How to evaluate OKRs
OKRs are graded on a scale between 0.0 to 1.0.
Each Key Result is graded, then the rough average of the Key Results used to create the Objective’s grade. Here’s an example of an OKR evaluation for the Head of Marketing at Degree:
When evaluating OKRs, keep in mind…
- Two kinds of key results: Binary key results (i.e. launch a new website) are rated as a 0 or 1, while numeric key results (i.e. contact 10 journalists) are rated as a percent complete.
- 0.6 - 0.7 is success: lower scores might mean the organization is underperforming, while higher scores mean the OKR wasn’t set high enough. This practice of stretch goals might feel uncomfortable at first, but when put to good use helps an organization reach new heights.
- Below .4 is not necessarily failure: a low rating might indicate a super ambitious goal or poor performance -- either way it’s a useful data point to calibrate individual and team priorities and improvements in the coming quarter.
- OKR grades are not a performance evaluation: OKRs can be used as one lens to evaluate an individual (or organization), but are not a comprehensive method of analyzing performance. If OKRS are synonymous with performance evaluations, than individual contributors are systematically encouraged to sandbag their goals to show success. This dynamic limits the upside of the OKR model.
- OKR recap meetings are essential: at the beginning of every quarter, the company should get together and discuss how they measured up to the OKRs. The setup of this meeting will change depending on your company’s size, but typically each team leader will explain the OKR grades and discuss adjustments for the upcoming quarter.
By running through this process, you’ll get useful data about company performance, learn from challenges and optimize for the future.