How to Use OKRs Effectively?

Nitish Mathew
May 29
7 min read

Updated: Sep 13

Red and white target with a yellow paper airplane striking the center. Minimalistic design on a white background.

I have had consistent success with using the Objectives and Key Results (OKRs) framework in getting things done, by keeping teams focused, engaged and aligned. I was introduced to them at a workshop on Product Thinking from the SVPG team in 2019. The principles look deceptively simple but it took years to really understand them. Some learnings and reflections that may help you:

Why OKRs?
50% of projects, irrespective of industry, function and size fail to achieve their outcomes. Claude, Google and ChatGPT cited unclear objectives as a key reason for the question "What are key reasons why projects fail to achieve outcomes?" (See Appendix). A 2025 April 25 WSJ article mentioned how companies are struggling to drive ROI on AI and it suggested that "Companies should target specific outcomes, break work into AI-enabled tasks, align them to KPIs, and scale across the organization." Notice that the first point is about outcomes.

I have found OKRs useful to frame, align on and communicate outcomes and I think they can help you derive value from your initiatives, particularly in the AI-first world.
Where do OKRs fit in the planning process?
OKRs are the connector between strategy and projects/action plans. Strategy is the specific set of high level steps that an organization takes to achieve its mission. Strategy may be too high level, or too open to interpretation. OKRs help teams' projects align to the strategy. They are useful in getting alignment across various functions as well.

For example "Reduce cloud costs" may be interpreted in different ways by various functional teams and may lead to conflicting projects. It may not be clear what to focus on, or what success looks like. "Reduce cloud costs by focusing on eliminating storage not accessed in 7 years" may be a clear Objective and "Zero $ spent in used storage by each cost center by Q3, 2025", is a Key Result, that is crystal clear to everyone. Now various teams know what to focus on, and more importantly, what not to worry about.

Tyranny of Choice is a problem not just for shoppers but engineering teams as well. AWS has over 200 services as of 2025. If leadership can make that strategy call, as in the example above, to focus on storage, it takes away pressure from teams to evaluate all their services and they may end up spending far too much time on something that actually doesn't end up moving the needle much. This requires leadership taking decisions, communicating them openly, being consistent and reiterating and tracking their progress, or lack thereof.
Take time to learn about OKRs
John Doerr's Measure What Matters book is excellent. Another option is a 2-hour course OKRs Explained. Invest time to learn the background and examples from various organizations. Take time to test them in your context with small projects first. Christina Wodtke's Eleganthack blog and books are great sources as well. Rick Clau's 2012 presentation How Google sets goals: OKRs is something I watch periodically. You can start with these two minutes from the legendary Andy Grove.

Andy Grove on OKRs
They are powerful 1:1 alignment tools
I have found OKRs most useful for having focused weekly discussions with the managers who reported to me. I would work with them to discuss the objectives they want their teams to focus on and ensure they were aligned to the strategic company goals. I had no other recurring meetings with them or their teams as we were always aligned - I didn't spend any time in standups, retros or planning sessions. As a manager of managers, my role was not to micromanage but to coach, empower, support and hold my teams accountable for outcome and OKRs helped us a lot in doing that while eliminating unnecessary meetings with many people.

We are awash with shiny objects in data and tech. It is easy to get carried away and make an objective such as "I will implement Gen AI" and "KR of 5 airflow pipelines with Gen AI" by the end of the quarter. That is not a business goal. Gen AI could be one of the solution options to achieve a business goal. They are also useful in aligning with other teams as they know clearly what you care about as a team.

If you do not discuss your OKRs every week and only revisit them at the end of the year or quarter for grading, you will not get the most value from them. Avoid getting caught up in complex OKR software, dashboards, and intricate reporting mechanisms that lead to too much administrative burden - keep things simple so the actual goal-setting and execution work take priority. At times we have used the KISS principle to move to less sophisticated, coarse measures, to eliminate admin effort with having fancier, but hard to track measures. Since KRs are numeric they helps eliminate ambiguity as well.
They shouldn't be feared and prevent people from pushing themselves
People sometimes get worried about setting ambitious goals as they are afraid if they don't meet them, then they will be punished. If so, then it is a flag that you have not communicated what OKRs actually are. Team leaders needs establish a strong environment of psychological safety before people will find it comfortable to make BHAGs (Big Hairy Audacious Goals). They should be graded on the way they approached the objective, their creativity, collaboration, grit and resourcefulness. You can also enable people to clarify whether an OKR is a firm commitment or an ambitious stretch goal to reduce frustration if aspirational goals are treated as failures for not reaching 100%. In the same vein, it is healthy to a distribution of BHAGs and firm commitments.

I have found that creating an environment where people get comfortable to make bets and know that they will be supported, and held accountable for delivery, boosts intrinsic motivation. Intrinsically motivated leaders can radically improve your company. OKRs provide an effective framework to operationalize accountability with autonomy.

Once one of the managers in my org realized that his objective need to be totally changed as his focus area was no longer relevant to the company. Though he felt sad about some wasted effort, he didn't succumb to sunk cost fallacy and proactively discussed with me to change his OKRs - that was excellent leadership and he was rewarded appropriately.
They cannot solve all your problems
You still need good judgement, culture and management. You still need to do the work to get the right objectives that align to the strategy. They are just a tool and will amplify your higher order mistakes such as a bad strategy. You also need to put effort into ensuring a robust OKR process. I have seen key results that are vague ("Improve customer satisfaction"), not measurable ("Better user experience"), or focused on activities rather than outcomes ("build 10 dashboards") fail to provide the clarity and accountability that make OKRs effective. When used effectively, I have found that OKRs help bring out many issues in the company that may go unnoticed as well.
Leadership support and engagement is important
When executives don't actively use OKRs themselves or treat them as a part of annual planning exercise never to revisit them periodically, they lose credibility. Teams sense when leadership isn't genuinely committed, leading to perfunctory participation. Not sure about now, but for years, every single person's OKR (from the CEO down) at Google was part of their intranet profile according to the snippet in the image from Rick Clau's presentation How Google sets goals: OKRs. This level of transparency at Google in the previous point is uncommon. But don't let that discourage you. There will be some scope of work that you control and you can be a good example to others with your effectiveness with OKRs.
Source: In the Plex - Steven Levy
You have to trust people for OKRs to work
Christina Wodtke summarized it perfectly - "OKRS are NOT for Command and Control. Do not use OKRs if you want to control people’s activities. Only use OKRs if you want to direct your people toward desired outcomes and trust them enough to figure out how." (Source: Cascading OKRs at Scale). She goes to explain how empowered teams are essential. Empowered teams doesn't mean that people are free up to do whatever they want- check out Empowered Product Teams to learn more.
OKRs may not be a good fit for your organization
A lot of things needs to align for your organization to use OKRs effectively. In addition to what I mentioned above, they work well in companies with a Product Operating Model. If you a CEO or a CXO interested to get your whole company to adopt OKRs, don't rush into it. Be sure you are ready to make the effort to win hearts and minds and change culture. It is not fancy OKR tools that you want, it is a totally different operating mindset and culture that is really the power of the product operating model - OKRs happen to be an implementation aspect of the model.
OKRs are powerful to bring purpose, passion and peace of mind
I have used OKRs for 5 years since 2019. An unexpected benefit we got was a sense of pride and camaraderie when the whole org had a single overarching OKR every year - "We are in it together." It also gave the whole team a lot of peace and stability as we never had to change them during the course of the year, as we always took substantial effort in thinking through before finalizing them, getting support from leadership and partner teams. Make sure to ground them on company goals as they are much more resilient to constant org structure changes that are quite common in companies. When you have numeric measures as KRs, people get excited when they see progress month over month and it helps them overcome inevitable adversities along the way in large complex initiatives.