-19 situation and its challenges, the need for agility must rank pretty high! What use annual planning if circumstances change drastically that the objectives become impossible to achieve, while no one knows what to replace them with? As a quote attributed to Helen Keller puts it, a bend in the road is not the end of the road, unless you fail to make the turn. Organizations woke up to the fact, when first challenged by the pandemic, that changing their course midway and reorienting everyone in a different direction wasn’t easy. Figuring out the best direction was also not easy, given that no one really knew how to face the unprecedented situation.
Businesses need to be able to quickly reorient themselves to work towards valuable opportunities and orient the business-wide teams to follow suit. The ideas need to be formulated and approved quickly to ensure that the business doesn’t lose its momentum. Or lose their efficiency as the teams wait for months for approvals, funding or resources to support their endeavours. Set your annual goals for annual planning using Objectives and Key Results aka OKRs to stay on track with your objectives, and measure them as needed, to reorient your OKRs suitably to enjoy enormous agility. OKRs offer a powerful and agile goal-setting process, which allows progress to be measured at any time and corrected as and when needed.
How to use OKRs for annual planning
In an earlier blog, we have explained the benefits and best practices in setting OKRs. They are especially useful for leaders who wish to set and communicate their goals to the entire organization. They can also track the results, as they work to achieve their goals. It helps them to align the performance and engagement of their employees, taking a holistic approach. Objectives help you define what you want to achieve in a qualitative manner while key results help you measure that performance in a quantitative manner. The ultimate goals of success and profitability are never lost sight of, when OKRs are set following the following broad strategic steps:
Choosing the OKRs
- Have a clear idea of what needs to be achieved in the specific year before you pick an OKR as your goal or objective for the year.
- Make sure that every one of them is an inspirational goal which need no further explanation.
- Make them object-oriented and achievable. Aspirational goals take a long time to be achieved and may offer success only after a few failures.
- Connect your OKRs to your organizational values, mission and vision. This helps because the mission keeps you focused on achieving the day-to-day activities, while the vision helps you dream of a future, when you have succeeded in what you set out to do. Values inform your business strategy and execution and guide you on the way to conduct business.
- Always quantify the objectives as well as key results.
Annual Planning OKRs
- Define and align them from an annual level to quarterly level.
- Most organizations aim high and set ambitious OKR goals and settle for anything above 70% in achievement. It helps to make OKRs actionable and time bound too.
- Keep in mind not to pick general actions as OKRs or make them unrealistic or highly specific.
What and How many to pick?
- Limit the number of objectives to around 3. You can settle for just 1 too.
- Make sure everyone knows what would help to drive the business to grow.
- Too many objectives are demotivating and may be discarded by teams.
- Specify 3 to 5 key results to help measure the outcomes and thereby, performance. Never set tasks as key results. Ensure that every team member is focused only on the outcomes.
Manage the OKRs across Functions
- Make sure that the different teams in the organization have aligned objectives.
- Involve every one of the teams in the organization in the discussions, so they can understand the priorities and ensure that their individual/team-level goals align right with the organizational goals.
- In this process, ensure that everyone is trained on using the OKR framework and get familiar with the best practices in setting them, so as to get their own OKR plan right.
Leadership and Team-level Participation:
- Setting OKRs for annual planning would need the participation of everyone from executives to senior leaders. Ensure that all the key stakeholders are brought on board.
- Leaders need to stay committed to the OKRs set if teams are to follow.
Track and Measure the Performance
- Set up regular reviews to measure the performance.
- If all your resources are not being used to achieve the OKRs, revise them to make them more specific and efficient.
- Check if you have excess resources and need to downsize.
- If the results do not meet expectations, it’s time you reviewed your OKRs.
- Focus on Q1 OKRs to set the activities rolling in the new year.
Agile Annual Planning
- Depending on the size of your organization, schedule a few early meetings – about 4 to 8 weeks before commencing the annual planning – so that everyone can pitch in with their thoughts on what to prioritize as the goals of the business.
- Think of your previous year’s performance and the effects of the COVID-19 pandemic on achieving your goals and factor in the constraints which we are continuing to face.
- Bring forward some goals if you wish to achieve them this year.
- Schedule regular check-ins and with a mid-quarter review, in each quarter, to take stock of the progress being made towards achieving the goals set as a part of annual planning. Revise the OKRs to ensure that the annual planning process stays on track even if there’s a slip-up in one quarter due to unforeseen/unavoidable circumstances.
Consider adopting a technology platform to help you manage the whole annual planning process using OKRs as you set effective OKRs, and regularly track, measure and monitor them. Learn more about performance management systems and OKRs:
