So what makes a great KR? A great KR is one that is available, and scores highly on the 5 criteria of signal strength.
Every organization has an abundance of data, the challenge is finding what is the right data to use as a measure. Once you’ve grabbed your list of available measures, there needs to be some way to filter the list down the optimal group. This is where I like to use a concept called signal strength. Think of the WiFi bars on your computer or data connection on your phone – they tell you what the strength of your device’s connection is; an indicator of how fast you can download, or even how far you are away from the source (router or cell tower). Applying this concept to business, we can measure the signal strength of KRs using 5 different criteria:
- Relevancy – How closely related is the indicator to actual performance across normal scenarios?
- Predictability – Does a shift in this measure predict the future performance of the target area?
- Auditability – Can an independent third party assess the accuracy of this measure?
- Comparability – Is the data collected from a process that is repeatable across locations/ products?
- Vivacity – Does the measure inspire, engage, and allow for team/individual contribution?
The reason those 5 criteria are important is they solve the need of KRs – is the KR relevant to the objective, can we rely on its values, will others believe us, can it highlight comparisons, and does it inspire us to hit those goals. Once you score your potential KRs on each of the above criteria (generally from 1 to 5), you get a distribution indicating which are the great KRs, and which ones maybe aren’t so great.
Don’t be worried if your favorite KR doesn’t have a high signal strength – a KR may have a weak signal strength for one objective, but a strong signal strength for another. You can always check if your KR fits in better with another objective. That being said, successful OKR systems have as few KRs as possible provided they cover the essence of what you’re trying to achieve. So if your favorite KR doesn’t make the cut, be happy that you’ve improved the business!
