It’s that time of the year again when white-collar workers ready themselves and their pockets for the appraisal season. It’s also when they come under intense scrutiny—every client win, every buck saved, and each target achieved is assessed to determine their salary hikes and performance incentives.
It also happens to be a tough period for startups, when they face a worsening funding crunch, with their profitability under the scanner and layoffs becoming widespread. Employers as well as their workforce are under duress. And it’s important for startups to get the performance review right.
There are multiple methods that have gained popularity in the Indian startup ecosystem, including the bell curve bell curve What is bell curve Bell curve is performance appraisal system that identifies star performers and links their performance with appropriate reward. and balanced scorecard balanced scorecard What is balanced scorcard A balance scorecard measures the intellectual capital of a company, such as training, skills, knowledge, etc. . But there’s one that stands out: the objectives and key results (OKR) framework.
The OKR framework has grown to become one of the hottest tools in the software-as-a-service (SaaS) industry, with its market pegged at $1.5 billion. Developed in the 1970s by Intel’s Andrew Grove and popularised by Google, OKR has gained momentum over the last fifteen years, counting among its fans the likes of tech giant Meta (formerly Facebook), streaming platform Netflix, professional-networking site LinkedIn, and microblogging platform Twitter.
In India, too, many companies have gravitated towards it. For instance, mobile adtech company InMobi, fintech Razorpay, credit-card repayment app CRED, home solutions brand Wakefit, real-estate platform PropTiger, online cosmetics brand Purplle, edtech major PhysicsWallah, SaaS company Freshworks, eyewear retailer Lenskart, and healthtech startup MediBuddy have all used OKR.
“There are over 150 tools that are helping organisations adopt the OKR methodology,” says Sienam Ahuja, founder of Bengaluru-based consultancy OKR Edge.
OKR is a collaborative goal-setting protocol for companies, teams, and individuals. Objectives are meant to be concrete, action-oriented, and inspirational, while the key results are a measure of reaching the set objectives. It is meant to act as a north star and bring clarity to employees in understanding the purpose of their work.
For startups that are scaling fast, it’s easy to lose focus with multiple initiatives, and OKR is meant to bring focus and alignment.