An Introduction to OKRs for in-house legal counsel [+ free template]
64% of in-house counsel have never heard of OKRs. So, to help you plan, execute and achieve, here's what you need to know about OKRs (as well as a free template to help you get started).
64% of in-house counsel have never heard of OKRs*.
But with an ever-increasing workload and fast-moving business environment, in-house lawyers must now explore new ways of working to prioritize more effectively.
To tackle this, some high-performing legal teams are adopting "Objectives and Key Results", or OKRs as they're more commonly known.
This nifty productivity tool can help in-house lawyers create focus, streamline workflows and create greater business impact.
To help you plan, execute and achieve, here's what you need to know about OKRs (as well as a free template to help you get started).
What are OKRs?
OKRs are a goal-setting technique that encourages teams to set ambitious goals while also articulating the more granular stepping stones needed to achieve them.
They are a strategic framework from which legal teams can improve focus, prioritize resources and work in a more agile manner. You can learn how to create a more agile legal department here.
The history of OKRs
While OKRs have risen in popularity over the last decade or so, their history can be traced back to 1954 when Peter Drucker invented Management by Objectives (or MBO).
Andrew Grove then co-founded Intel in 1968 and, during his time as CEO, he built on the MBO methodology to create the OKR framework that is used today. However, OKRs gained real traction when John Doerr, a former employee at Intel, became an early adviser to Google. He introduced the concept to Google's founders who went on to implement OKRs across the business.
How do OKRs work?
An OKR will feature one Objective and a handful of corresponding Key Results that indicate whether or not that Objective has been achieved. It's a mechanism to translate bold missions into actionable goals and milestones.
Generally, a department will have 2 or 3 OKRs per cycle (usually a quarter), each with 2 to 5 corresponding key results. They are created ahead of the cycle (i.e. before the quarter begins) and are tracked throughout to better inform actions.
OKRs have four main characteristics:
👉 A set timeframe - to provide focus over a specific period
👉 An ambitious objective - to motivate and encourage teams to strive for great things
👉 Measurable key results - to indicate progress towards the Objective
👉 Scoring - to check in, assess the current scenario and inform next actions (OKRs are scored on how confident you are about achieving the result, using a scale of 0 to 1)
Scoring can be a little confusing so we've summarized how we view the scores between 0 and 1 below.
How do OKRs differ from KPIs?
You may have heard of Key Performance Indicators (or KPIs) and while these are often confused with OKRs, they are certainly not the same. OKRs are a strategic framework whereas KPIs are measurements that exist within a strategic framework. The former is a bold action plan and the latter is a specific and comfortably attainable metric.
In addition, the intentions behind the two are very different. KPIs are standard, stand-alone metrics whereas OKRs are intended to motivate teams to be ambitious and agile; striving to achieve aspirational goals with the help of more specific and actionable measurements.
Why should in-house lawyers use OKRs?
In-house lawyers are experiencing limited resources in the face of an ever-increasing workload. This is why legal teams must focus their resources on the tasks and projects that matter the most strategically. OKRs help them to do just this.
With that being said, it's important to note that OKRs aren't for everyone. Generally, lawyers working in fast-paced industries such as tech will benefit from this tool. OKRs help to transform great ideas into effective execution, so legal departments who have to move quickly, implement new processes and technology, and work on larger projects will likely benefit from OKRs.
There are a number of key benefits for in-house lawyers using this technique.
Articulate the value of legal more easily
With few tangible metrics and work that is centered on preventative measures, it can be difficult to articulate the value of the legal department. The only way that in-house counsel can know if they're succeeding is if they're able to track the value that they create.
OKRs are a mechanism to do just this. They present the opportunity to articulate and share Legal's impact on the business in a clear and assessable manner.
The measurable nature of OKRs means that in-house lawyers can better define the value of legal work. Recording results using the OKR framework leads to stronger budget negotiations with senior leaders and the Finance team.
Raise the profile of legal
Increasingly, in-house legal counsel are shifting from playing a transactional to strategic advisory role. Particularly for lawyers operating in the tech industry, working to OKRs helps to raise the profile of legal work. By communicating Legal's impact in a language that the rest of the company can understand, the wider business will feel more engaged with legal matters.
Legal OKRs should compliment wider business goals. This means that the legal department will be focusing its efforts on the things that matter most to the business while also improving collaboration with other teams.
It's important to note that before setting OKRs, legal teams should understand the wider business goals and roadmap. Armed with this knowledge, in-house counsel can explore what they will need to do in the coming cycle to cater to future business requirements.
Working to concise OKRs means that legal teams can strategically prioritize tasks and projects that have maximum impact. Equally, it helps identify what is not important to the company and, therefore, reduces time wasted on low-value work.
Particularly for our in-house friends in fast-paced industries like SaaS, OKRs help legal teams move quickly and adapt effectively to change. With defined goal cycles, OKRs can help in-house lawyers work in a more fluid manner; achieving results more promptly and shifting to new business priorities with ease.
More impactful decision-making
OKRs help legal teams make impactful decisions by honing in on work that will have the greatest impact on business priorities, but they also help inform decisions by tracking progress throughout the cycle. Having measurable key results along with your objectives means in-house lawyers can understand how far or close they are to achieving their desired results and adapt their approach accordingly.
Better team engagement
Having big, bold objectives tends to inspire in-house lawyers and make them feel more engaged; getting them excited about their work and how it connects to the wider business. Legal OKRs are constructed using the knowledge of other business teams and, thus, it also results in better collaboration and cross-team engagement.
Common pitfalls (and how to avoid them)
So you understand what OKRs are, you like the idea, and are thinking about implementing them. Before doing so, it's important to be aware of the common pitfalls that stop teams from benefiting from the OKR methodology.
Setting key results which are not measurable
Now, this can be a tricky one for in-house lawyers. As a non-revenue generating department and with few tangible metrics to analyze, it can be daunting to define key results that are measurable. For legal departments, measurable does not necessarily mean an increase/decrease type metric, but rather a clear milestone that can be defined as complete when achieved. You may also want to consider adding deadlines to your key results. For instance, "Upload all contract templates to our new CLM platform by 31st October."
Setting too challenging or too easy OKRs
Objectives should be ambitious enough that they make you feel a little uneasy. However, if you're never achieving them, it's likely that your objectives may be overly ambitious. That said, if you're achieving all of your objectives comfortably, you should consider being a little more aspirational.
Setting too many Objectives or Key Results
Remember, OKRs are there to provide focus so don't be tempted to add your entire to-do list as OKRs. Limit the number of Objectives to 2 or 3 per quarter with only 3 to 5 key results each. In reality, you'll only be able to focus on this many priorities in one period.
OKRs become yet another thing to report on rather than a tool for productivity
OKRs exist to support you, not hinder you. Some teams allow them to grow arms and legs and, as a result, lawyers are left spending hours creating and reporting on OKRs. Be conscious to keep them concise and ensure everyone in the team understands and protects the value they can offer. Also, during your check-ins, start with the business objectives so that you don't lose sight of the bigger picture.
An 8-step plan to adopt OKRs in your legal department
1️. Get the team on board - to reap the benefits of OKRs, everyone in the legal team should be bought into the idea and involved in their creation
2️. Decide where your OKRs will live - OKRs should be stored somewhere that is easily accessible and visible (e.g. a Google Sheet - we've created this template to help you get set up)
3️. Be aware of business priorities - put a mechanism in place to ensure you are continually aware of wider business goals and priorities (this may be a regular meeting with relevant stakeholders or following business OKRs if they exist)
4️. Set your objectives - collaboratively set 2 to 3 objectives that define where Legal can have the most impact in this coming cycle
5️. Set key results - for each objective, define 2 to 5 key results that would confirm that you've achieved the objective
6️. Assign an owner to each key result - while key results belong to the whole legal department team, one person will be responsible for tracking its progress
7️. Review your OKRs by asking yourself these questions: 👉 Are they ambitious enough? 👉 Are they too ambitious? 👉 Do these cover where Legal can have the greatest impact this cycle?
8️. Try it out - the OKR process can be adapted to what works best for your team. For instance, what works for a team of five in-house lawyers might not be the same for a one-person legal team. Try it out and see what works for you.
We've created this 'OKR Template for In-House Legal Teams' to help you get started.