OKR vs NCT: Which is Better for Your Team?

Setting goals for your team, company, or project is not an easy undertaking. It requires various skills as well as a good understanding of strategy, the right environment, and even motivation. As such, there is no surprise, different techniques are being used to help achieve better results. The two most discussed today are – OKR and NCT.

Each of these approaches offers certain benefits to its users. So, let’s take a look at how they differ and which one may be right for you in the comparison of OKR vs NCT.

What is the OKR technique?

The concept of OKRs was first introduced by Andy Grove in 1970. The approach was aimed to help teams set goals that are significant, concrete, clearly defined, as well as inspirational.

The technique behind this approach is quite simple and is all coded into the name OKR. The acronym stands for Objective-Key Results. Where Objectives define the large goals or undertakings you want to achieve and Key Results define the initiatives and actions that help you get there.

Typically for each Objective, the team defines 3-5 Key Results. The team then breaks down the key results into actionable tasks and aims to complete them during the set timeframe. If the team achieves the Key Results, the Objective is counted as achieved as well. To give you a better idea of what this looks like, here is an example:

Objective – Successfully launch version 2.0 of our product.
Key Result 1 Get 10k new customers.
Key Result 2 Have the product reviewed in 30 publications.
Key Result 3 Increase the trial-to-sign-up ratio up to 20%.
Key Result 4 Launch beta version 2.0.

The biggest criticism when it comes to the OKR approach is the lack of strategy. Unless your team puts a special emphasis on it, there is very little discussion of ‘Why’ included in setting and delivering the goals. This is what the NCT approach aims to fix.

What is the NCT technique?

The NCT technique was proposed by Ravi Mehta as an alternative to OKRs. It is also an acronym that stands for Narrative, Commitments, Tasks. The aim of this approach is to provide a goal-setting system that is more motivating and predictable compared to the OKR technique.

To better understand how this technique works, let’s look at the 3 parts it is composed of:

The Narrative is a short description of what the team wants to achieve. It should summarise why this is a priority, how it fits into the larger goals, and any issues the team faced previously with similar initiatives. This is where we see the biggest difference in comparing OKR vs NCT. The Narrative gives both the goal and the reason behind it.
The Commitments are usually 3-5 objectively verifiable goals the team aims to achieve. By completing the commitments, the team is making progress for the Narrative.
The Tasks are just what they are called – tasks. The team aims to list tasks that could help achieve the Commitments. However, this list is never finalized and can be expanded as the team works towards the Commitments. Tasks should be viewed as suggestions and only be completed if they help achieve the larger objective.

To give you a better idea of what this looks like in real life, here is the same example as before put in the context of the NCT technique.

Objective – Successfully launch version 2.0 of our product.	Narrative – Product version 1.0 was launched 2 years ago and we have made various improvements since. However, with the current AI technology capabilities, we see an opportunity to move forward and introduce version 2.0. This will allow us to capture a larger user base and improve the performance for current customers.
Key Result 1 Get 10k new customers.	Commitment 1 Increase the customer database from 50k to 60k.
Key Result 2 Have the product reviewed in 30 publications.	Commitment 2 Collect 30 reviews of the new version in tech publications.
Key Result 3 Increase the trial-to-sign-up ratio up to 20%.	Commitment 3 Increase the trial-to-sign-up ratio from 15% to 20%.
Key Result 4 Launch beta version 2.0.	Commitment 4 Launch beta of version 2.0 by the end of Q1.
	Task 1 Test out the new version internally.
	Task 2 Reach out to tech publications.
	Task 3 Improve sign-up forms.
	Task 4 Advertisement campaigns for the new version.

OKR vs NCT what is the difference?

Looking at the two techniques side by side, you can certainly see similarities in their structure. The difference between OKR vs NCT lies in the depth of view. OKR goals appear to be much more shallow, whereas NCT aims to give more context to why they were defined. This is done to provide the team with more motivation, as well as to encourage a more realistic goal-setting mindset. Which can be easily lost in a very laser-focused environment.

NCT OKR Comparison

	OKR	NCT
Goals	Called Objectives. Concise and clear, disconnected from other initiatives.	Called Narratives. Provide context on why the goal is important, what it will do for the company/team, and what issues may arise when trying to achieve it.
Tracking	Done through Key Results that are defined for each Objective. Should be clear and easily measurable.	Done through Commitments that are defined for each Narrative. Should be clear and easily measurable.
Execution	Not specified, up to the team.	The team aims to list out Tasks that will help in achieving the Commitments.
Commitment	Achieving 50-70% of the Key Results counts as completing the Objective.	100% of the Commitments must be achieved to complete the Narrative.
Context	No explicit connection with company goals and strategy. Soft policy.	Company goals and strategy are included in the Narrative. Hard policy.
Maturity level	Requires some knowledge of the process.	Requires good knowledge of the process to set achievable goals.

OKR vs NCT tracking

No matter which of the two approaches you prefer, each of them will have to be tracked throughout the set period of time. To do so, you can use project management tools, excel sheets, or Kanban boards. Here is how you can set up the Kanban view in Teamhood to track OKRs.

In the example above, each row represents a different Objective and Key Results are visualized as tasks. This way, you can track which of the Key Results are being worked on and what has been completed already.

Similarly, here is a Kanban board optimized for tracking the NCTs. Here, the whole board is used to track 1 Narrative. Commitments are visualized with the help of rows and Tasks as visualized and tracked with task cards. Here, the Kanban board aids in tracking more of the daily activity and smaller tasks that are being done for the overall Narrative.

OKR vs NCT Which to Choose?

There is no definitive answer to which approach is better in the comparison of OKR vs NCT. However, those that have been using OKRs for a while say that this approach is missing some depth and connectivity to the company strategy and goals. When applying it strictly by the book, the teams can become a bit detached and start a goal-setting cycle that is not productive. This is usually defined by setting goals that are not achievable, not delivering them at the end of the cycle, and then repeating this again and again.

NCT was proposed as an alternative to OKRs and in fact, does provide the teams with much more context. However, it is not a cure-all for your process that will rid you of any problems. And it is up to you to decide which of these techniques helps you set better-measured and realistic goals for the team. Thus, no matter which of the two you pick, remember their strong points and be wary of the possible shortcomings to ensure success.