OKRs are a great method to keep people aligned toward an objective. But even being a good communication tool, it lacks clarity.

Rapha Cohen, CPO of Google Waze, brought the powerful idea of making the objective communication even more clear, adding the Hypothesis and Signal components to OKR.

H for Hypothesis

Behind every Objective, we have a Hypothesis that it can be achieved.

When we don't communicate that Hypothesis, it can be invalidated during the cycle, but as no one knows about it, they will keep working in the direction of failure.

S for Signals

Key Results are great to make clear what we need to reach. But usually, they're lagging metrics. We only know it after it passed.

A signal is a leading metric that indicates if we are in the right direction to reach the Key Results.

Example

• Objective: Double New Subscription Revenue
• Hypothesis: We believe that by applying Conversion Rate Optimization technics we can double the New Subscription Revenue
• Key Results:
•  - New Subscription Revenue >= $100.000
• Signals:
•  - Sign Up Conversion Rate is increasing
•  - Trial Started Conversion Rate is increasing
•  - Subscription Paid Conversion Rate is increasing

Note that the Signals are qualitative indicators, pointing in the direction we're going. Weekly we check them so we can act to correct our direction toward the Objective.

That's how I connect the HOSK with the PDCA Cycle (Plan, Do, Check, Act), but this is a team for another article.

Work smart. Keep growing 🚀