Building Aligned OKRs That Drive Team Execution

Every team can hit its objectives and still leave the company short of where it needs to go.

That can happen when teams create objectives and key results (OKRs) in a vacuum. They choose priorities without connecting them to the company’s longer-term direction. Or they build plans independently, leaving the connections between teams to be figured out later.

The result is a collection of team goals with little shared understanding of how the organization will achieve them together.

Over 25 years working with hundreds of leadership teams, I’ve learned that the value of OKRs comes from the clarity and commitment teams build around them. Done well, OKRs help develop the organizational capabilities needed to achieve one-year objectives and reach the metrics the company has set.

Here’s what matters most.

Connect OKRs to the bigger picture

A common mistake is choosing OKRs based on whatever feels most urgent at the start of a cycle. The team gets focused, but its focus may have little connection to where the company needs to go.

Longer-term objectives give that work context. A three-year vision describes the direction. A one-year plan defines what the organization needs to accomplish along the way. OKRs connect the next 90 or 180 days to that larger picture.

The leadership team’s OKRs should be anchored in the company’s one-year plan. Each team’s objectives should reflect that direction and what matters most for its own contribution.

That connection helps teams make better choices about where to invest their time, talent and resources. People can understand why the work matters.

Build alignment across a team of teams

Connection to company direction is only part of alignment. Teams also need to understand how their plans connect to one another.

Sales may be preparing to enter a new market while product is focused on existing customers. Both teams can make progress against their own objectives while leaving a critical company priority unsupported.

That’s why it’s important for cross-functional teams to build aligned OKRs through a team of teams model. Each team has its own responsibilities, but its success often depends on commitments from other teams.

Rigidly cascading every company key result down through the organization can miss those realities. Teams also need to build capabilities—such as platform reliability—that may not fit neatly beneath a current company key result.

Alignment requires room for those needs, alongside a shared understanding of dependencies and competing priorities.

This approach works for an early-stage company with one core team and grows with the organization. The system stays consistent; the number of coordinated teams grows.

Go beyond agreeing on objectives

Teams often put their energy into deciding what they want to accomplish, then give too little attention to the key results.

The objective is the what: what the team wants to accomplish.

The key results are the how: what the team needs to build, change or deliver to achieve it.

Each key result needs an observable outcome. People should be able to answer: “What does this look like when it’s done?”

Without that clarity, people can agree to the same words while imagining different outcomes. They may discover those differences only after work is underway, when changing direction costs time and creates frustration.

Building key results together surfaces those differences earlier. Ownership, timing and contributions from others become shared commitments. This is especially valuable for cross-functional work, where no single person or function can deliver the outcome alone.

The conversation is part of the value. It builds the shared understanding people need to execute together.

Make progress visible

Plans lose value when only the people who created them can see them. Sharing each team’s one-year plan and OKRs across the organization makes priorities, dependencies and commitments visible. It also reveals when several teams are depending on the same people or resources at the same time.

That visibility also needs a connection to results.

Metrics—the number-based goals defined from one-year objectives—provide a guiding light. Some are key performance indicators (KPIs); others track important conditions, such as runway.

OKRs focus attention on building the capabilities needed to reach those goals. Metrics help teams understand whether that work is producing the intended results.

Together, they help reveal execution lift or execution drift. Completing the work matters, and so does understanding whether it moved the organization forward.

The real test of aligned OKRs is whether people understand the bigger picture, their contribution and the commitments connecting their work to others.

When those connections are clear, OKRs become a way for the organization to execute better together.

About the author

Jeff James Martin is the founder and CEO of Collective Genius, an organizational execution company that helps founders and leadership teams execute better together. He is the creator of Peak OS, the company’s system for connecting direction, alignment, execution and learning across the organization, and author of Peak Teams.