Table of Contents
What You Need to Know About Strategic V/S Tactical OKRs.
The Objectives and Key Results (OKR) framework is an action-oriented execution framework used as a popular goal-setting tool by individuals, teams, and companies. They are a powerful tool that aids in bringing focus towards company objectives and act as a tracking system to measure the progress towards these objectives. There are two main types of OKRs with varying usage: strategic and tactical. In this blog, let’s take a look at these two types to determine which one you should choose for your business.
What are OKRs?
The OKR framework is used to set objectives and track the progress towards those objectives. Large and small companies adopt this framework, which has historically been successfully executed by multinational tech giants such as Google and Intel.
According to John Doerr, the author of Measure What Matters, it is a planning method; OKRs are continually set, tracked, and re-assessed – typically quarterly to measure key results and make any necessary changes. Thus, this makes OKR a simple and fast-cadence process that encourages team creativity and cooperation. It is important to note that companies must track OKR results to see if any changes are needed.
The two main components of the framework include:
Qualitative objectives are descriptions of what you want to achieve. They are usually short, clear, inspirational and aspirational. The objective answers the question of ‘WHAT?’ To have objectives with greater impact, it is better to set 3-5 focused objectives.
These are a set of metrics that measure your progress towards the Objective. This answers the question of ‘HOW?’ For each Objective, it is advisable to have 2 to 5 Key Results for better tracking of progress.
Some of the key benefits of using OKRs include:
- Better goal alignment and goal-setting strategies
- Increased employee engagement
- More transparent company culture
- Creation of a goal-oriented environment that helps individuals and teams thrive
- Better teamwork and motivated team members who are aligned with company goals
Let’s look at how to set OKRs for your business through these two helpful example templates.
A customer success OKR would look like this:
Be Proactive with Customer Success
Key Result 1
Establish 2 customer success platforms to keep track of customer health
Key Result 2
Generate 200 positive customer reviews online
Key Result 3
Reach out to customers who appear to be at risk and increase customer satisfaction rate by 10%.
A quality assurance OKR would look like this:
Improve quality control processes to create defect-free products.
Key Result 1
Reduce the number of defects by 30% by installing new spare parts for production machines.
Key Result 2
Increase the efficiency of testing processes by 30%
Key Result 3
Increase customer satisfaction with high-quality products by 35% and increase online review rates.
What are Strategic OKRs?
OKRs and strategy are deeply interconnected. Any company’s well-intended strategy can be made into reality with good OKRs.
- Strategic OKRs are high-level OKRs that help businesses continue and execute company-wide goals.
- They help focus on the larger goals, which are typically set by the company’s executive-level managers or any other high-level personnel.
- They share OKRs with the entire organisation to get them on board and improve the employees’ contribution to the company.
- These OKRs can be very aspirational or committed, depending on their requirements.
- They can rely on the existing skills or require more to push the employees out of their comfort zones.
Since they align with a company’s long-term goals, their measurable outcomes can have a significant impact on the company. They are set for a year or more but usually less in number. They prioritise the company’s key strategies. Examples include releasing new products or adopting new technologies or machinery.
What are Tactical OKRs?
Tactical OKRs assist both individuals and departments in focusing on lower-level goals.
They are related to the company-wide strategic goal.
They are indirectly connected to the bigger picture— much like how it is through parts that a whole is made, tactical goals support strategic goals. These are usually set by mid-level or lower-level managers to handle the day-to-day operations of the compareal-timee tracked in real time.
Tactical OKRs have lower-level objectives and are designed to be attained within a shorter period, such as a quarter to improve regular operational efficacy. Some examples include improving customer satisfaction or reducing overall expenditure.
OKRs: An Integral Part of any Company
The difference between strategic and tactical goals can be compared to the difference between a part and a whole. The difference can be summed up as follows:
|Strategic OKRs are aligned with the organisation’s long-term vision for improvement
|Tactical OKRs deal with achieving goals related to the organisation’s day-to-day operations.
|These ensure that the organisation lasts in the long run.
|These take care of the everyday improvement of operations.
|These are usually set by the company’s executive-level managers.
|These are usually set by mid-level or lower-level managers.
|They focus on the company’s short-term goals.
|They focus on the company’s long-term goals.
Both these OKRs complement each other—the strategy specifies the path the company wants to take in terms of growth and success, while the tactics are the map towards that destination. Companies must balance the two to ensure continuous improvement in performance and goal-setting.
Are you looking for help learning how to use OKRs? Sign up for free today and gain access to all the benefits of OKR software.