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The Role of Corporate Strategy in OKRs

So we know that OKRs (Objectives and Key Results) are a goal setting framework, but what exactly is their link to strategy?

We often see clients coming to us to request we help them implement OKRs in order to resolve a particular pain point within their business. The most common pain that we currently see tends to centre around staff performance, engagement and alignment. This is all well and good, and OKRs if implemented properly will help relieve the pain in all those areas, but it is slightly missing the point. OKRs aren't just a tool that can be applied like a sticky plaster over an injury, they are a different way of thinking and approach to how the business operates. Without linking everything back to the primary goals of the organisation the true power of OKRs is completely lost. So, rather than healing the injury, this is about avoiding getting it in the first place.

And this is where the corporate strategy has to come in. OKR development and implementation is a bi-directional process, it has to come from both top down and bottom up. By that we mean that the start point for any implementation has to be a clear understanding of the top level organisational goals, and from that an understanding of the key priorities for the next 12 months. Only once these are understood and clearly communicated throughout the organisation can the bottom up process take place, whereby the teams and in some implementations individuals define how they will contribute to those top priorities through their own activity (alignment). What will they prioritise in order to help the business along its defined path?

But there is still a potential issue here... what if the top level, strategic goals haven't been properly considered? What if the process used to define them falls well short of best practice? The fundamental problem this creates is that the organisation might well be fully aligned behind a set of goals, the teams fully engaged in the process and all pulling in the same direction of travel, but what if it turns out that the direction of travel is taking us off course.

This is why whenever we are invited to assist organisations with their OKRs, our first port of call is always the corporate strategy, and the process used to define it. This doesn't mean we'll come in and deconstruct everything that has gone before, not by any means. But it does mean working with the c-suite to conduct a thorough review of the fundamental elements such as Vision, Mission and Values, and understanding the thinking behind the corporate goals and how they fit in. These are the building blocks, the foundations, of corporate strategy and everything is cascaded downwards from there, so a clear understanding is critical.

Our long background in strategy development and the use of best practice models and tools, particularly strategy maps and balanced scorecards, lends itself well to this process, and once everything is understood and the link between top level strategy and the underlying OKRs that will help to deliver it is defined, then the process of OKR development and implementation can truly take place. That staff alignment and engagement issue mentioned at the outset will be addressed by the very process of developing Objectives and Key Results themselves, whilst performance management naturally falls out of OKR delivery through the ownership of activities and the application of a scoring system.

So what is the role of corporate strategy in OKRs? The simple answer is without a rock solid strategy developed using a best practice approach, building and implementing OKRs that effectively move the organisation in its desired direction of travel simply aren't possible.


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