Hi there. So far you've been learning to define and create measurable project goals and deliverables. As you broaden your understanding of project management and the different tools available to help you succeed, I want to teach you about a popular tool used in many organizations and here at Google: objectives and Key results, or OKRs. In this video, I'll discuss what OKRs are, how they are used by organizations, and how they help focus a team's time and effort on activities that drive success. You've just learned about, and practiced, the SMART method for defining project goals. Like the SMART method, OKRs help establish and clarify goals or objectives for an organization, department, project or person. OKRs take SMART goals a step further by combining a goal and more detailed metrics to determine a measurable outcome. They not only state clearly what the goal is, they provide specific details that allow you to measure the success of the goal. One way to think about OKRs is that they separate the different components of SMART goals and clarify them even further, rather than grouping everything into one statement. Let's break this down. The O stands for objective, and defines what needs to be achieved. It describes the desired result or outcome, such as an increase in customer retention, or an improvement on the employee onboarding process. KR stands for key results. These are the measurable outcomes that define when they objective has been met. For example, if your objective is to improve customer retention, then the key result might be to have 90 percent customer satisfaction rating by the end of the first quarter. Recall that one of the SMART criteria is attainability, which means it's practical to achieve the goal. Key results, however, should be a little more ambitious. Here at Google, we actually use OKRs to set stretch goals as a way to challenge ourselves to do something we haven't accomplished before. If we actually accomplish all of our key results, we may have made our OKRs a bit too easy. Let's review quickly. Objectives define what needs to be achieved and describe a desired outcome. Key results define how you'll know whether or not you've met your objective. How do OKRs work in practice? How do you use them to manage a project? Organizations often set OKRs at different levels, such as the company level, department or team level, and project level. Company-level OKRs are commonly shared across an organization so that everyone is clear on the company's goals. They are usually updated on an annual basis to help drive the organization in the direction it wants to go. These high-level OKRs support the mission of the organization. Project-level OKRs should support and be aligned with company-level OKRs. An example of a company-level objective at Office Green increase customer retention by adapting to the changing workplace environment. This is a big, aspirational goal that applies to the entire company and all of its endeavors. In order to focus their efforts to reach this objective, Office Green might develop key results that include 95 percent of phone, chat, and email customer support tickets are resolved during the first contact. Top three most requested new offerings for distributed office environments are in pilot by the end of the second quarter, and sales and support channels are available 24/7 by the end of the year. Some of these company-level key results could become the basis for projects. For example, the key result, "top three most requested new offerings for distributed office environments that are in pilot by the end of the second quarter," could become the Plant Pals project. Team or department-level OKRs, support the company's broader OKRs and help drive team performance. Departments may develop OKRs that are more specific to their job function as well. For example, the company-level key result "sales and support channels are available 24/7 by the end of the year," could lead to a related sales department objective like: increase the sales team presence nationwide. And the key result: new sales offices are open in 10 cities by the end of the year. Project-level OKRs are set during the initiation phase to help define measurable project goals. There're tracked throughout the planning and execution stages to measure project success. Project-level OKRs need to align with and support both company and department-level OKRs. For example, in order to align with Office Green's company-wide objective to increase customer retention by adapting to the changing workplace environment, a project objective for Plant Pals might be to enroll existing customers in the Plant Pals service. A key result for this objective might be 25 percent of existing customers sign up for the Plant Pals pilot. Let's recap. OKR stands for objectives and key results. They combine a goal and a metric to determine a measurable outcome. Objectives define what needs to be achieved and describe a desired outcome. Key results define how you will measure the outcome of your objective. Company-level OKRs are shared across an organization so that everyone can align and focus their efforts to help the company reach its goals. Project-level OKRs help define measurable project goals. They need to align with and support both company and departmental-level OKRs. Great. Now that you have a better idea of what OKRs are and how they function, you can practice creating OKRs on your own.
