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Your OKRs guide: Why this goal-setting framework is essential

If I told you there was a practical way to align everyone in your company to one big ambitious goal, would you believe me? There's no catch or secret, it simply comes down to a whole lot of dreaming and implementing OKRs.
5 min read
Your OKRs Guide: Why This Goal-Setting Framework is Essential

If I told you there was a practical way to align everyone in your company to one big ambitious goal, would you believe me? There’s no catch or secret, it simply comes down to a whole lot of dreaming and implementing OKRs.

If the term is new to you, don’t fret – OKRs have only risen to fame in the last 20 or so years after OKR advocate, John Derr, introduced the management framework to the team at Google in 1999. Google grew from 40 employees to its current 60,000 employees off the back of this performance framework. Silicon Valley rapidly adopted this highly-effective people strategy and now OKRs are used in some of the world’s most innovative companies. Cool story, huh?

Even though OKRs are used at companies like Deloitte, Asana, Netflix and Salesforce, we’ve found that many of our clients have never heard of this concept before.

An intro to OKRs

So what are OKRs? In what ways are your OKRS influencing your top company objectives? How can you use them in your business and just why are they so damn great anyway? Let’s dive in!

What are OKRs?

Objective key results (OKR)

OKRs stands for:




OKRs consists of an Objective, which defines a big goal to be achieved (the ‘what’ or ‘where do we want to go), and up to 5 Key Results, which measure progress towards the objective (‘how do we know we’re making progress?’).

Each OKR can also have Initiatives, which describe the work required to drive progress on the key results. We suggest starting with a maximum of 3 to 5 key results and adding more as your company gets familiar with the framework.

OKRs are created top-down and bottom-up. The only top-down OKRs should be your company level OKRs. From there it’s up to each person and / or team to establish their employee OKRs together. This gives your employees the opportunity to have a say in how they, in their role, will help to achieve the company OKRs. They are also designed to be publicly seen and set for everyone inside the business. This means all employees, whether junior or senior, know what is expected of them. This transparency helps to cultivate a culture of trust and team spirit.

How can I structure OKRs?

How do you go about structuring and explaining employee OKRs? Let’s break it down further:

Step 1: Start with the Objective

croissant on a plate

What do you want to achieve? Where do you want to go? Your objective is your big goal. We’ll use the example of a fictional bakery, The Frosted Frenchman.

The Frosted Frenchman wants to be known for having the best croissants in Australia. This is now their objective: ‘Have the Best Croissants in Australia. 🥐

Step 2: What are your Key Results?

The french bakery awards

What do you need to do to achieve the objective? How are you going to get where you want to go? Your key results are the actions you need to take to reach your top company objectives.

If we go back to the bakery analogy, the key results are your benchmarks of success. So for The Frosted Frenchman, one of their key results would be: ‘Win 3 bakery awards this year’.

Step 3: What are your OKR Initiatives?

staff holding bread in a bakery

We haven’t mentioned initiatives yet, but initiatives are important in ensuring the success of your key results. Initiatives sit under key results as the activity that was taken to achieve them.

An initiative can be considered as the actual steps you take, like, ‘Enter 10 competitions this year’or, ‘Taste and research prior winner’s croissants’Put simply, your initiatives are a to-do list of how you achieve your key results.

If we think about the analogy above, you can see how the OKR is broken down into logical steps. The Frosted Frenchman wants to be known for having the best croissants in Australia (Objective), so what do they do? They need certain things to happen, like winning awards for it (Key Results). Finally, what do they need to do to win those awards? (Initiatives).

Example of OKRs in HR and People and Culture

Let’s show an example of what an employee engagement OKR could look like for an HR/people and culture manager:

Objective: Improve Employee Engagement

Key Results:

  • Increase employee participation by 10% in the quarterly engagement survey
  • Increase employee satisfaction by 5% as reflected in the quarterly engagement survey
  • Leadership commit to 4 action items related to feedback
  • Communicate action items and leadership owners/champions to business through all-hands meeting and internal newsletter by (specific date)


Take the Key Result, 2. Increase employee satisfaction by 5% as reflected in the quarterly engagement survey

An employee engagement OKR initiative to help achieve this would be:

  • Brainstorm with key culture influencers what they want to see improved or introduced

Pro tip: Make sure you give yourself a timeframe to achieve your OKRs.

OKRs vs. KPIs

We wouldn’t blame you if you thought that employee OKRs are set to replace Key Performance Indicators (KPIs), both measure performance and success within a business. However, there’s actually a few key (sorry) differences.

OKRs are to help you achieve grand, ambitious goals. They’re designed with an aspirational goal in mind, rather than a specific tangible outcome. Qualitative. 

KPIs, on the other hand, are tangible outcomes with measurable results. Quantifiable.

An example of a KPI would be:

  • Internal newsletter open rate

An example of an OKR would be:

  • Improve Employee Engagement

KPIs are more similar to key results, rather than OKRs on the whole. You can use KPIs to work hand-in-hand with key results. If we look at the example above we could use the KPI of ‘Internal newsletter open rate’ to help influence a key result for the OKR, ‘Improve Employee Engagement’. Let’s put it in action:

O: Improve Employee Engagement

KR: Increase average internal newsletter open rate from 60% to 70%

OKRs and KPIs work wonderfully together. Consider the OKR example, ‘Having the best croissants in Australia’, a KPI for this OKR would be ‘x number of awards won’ or a ‘5-star rating on Google’.

Best OKR software

Before choosing an OKR software, there are a few features you should look out for when deciding whether it’s best for your business.

  • Tailor-made for your business. Every business is different, OKR software isn’t a one size fits all kind of solution. Instead, you should look for software that allows you to tailor your OKRs to meet your business’s needs.
  • Flexible and scalable. Sometimes minor tweaks need to be made to your OKRs depending on your team’s focus and size. So your software should be able to adapt and change as your business does.
  • User friendly. It’s important that you choose an OKR software that can be easily integrated into your team. The focus should be on achieving your OKRs, not trying to figure out how to use new software. Have a look and see whether certain aspects need more attention to detail than others. If that’s the case, you might want to consider a team training session.
  • Able to reflect progress. Your OKR software should be able to give you insights into your team’s progress in achieving them. Not only does this help track how your OKRs are going, you can also use this information to develop your employee performance reviews. 

OKRs in Employment Hero

We liked OKRs so much, we made sure they became a key feature in the Employment Hero platform. If you’d like to find out more, watch OKRs in action.

Download our guide to OKRs and take your business to the next level today.

Download now

Your Guide to OKRs

Ben Thompson
CEO and Co-Founder - Employment Hero
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