We were talking to Afnan, an OKR client whom we began helping a few years ago, and found that her company was enjoying some phenomenal employee scores – high employee retention rates, internal promotion rates, and net recommender scores, resulting in higher customer satisfaction rates and profitability.
Afnan mentioned that they had realized that their OKRs had become their System of Employee Engagement (SEE). I asked what she meant – she said OKRs were the way that people connected with the organization – its mission, their contribution, and their purpose, the progress they are making, whom they work with across the functions, what those people are doing, etc.
Everything they did with OKRs allowed them to engage more and more with the organization, its people, and its success. As they aligned activities - set their Objectives, their targets – they felt ownership of the organization. As they linked and coordinated their work to their cross-functional co-workers, they saw order-of-magnitude performance improvements.
OKRs were how everyone engaged with the organization – hence her expression “OKRs are our System of Employee Engagement”.
Afnan pointed out that they had plenty of “systems of record” - the applications that run their business (financials, ERP, CRM, etc.). They aid in decision-making, capture the day-to-day transactions, and are the repository for the information they need to make prudent fact-based decisions.
In the Human Resources arena, a system of record is known as HRIS – names like SuccessFactors, SABA, and BambooHR occupy the system of record (but not engagement) space.
After years of trying to engage employees through better performance reviews, rewards, and promotions, she found employee engagement scores remained the same. A “System of record” is not a “system of engagement”.
Afnan came to the conclusion that the transactional systems of records – ERP, CRM, etc. were one “bookend” and CHIS was the other “bookend”. What her organization needed was the stuff that worked in between the two bookends that served the people, not the transaction world. No matter how much they invested in systems of record, they would not help employee engagement.
Why is this all so important? Because organizations are moving away from a top-down, leader-centric view of managing companies toward one of agile management and agile business. This requires everyone to be connected – engaged – with the organization.
Afnan’s team found that OKRs were that connective system.
As the system of engagement, OKRs:
We used Afnan’s observations as the foundation for our latest research. Using her experience – and our observations from dozens of similar OKR stories, we have developed a process to reliably produce Systems of Engagement in various size businesses, in multiple sectors, and around the world.