I am not an expert by any means, take this post for what it is; observations and experiences from an OKR enthusiast. I will cut straight to the chase, below is the summary why I think every manager and leader needs to look at ORKs as a tool to help achieve their objectives. A word of warning though, OKRs are just a tool. There is no magic bullet for aligning a group of people to achieve a certain outcome. Never has, never will. But a tool like OKRs can help bring more clarity and impact.
Start with the end in mind
The beauty of OKRs is that it starts with the end. What do the Managed Scorecard, KPI’s, and many ‘classic’ management frameworks have in common? They all assume the objective is clear and then try to create a management structure for it. OKRs start at the beginning, with the actual objective. Kennedy’s original statement to bring a man to the moon within the decade and bring them back safely is used often as an example because it is so easy to understand.
When things are easy to understand, the objective can travel on its own throughout the organization. Any person that was working on the US moon project could look at that objective and put their contribution in perspective. This is what you want.
Mission vs Objective
The objective is also something that you can achieve. Compare this to a mission statement which is more a description of an ongoing effort, not necessarily with an end in mind. I work for Microsoft, and our mission is ‘to enable every individual and organization on the planet to achieve more’. This is never done, which is what makes it a good mission. An objective powering the OKR framework is different. It has to be achievable. The description of an objective is the end result you strive to achieve. After which it is time to set a new objective.
Make the Objective clear for everyone
What that objective is, is up to you and your team. But anyone should be able to read it and know when it has been achieved. My experience is that if you describe your objective in as plain language as possible, you have a higher chance of achieving it. Why? Because easy to understand objectives can travel well beyond you and your team. Note that I use the word easy for the description, and not the effort. Objectives can be incredibly difficult to achieve, but easy to describe.
For example, a local cinema might formulate an objective to ‘Increase revenue from the theatre from idle times when we are not showing films’. This is a description of an objective where we can tell whether we achieved it or not. Revenue from idle times has gone up or not. How much is a matter of setting the right Key Result. But every employee of the cinema can understand this objective. But writing it in plain language also means that every employee can think about how to achieve it.
Innovation has a higher chance when you let every employee contribute. Good ideas often come from the edge, or the fringes. This is why it is so vital that everyone can understand an objective. If that same cinema example was written like ‘Increase relative revenue contribution from non-core activities’, it would not have the same impact. Keep it plain and easy to understand.
Don’t forget the WHY
As good as a description of an objective might be, if you don’t connect it to a strong why, you will not get the most out of it. An objective needs to be tied to a situation, a response that can be proactive or reactive. In the cinema example, it might be that rising maintenance costs are threatening the profitability. The team knows that it can’t raise prices because there is stiff competition and the cinema business is fixed capacity business with peak hours which makes it harder to air more films. So the team is looking for other ways to generate revenue to offset the higher costs. This is your why.
I believe this is a bit of an omission on the standard OKR framework. I recommend adding the W(hy) to OKRs when you are shaping them. This makes (W)OKRs a three way structure.
Why – What influences the definition of the objective? Why are we doing this? Set the context for the team.
Objective – The thing we are trying to achieve as a response to the why. Make it easy to understand,.
Key Results – The measurable outcomes we believe tell us whether we hit our objective or not.
This is a good bridge to talk about defining Key Results.
Key Results need to feel incredibly obvious
You know your objective definition is good when the Key Results you defined feel so obvious that it feels odd. It can’t be that simple, can it? Well, it can. Back to our cinema and the objective to ‘Increase revenue from the theatre from idle times when we are not showing films’. Our first Key Result is staring right at us. We need to increase revenue when we are not showing films.
We have to measure that because in this example, this is the only real measurable factor that matters to our objective. But we still need to say when we are happy, just how much revenue do we want to bring in from times when we don’t show films?
When are you happy?
I deliberately use the word happy, but you can also use satisfied here. The point is that plain language works here as well. There is no formula for how much revenue would indicate we have achieved our objective. So talk about it with the team. And focus on trying to gauge whether a number would make the team happy, or satisfied in relation to the objective. By now, the team is starting to get a feeling for the effort involved to make this happen.
This will also allow them to set the KR level accordingly. Should it be 10% revenue compared to the baseline revenue from showing films? Or 25%? Work it through with the team and throw some modelling at it. You decide.
Look for linkage in the work and optimize accordingly
With clear objectives and key results to achieve, the team can find more autonomy in prioritizing the work that actually impacts key results. The workload of teams is under constant pressure from tasks and other things to do, but not all of them will be aligned to the OKRs defined. This makes it easier for teams to say no to work that is not linked to the OKRs. Teams will be able to improve how they manage their time and shape the body of work that is needed to drive OKRs.
Implementing OKRs means helping teams through change – don’t skip this
You know how this works. Nothing gets implemented successfully without deliberate effort and patient guidance, nudging, motivating, and the like. OKRs are not different. You can expect you usual reception when introducing OKRs. Some people will embrace it immediately, others will wait, while some will reject it without even looking at it. Because it means they need to change. Brush up on your favorite change methodology and apply it because you will need it. My favorite collection of effective change management practices remains the book ‘Switch; How to Change Things when Change is Hard’ by the Heath brothers.
Team objectives, not individuals
A note on what level to apply OKRs. I think they work best when using them for teams, virtual or hierarchical. I mentioned before that having clear objectives and collectively articulated results increases collaboration. You lose that when you attempt to stack individual objectives in top of each other.
Iterate, iterate, iterate…. with precision!
And finally, OKRs are very welcoming to iterative cycles. You can set objectives and goals for timelines that you decide with the team. You can adapt and change as needed. You can tweak the objective definition, the key results, and the workload of the team.
The important part is that you do this with the team. Create fast iterative feedback cycles about work done, the contribution to key results, and achieving the objectives set. Encourage a dialogue on improvement that goes beyond ‘this doesn’t work’, or ‘we are not moving fast enough’. Be curious and help the team articulate possible improvements with precision.
In this example, ask ‘how fast do we need to go?’. If the answer is 5x faster or 2x faster, it makes a big difference in terms of corrective actions to be taken.
This is not an exhaustive list by far but consider this article a reflection from an OKR enthusiast, giving back some learnings after picking up so much useful guidance from other people who are sharing their work with OKRs.