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‘Silicon Valley’ companies have become synonymous with immensely successful tech companies. Take a look at some of the most impressive names on the list. Google, HP, Apple Inc., Facebook, LinkedIn, etc. Most have had very humble beginnings. Some started from a garage, some from warehouses or in a similar fashion. Today they have become global giants in their respective fields.


Are there any secrets for their success? Was it their determination to succeed that paid off spectacularly? Was it their ability to hire the most talented employees? Should the credit go to their visionary leadership? Does it have anything to do with the way they set their goals?


The answer is all of them. While each one of these greats have their peculiar reasons for staggering success, there is a common pattern one would notice amongst them. All of them were singularly focused. And the founders managed to pass on that focus to the ever-increasing team. Now, that’s not a mean feat. The management needed an efficient goal setting process to capitalise on their talent pool. A number of companies relied on Objectives and Key Results or OKRs, one of the most popular goal setting framework. It has been instrumental in the success of Google, LinkedIn, Sears and couple other big names.


The concept of Objectives and Key results (OKRs) was introduced by Andy Grove at Intel in the 1970s. Though it was largely made popular by John Doerr when he implemented it at Google in 1999. Both companies saw astounding success through its use. Intel launched the Intel Inside campaign which was an instant hit and became a household name. Google adopted OKRs when they were just at 40 employees and continue to use it across the entire organisation to this day.


How OKRs helped Silicon Valley companies:


Most of these Silicon Valley companies have grown at an alarming pace. They could not stick to traditional way of setting goals due to its rigidity. Before that management used to set annual goals which were not able to take into account any change in situation. Their goals needed to keep on changing at frequent intervals to match their ambitions. This wasn’t going to be helpful for the companies run by ‘millennials’. That is where rise & rise of OKRs started.


OKR Methodology recommends setting only 3-4 objectives for all the individuals, teams and at the company level. They need to be created using the SMART principle i.e., specific, measurable, actionable, relevant and time-bound. Each of these objectives should have 3-4 quantifiable key results that determines if the objective has been achieved. This video by RIck Klau on OKR methodology explains everything in more detail.


For example, Google set 3-4 objectives at company level for longer terms, mostly annual. As they were strategic in nature, they did not want to change these after every quarter. For every team and individual level, OKRs were set for every quarter and achievement determined their progress.


Today Google is a multi-billion-dollar company yet it stills sticks to OKR methodology for their internal grading system. They have developed their own tool to help them better utilise this concept.


Companies outside of Silicon Valley are starting to adopt OKRs:


In recent years, many startups have come up. They have dared to take on established companies and capture a bit of the market for themselves. Unlike large companies, they have limited resources and need to make the best out of them. The greenhorn founders need to make their processes as efficient as possible if they hope to succeed.


Silicon Valley teams are early adopters. They saw the potential in OKRs & were nimble enough to make good use of them. Now the startup hubs, outside of Silicon Valley, have a few hugely successful models in front of them (read Google, LinkedIn, Zynga etc.). Being startups they are pouncing upon this opportunity to align team efforts in the right direction.


It is no wonder that OKRs are increasingly being adopted by companies the world over. However, not all are able to leverage on its capabilities. Often, mismanagement has let to companies abandoning OKRs completely. It is highly recommended that you systematically integrate the process in your organisation than on a whim.


About the Author


Yatin leads the Marketing and Content writing efforts at Amoeboids Technologies for UpRaise, a performance management add-on for JIRA. Fascinated by all things Marketing, everyday he seeks to learn best practices and new concepts to help his company grow. A voracious reader, Yatin enjoys reading fiction, fantasy and mythological novels in his leisure time. You can find him on LinkedIn, Twitter, and Medium.