OKRs For Product Management
Product managers are versatile thinkers by nature. One minute you might be discussing nitty gritty code issues with engineers and the next you’re discussing the desires of your customer base.
You’re responsible for a productive harmony among the individuals in your cross-functional team. It helps to have a common language to frame common goals, and a structure that works well for everyone.
This is the beauty of OKRs: Objectives and Key Results. In this explainer, we’ll lay the fundamental facts about OKRs, how they’re made, and how you can use them in any business to aim for moonshots.
The Origins of OKRs
The first OKR structure was created in the 1970s by former Intel CEO Andy Grove, but most people know about it because of modern Silicon Valley. Grove taught OKR strategy to investor John Doerr, who brought the idea to a one-year-old startup called Google.
The list of tech titans that have credited OKR with their rise includes LinkedIn and Zynga.The tools and strategies that made these companies prosper are at their core very simple and available to you.
What is an OKR?
The Objective and Key Results (OKR) methodology is a collaborative, goal-setting framework that helps teams and organizations reach their goals through identifiable and measurable results.
OKRs are composed of two main components:
- Key results
The objective is what you’re trying to accomplish. It’s a qualitative, aspirational statement.
Every OKR has one objective, such as…
- Better platform integration
- Amazing usability
- More engaging tools
Objectives are broad for a reason: they encourage your team to dream. Specific outcomes are the realm of key results.
Key Results (KRs)
The key results are specific ways that you’ll measure whether you achieve an objective.
A key result must be quantifiable and verifiable – no room for ambiguity. An OKR has numerous KRs – we recommend at least 3 per OKR.
Examples of Key Results….
- User platform integration increases by 9%
- Average customer experience rating for Salesforce integration of 4 stars or higher
- Create 2 new integrations for sales-based CRM platforms
The key results, like the objectives, are supposed to be reasonable but ambitious for your team. As we’ll discuss below, you want to set OKRs that you can achieve, but not so easy that you always achieve them 100%. The goal is to always be pushing your team to the limit of its ability.
OKRs are not roadmaps
A lot of businesses use roadmaps to ship and update products on a steady timeline, and it’s great for that. But this focus on output, rather than outcome, can create a short-sighted vision for your work.
OKRs, by contracts, are outcome focused. The outcome is the change that results from the work you put out. It’s not about the latest product update – it’s about how that update will help make you into the company you want to be.
OKRs are not KPIs
Key Performance Indicators are useful in their specificity, but they’re not often tied to broader business goals. It’s like setting key result goals without over-arching missions to guide them.
A product team, for example, might aim to decrease latency with certain software tools. This is an admirable target, but how does it connect to larger business goals? OKR, by contrast, builds those connections into the earliest planning stages.
How To Design OKRs
The best OKRs are those that improve people’s focus, creativity, and productivity. It’s worth repeating: objectives should be actionable, time-bound, and ambitious. Key results should be clear and quantifiable.
We caution people against taking on too many OKRs at once. Too many challenges can spread your attention and time too thin. In a given business quarter, we recommend no more than 3 objectives. For each objective, we recommend 3 to 5 key results.
The basic OKR structure
“We will __(Objective)__ as measured by __(these Key Results)__.
OKRs for Product Management: Examples
The open-ended nature of OKRs is one reason why they can be adapted to any department in a business. Product management is no different. Here are some product management OKR examples from different parts of a team’s work.
Identifying user needs
Objective: Understand user needs and desires
- KR1: Survey 200 users
- KR2: Analyze data from 100% of Q1 help desk requests
- KR3: Create 10 new use cases
Design + Development
Objective: Create an irresistible interface
- KR1: Increase average user time by 5%
- KR2: Increase user messaging within platform by 3%
- KR3: Decrease subscription attrition by 2%
Objective: Users are our un-official marketing team
- KR1: 55 or more new subscriptions with referral code each month
- KR2: Organic mentions on social media increase 4%
- KR3: Positive product reviews (3-star or higher) increase 10%
Objective: Users empowered to solve their own problems
- KR1: Create 200 new entries for Troubleshooting archive
- KR2: Number of help desk tickets decline 3%
- KR3: Increase chatbot response time by .5 seconds
Objective: Better team meetings
- KR1: Agenda for every meeting set 1 day in advance
- KR2: 100% of team updates take 5 minutes or less
- KR3: Weekly anonymous survey shows average satisfaction rating at 80%