What Are OKRs?

When I first came across OKRs as a method to align our team's goals, it completely changed the way we worked.

But I’ll be honest, it wasn’t smooth sailing.

I remember feeling overwhelmed by all the terminology and frameworks that came with setting effective OKRs. It took me a while to truly understand the importance of having clear, measurable goals that aligned with the company's vision - and how OKRs could help guide us.

But once I understood the basics, it all clicked, and our team became far more aligned and focused.

So, what exactly are OKRs?

And how can you leverage them to drive your business forward?

Let’s find out.

Definition: OKRs stands for Objectives and Key Results - a goal-setting framework used to define and track objectives within an organization. It helps teams focus on measurable outcomes, align efforts toward shared goals, and track progress in real-time.

The idea behind OKRs is simple: you set objectives (what you want to achieve) and then define key results (how you will measure success). OKRs provide clarity, focus, and alignment across teams, ensuring that everyone is on the same page and working toward shared goals.

OKRs are used at all levels of an organization - from high-level company-wide goals down to individual team or department objectives. The best part about OKRs is their ability to keep teams motivated, focused, and accountable without adding unnecessary complexity.

Now, let’s dive into the first part of the OKR framework: The Objective - what you want to achieve. This is the "big picture" goal that sets the direction for everything that follows.

The Objective: What You Want to Achieve

An objective is a clear, concise statement of what you want to achieve. It should be ambitious yet achievable and should align with your company’s overall strategy.

The objective serves as the "what" in the OKR process.

It provides direction and focus, helping your team know exactly what they are working toward.

Examples of Objectives:

Increase revenue by 30% this quarter.
Launch a new product feature by the end of the month.
Improve customer satisfaction by 20% this quarter.

Each of these objectives is specific and measurable, making it clear what success looks like.

These objectives need to be followed up with key results - the specific metrics that will measure your progress toward achieving them.

Key Results: How You Will Measure Success

Key results are the concrete, measurable outcomes that indicate whether or not you’ve achieved your objective.

Key results are the "how" you measure progress and success.

They should be quantifiable, time-bound, and clearly linked to the objective. Key results help keep teams focused on what matters most and ensure that progress is being tracked along the way.

Examples of Key Results:

Increase new customer sign-ups by 25% in the next quarter.
Reduce product load time by 30% by the end of the month.
Achieve a 90% customer satisfaction score on post-purchase surveys.

These key results provide specific, measurable targets that give the team a clear indication of success. Key results are the benchmarks that help measure how much progress has been made toward achieving the objective.

At this stage, most startups ask the same question:

How many key results should you add?

When it comes to key results, quality always outweighs quantity.

For each objective, 3-5 key results is the sweet spot.

Here’s why:

Focus: Too many key results can dilute your focus and make it harder to track progress. Keeping it to 3-5 ensures that each key result is meaningful and directly contributes to the objective.
Clarity: A smaller number of key results makes it easier to measure progress. If you have too many, it becomes challenging to evaluate success or identify what’s truly driving results.
Accountability: Fewer key results mean that your team has clear, actionable targets. This allows for better accountability and a more manageable process for achieving the objective.

Stick to 3-5 key results for each objective, and you’ll keep your focus sharp and your team aligned!

How Objectives and Key Results Work Together

The objective is the goal you want to achieve, and the key results are the ways you measure progress toward that goal. Together, they form a clear and actionable roadmap.

While the objective gives the vision and motivation, the key results provide the structure and accountability needed to get there.

For example, if your objective is to “Increase revenue by 30% this quarter,” your key results might include:

Achieve 25% growth in new customers.
Increase average deal size by 15%.
Launch a referral program and onboard 100 new users.

Each key result measures a distinct part of the objective, and when you hit these key results, you’ll know you’ve accomplished your objective.

When OKRs are effectively aligned and implemented, they have a powerful impact on startup growth. They provide teams with a clear sense of direction, fostering collaboration and motivating everyone toward common goals.

Startups that successfully use OKRs report measurable benefits across multiple areas of their operations. According to our own survey of 100 startup founders, OKRs have led to:

Improved cross-functional alignment (27.75%)
Made performance reviews easier (27.75%)
Helped us hit revenue milestones faster (18.85%)
Increased team engagement (24.61%)

These results highlight how OKRs drive tangible improvements that accelerate growth, increase engagement, and streamline processes within startups.

Now, let’s take a look at some OKR examples to see how they work in practice and understand how to set them up effectively for your team.

OKR Examples: Understanding How They Work in Practice

Let’s take a closer look at a real OKR example to see how the framework operates in practice. Understanding this will give you the clarity needed to apply OKRs effectively within your own organization.

Example of an Effective OKR

Objective: Increase customer acquisition by 25% this quarter.

Key Results:

Achieve a 20% increase in new user sign-ups on the website.
Launch a referral program and gain 150 new customers through it.
Increase website conversion rate by 15% through improved landing page design.

Why This OKR Works:

This OKR works because it clearly articulates what the organization wants to achieve (the objective: increasing customer acquisition), and it breaks that down into specific, measurable outcomes (the key results).Here’s how this benefits the organization:

Clear Direction: The objective is clear and aligned with a key growth goal - customer acquisition. It provides focus for the team, ensuring that everyone knows that their primary goal this quarter is to bring in more customers.
Measurable Key Results: The key results are specific and quantifiable - metrics like new user sign-ups, referral program success, and conversion rate improvements allow the team to track progress and understand whether they’re hitting their targets.
Actionable: The key results provide actionable steps - such as launching a referral program and optimizing the website’s landing pages - that give the team clear tasks to focus on. These are practical steps that drive toward achieving the objective.
Impact on the Organization: By setting this OKR, the team aligns around one of the most important drivers of startup success - acquiring new customers. It’s measurable, actionable, and impactful, providing a clear path to organizational growth.

Good OKR Examples for Early-Stage Startups

For early-stage startups, OKRs need to be focused on high-impact areas that will help drive growth, customer satisfaction, and internal efficiency.

Here are a few good examples of OKRs tailored to the needs of a growing startup:

Objective: Launch a new product feature that meets customer demand.

Key Results:

Complete product design and testing by the end of the month.
Gather feedback from 50 beta users and iterate based on their responses.
Achieve a 20% adoption rate of the new feature within the first month of launch.

Objective: Build a scalable marketing strategy for growth.

Key Results:

Increase organic traffic by 30% by optimizing SEO on the website.
Gain 1,000 new email subscribers through targeted content campaigns.
Launch 3 paid advertising campaigns and achieve a return on ad spend (ROAS) of 3:1.

Objective: Improve customer retention by enhancing user experience.

Key Results:

Reduce customer churn by 10% through improved onboarding and support.
Achieve a Net Promoter Score (NPS) of 60 or higher from current users.
Implement a customer feedback loop and resolve 90% of issues within 48 hours.

These examples work because they are specific, measurable, achievable, and directly tied to the company’s growth priorities. They focus on outcomes that are high-priority for early-stage startups, such as product development, marketing, and customer retention.

Bad OKR Examples for Early-Stage Startups

On the other hand, poorly written OKRs can cause confusion, misalignment, and lack of focus. Below is an example of bad OKRs for early-stage startups:

Objective: Improve sales.

Key Results:

Increase the sales team's performance.
Improve product features.
Have more customer calls.

Why is this a bad OKR? It lacks clarity and specific, measurable targets.

The key results are vague and don’t provide any quantifiable outcomes. “Increase the sales team's performance” is not a specific, measurable key result - it doesn’t say how much performance is expected to increase, and it lacks any deadlines.

Similarly, “Have more customer calls” doesn’t explain the desired outcome or impact. Effective OKRs should have specific numbers tied to them to track progress.

With that in mind, understanding the key terms related to OKRs is essential for setting up a clear and effective goal-setting framework. Let’s dive into some important OKR terminology to help you get started.

OKRs Glossary: Key Terms Related to OKRs

When you’re first diving into the world of OKRs, it’s easy to get lost in the jargon.

There are many terms and concepts that are integral to understanding how OKRs work, and it can feel overwhelming if you’re not familiar with the terminology. That’s why we’ve created this glossary - to give you clear, simple definitions for OKR-related terms.

Understanding these terms will help you understand the OKR process more confidently and ensure that you’re using the framework to its fullest potential.

Whether you’re getting started or refining your existing OKRs, having a solid grasp of the vocabulary - and context - is key to implementing them effectively.

Alignment – Alignment refers to the process of ensuring that your company’s goals and strategies are in sync with the OKRs you set at every level of the organization. It helps ensure that all teams and individuals are working toward the same objectives, reducing confusion and increasing collaboration.
Accountability – Accountability is the responsibility assigned to individuals or teams to achieve the OKRs they've committed to. It involves tracking progress, setting expectations, and holding people responsible for their outcomes, fostering a results-driven culture within the organization.
Ambitious – When an objective is described as ambitious, it means it’s challenging and intended to push teams beyond their comfort zones. While an ambitious objective should be achievable with effort and focus, it should be designed to inspire innovation and creativity.
Key Results – Key results are the measurable outcomes that show how you will achieve your objective. They act as milestones, breaking down the larger goal into specific, quantifiable actions that help you track success and determine progress toward the objective.
Objectives – Objectives are broad, qualitative statements that define what you want to achieve. They provide direction and motivation by setting the course for what your team or organization needs to accomplish within a defined timeframe.
Measurable – A key result is considered measurable when it can be tracked and quantified over time. Being measurable is crucial for assessing progress and determining when a goal has been reached, providing clarity on how success is defined and achieved.
Time-bound – A time-bound key result means that it has a specific deadline attached to it. This timeframe creates urgency and helps teams stay focused on achieving the goal within a set period, preventing delays and ensuring timely progress.
OKR Cycle – The OKR cycle refers to the period in which you set, track, and review your OKRs. Typically, OKRs are set on a quarterly or annual basis, with periodic reviews to measure progress, make adjustments, and evaluate success.
Stretch Goal – A stretch goal is an objective that is intentionally set to be challenging and aspirational, often requiring teams to go above and beyond to achieve it. While these goals are tough to attain, they drive innovation and push teams to excel in their performance.
Transparency – Transparency in OKRs means that all goals, objectives, and key results are visible to everyone in the organization. This openness fosters trust and accountability by ensuring that progress is shared, making it easier to align efforts across teams.
Progress Tracking – Progress tracking is the ongoing process of measuring and monitoring the completion of key results. This helps teams stay on track and make adjustments when necessary, ensuring that they remain aligned with their objectives.
Goal-Setting Framework – A goal-setting framework is a structured approach used to set, track, and measure progress toward objectives. OKRs are one such framework that enables organizations to break down larger goals into manageable, measurable parts.
Key Performance Indicators (KPIs) – KPIs are metrics that are used to evaluate the performance of a business or team against its goals. While OKRs focus on key results, KPIs are often used in tandem to track performance in various areas of the organization.
Quarterly OKRs – Quarterly OKRs are objectives and key results that are set to be completed within a three-month timeframe. This allows teams to work toward short-term goals while maintaining a sense of urgency and focus on quick wins that can drive long-term success.
Annual OKRs – Annual OKRs are long-term goals that typically guide the direction of a company or department for the entire year. They help set the strategic vision for the company and ensure that everyone is working toward common, overarching objectives.
Cadence – Cadence refers to the regular, recurring intervals at which OKRs are reviewed and updated. A typical OKR cadence is quarterly, but some organizations may use different cadences depending on their goals and timelines.
OKR Owner – An OKR owner is a person who is responsible for driving the achievement of a specific OKR. They are accountable for tracking progress, ensuring that key results are met, and reporting on the status of their OKRs to other stakeholders.
Cascading OKRs – Cascading OKRs is the process of breaking down company-wide OKRs into smaller, more specific objectives for teams and individuals. This ensures alignment at every level of the organization and makes sure everyone is working toward the same overarching goals.
Cross-Functional OKRs – Cross-functional OKRs involve multiple departments or teams working together to achieve a shared objective. These OKRs require collaboration across different functions (e.g., sales, marketing, and product) to ensure that all areas contribute to the same goal.
OKR Software – OKR software is a digital tool used to help organizations set, track, and manage their OKRs. It provides a centralized platform for teams to align their goals, track progress, and report on key results in real time, making the process more efficient and transparent.
Review Cycle – A review cycle is the process of regularly evaluating progress on OKRs and making adjustments if necessary. This often occurs during quarterly or annual OKR reviews, where teams assess the status of their objectives and key results and decide what actions need to be taken to stay on track.
Check-In – A check-in is a regular meeting or process where teams review their progress toward OKRs. It helps ensure that everyone stays aligned, and adjustments can be made if necessary. Frequent check-ins keep goals top of mind and provide accountability for achieving key results.
Adjustment – An adjustment is a change made to OKRs mid-cycle based on new information or shifts in priorities. If key results are too ambitious or circumstances change, adjustments ensure that objectives remain realistic and achievable without losing focus on the desired outcomes.
Outcome – Outcomes refer to the actual impact or results achieved from completing OKRs. Unlike outputs, which focus on tasks or activities, outcomes measure the effectiveness of actions taken and how they contribute to the overall goal of the organization.
Scoring – Scoring is the method used to evaluate how well key results have been achieved. Typically, key results are scored on a scale from 0 to 1, with 1 meaning fully achieved and 0 meaning not achieved. Scoring helps teams assess their progress and identify areas for improvement.
Top-Down/Bottom-Up – Top-down is when leadership sets company-wide OKRs that cascade down to teams. Bottom-up allows teams to propose their own OKRs that align with the overall company goals. Both approaches ensure alignment and engagement throughout the organization.

Before you implement OKRs, you may have some common questions.

I’ll answer three of the most frequently asked questions to help clarify any doubts you might have.

3 OKR Questions Startups Ask

1. How can you adjust or revise OKRs if progress is falling behind mid-cycle?

If progress is lagging, it's important to review the key results, assess challenges, and pivot if necessary. Adjust deadlines or key results to reflect realistic goals while maintaining alignment with overall objectives, ensuring the team stays motivated and focused.

2. What are the common mistakes startups make when setting OKRs?

Mistakes include setting vague or unmeasurable key results, overloading with too many objectives, or failing to align across teams. To avoid this, ensure objectives are clear, specific, and ambitious but achievable, and limit the number of key results to maintain focus and accountability.

3. How do OKRs fit into performance reviews and employee development?

OKRs can be integrated into performance reviews by evaluating employees' progress on key results. It fosters accountability, identifies areas for improvement, and aligns personal growth with company goals. Regular reviews ensure ongoing feedback and support, enhancing development while driving organizational success.

To make this process even easier, you can simplify your goal-setting and tracking with OKRs Tool, which provides a streamlined platform for setting and managing OKRs efficiently.

Simplify Your Goal-Setting Process with OKRs Tool

Now that you've got a solid understanding of OKRs, it's time to put that knowledge into action. Getting started with OKRs Tool can help you easily set and track your objectives without the usual complexity. Here's why OKRs Tool is the perfect fit for startups like yours:

Fast Setup, Real Results: Forget weeks of onboarding. With OKRs Tool, you can create your first objective, assign key results, and launch initiatives in under 2 minutes with AI. No consultants, no complex setups - just simple, actionable goals from day one.
Built for Startups, Priced for Growth: OKRs Tool uses team-based pricing with no per-user fees, so your early-stage startup can stay focused on alignment and execution - without worrying about rising costs as you scale from 2 to 20+ people.
Action-Linked OKRs, Not Just Tracking: Unlike other platforms, OKRs Tool connects every Key Result directly to real initiatives. Teams don't just see progress - they drive it, with real-time updates, async check-ins, and an intuitive dashboard that keeps the whole company moving forward.

Start using OKRs Tool today and streamline your goal-setting process, making it easier for your team to stay focused, aligned, and accountable as you work toward your next big milestone!

What Are OKRs? (Objectives and Key Results)

What Are OKRs?