HR teams take on more responsibility and projects every year to take care of the organization’s most valuable asset: People. They frequently face the challenge of having too many projects at the same time and trying to do everything at once. Developing HR OKRs is one of the best ways to prioritize initiatives and focus efforts in the right direction. OKRs help establish a data-driven approach to HR achieving their goals and contribute to organizational goals.
What are HR OKRs?
HR OKRs (Objectives and Key Results) help HR teams set structured and data-driven goals and help them quantify their results. It provides a framework for establishing human resource objectives, observing key results, and achieving goals within the HR function that impact the organizational goals.
- Objectives – An objective describes a measurable action that an employee needs to take to achieve something in the future. It describes where you want to go.
- Key Results – A set of metrics that are used to measure how you are tracking where you are with the objective. It describes how you will get to your objective.
- Initiatives – All the activities and tasks that will help you achieve your key result.
Teams and organizations typically set annual OKRs and then break them down into quarterly key results.
Good objectives and key results should be ambitious to push the company to the next level. Objectives communicate an ambitious vision, while key results measure your progress towards that objective. This means that key results can be measured on different scales (e.g. from 0 to 1.0, from 0% to 100%, but also in dollars or euro amounts, depending on the KPI that was set).
In the example from Atlassian below, a 0.7 score indicates that you have met your key result but have not exceeded them. Any score below that suggests that there is room for improvement.
If you have a score of 1.0, it means that you either did a very good job or your key result was not ambitious enough. Scoring below 1.0 is not a negative, as your OKRs are meant to be ambitious. These are referred to as stretch goals.
Think of OKRs in the following way:
HR OKR best practices
1. Align your OKRs with organizational goals
The first best practice is to align your HR OKRs to the broader organizational OKRs, as your main goal is to add value to the business.
Then translate those to your sub-departments (Recruitment, HR Operations, L&D, etc.). Some objectives (e.g., delivering the world’s best digital HR services) require departments to work together. The different KRs that help realize this objective can be worked on cross-functionally. The initiatives required to achieve these KRs can be assigned to smaller teams or individuals.
Secondly, crucial conversations need to take place at the leadership level regarding which objectives to set. It should be about the priorities for the year and ensure cross-functional collaboration within the HR department.
2. Work top-down and bottom-up
OKRs provide organizations with a framework to set strategic objectives top-down and contribute to this strategy bottom-up.
Annual objectives are set by the board or executive committee. Objectives are then cascaded by middle management into different key results, often with input from their teams. Individual team members can tag onto specific KRs and propose initiatives on how they can contribute to the organizational objective. This means that OKRs require both top-down and bottom-up support to be successful.
This also means that both the senior leadership team and the rest of the organization need to be enabled before effectively working with and implementing OKRs in the organization.
3. Understand what makes a good OKRs
An effective OKR should consist of a meaningful and inspiring Objective and SMART (Specific, Measurable, Achievable, Relevant, Time-Bound) Key Results that help you achieve the objective.
In short, a good HR OKR should be measurable, realistic but ambitious, and verifiable. Importantly, it should also focus on improvement and growth. Aim for between 1 to 5 objectives per quarter.
4. Make sure your OKRs are strategic
Your OKRs are meant to push your organization in the right direction. As a result, it needs to have elements of planning, review, and feedback. Workpath suggests a framework to ensure your OKR process is thorough:
- Announce your organizational / HR Priorities – Each year, your HR team has to decide on what the focus for the year would be. It gives a rough direction of how each department would draft their OKRs. For example, a priority for the year might be to automate all HR processes. As a result, all HR departments can include automation as part of their OKRs. Each head of the HR sub-department can then develop their OKRs based on these priorities.
- Alignment workshop – All heads of departments, OKR owners, and leadership members should have an alignment meeting. This ensures all areas are covered and removes any obstacles to achieving OKRs. It also assigns responsibility for each OKR. For example, one OKR might cut across two departments – and an alignment workshop helps work out those kinks.
- OKR kickoff – An OKR kickoff is used to present all the signed-off OKRs to the entire company. This should be done early into the year to ensure individual HR practitioners have enough time to set their individual OKRs. It should have a festive atmosphere to it to inspire employees to achieve the ambitious OKRs set.
- Check-ins – Check-ins should be organized on an organization-wide and individual level. OKRs are generally set at the start of a year, and sometimes they can slip employees’ minds. Having regular check-ins provides support and continuous learning.
- Feedback and review – As the year progresses, it becomes important to review what is working and what is not working. You should ask critical questions:
- Are the OKRs working?
- Are the OKRs too ambitious?
- What are obstacles in the way?
5. Define a reasonable number of Key Results per Objective
The Key Results should be quantifiable, and it is typically recommended to have between two to five KRs per Objective. If you define more Key Results than that, you risk your team members losing focus.
6. Assign a weighted value to each KR
By giving a percentage weight to an OKR, you’re able to prioritize daily efforts and activities. It also helps you determine how much of your Objective you’ve achieved and hold various departments accountable. Here is an example of how you might weigh your OKRs. In this case, the objective is to increase employer brand awareness in the industry.
👉🏻 DOWNLOAD HR OKR examples
Fostering a culture of accountability, HR OKRs use success factors to track and visualize your team’s commitment to reaching the highest level of performance. It’s also an excellent way to promote data-driven decision-making within your team.
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