Objectives and Key Results (OKRs) is an increasingly widespread goal management framework. Initially invented by Andy Grove, and popularized by John Doerr, OKRs quickly spread among the tech companies - LinkedIn, Airbnb, Spotify. But not only tech. Such organizations Dun and Bradstreet, OpenX, Adept Media, and counting also use OKRs.
The popularity of the search term "OKR" has quadrupled over the past few years (according to Google Trends). It brings more content, more organizations implementing OKRs, and (hopefully) sharing their experience.
However, the raise of the topic of OKRs also brings the hype, fake news, unverified advice, or untested tips. That's why read any topic on OKRs with a grain of salt. And see yourself if that advice applies to your team or not.
We at Plai and Uptech have been working with OKRs for more than 3 years, talked with many organizations, and know the topic rather good. We share our experience on our blog.
Here I collected a list of top tips that would help you get started with OKRs.
Objectives and Key Results would help your team move forward fast, but they need to know where are they going. Set the vision and mission for the team to help them understand and visualize where the organization is moving. So that they can align all their OKRs in the same direction. And so that they can answer the question: Why should we set these OKRs and try to achieve them? Why should we care and contribute?
It's an important part to keep your team motivated and engaged with achieving great results.
There's a great approach to measure the impact of your goals. Each of your Key Results should be able to pass the "So what?" test:
Focusing on value helps people focus on the right metric and what's most important for the organization. And good metrics also change the way you behave.
If everything is a priority, then nothing is. OKRs are not about everything you need to do. They are about the most important goals for your team during the period. A good rule of thumb is to have up to 3 Objectives per team, with up to 3-4 Key Results for each of them.
Start with 1-2 organizational Objectives. This will guide your team's efforts and initiatives in the common direction. And it will be an excellent example for other groups to follow and implement the approach.
OKRs do not work in any team and are not for everyone. They can thrive only in the right environment. Since they require transparency, collaboration, personal accountability, and responsibility, you need to have these traits be present in your team. Otherwise, the OKR methodology won't get implemented. Another essential ingredients are psychological safety and sharing regular constructive feedback. Without them, it would be hard or almost impossible to iterate and improve your Objectives. It is importance cos no one gets them right from the very beginning. More on that below.
Everyone fails with OKR the first time. I don't know yet any organization that got them right from the very beginning and implemented effectively from day one. Understanding the process, figuring out what matters, setting the right Objectives, and relevant, measurable Key Results focused on delivering value is hard. Have the patience to try the OKR approach for at least 2-3 cycles before making the final decision whether to keep with them or not. The real value from adopting OKRs can take as much as a full year to become evident for the whole team.
Set these expectations correctly from the very beginning when you introduce the methodology. Don't expect miracles to happen from day one.
A good analog for OKRs is vegetables. Vegetables may not taste good at first, but you still have to eat them because they are right for you. And their effect is visible years into the future. Eventually, you will probably even enjoy them.
Combining OKRs and performance reviews leads to the problems of understated targets, overstated accomplishment, and low collaboration.
One friend of mine developed her rule for success after working in the corporation. "In the beginning, I was setting bold Objectives and, naturally, missed some of them. And didn't get the bonus. Now I set as unambitious goals as possible, finish them in a few hours, and spend the rest of the day for myself. The most important is that everyone seems to be happy, and I get my bonus every time" — she shares.
This is a kind of behavior that happens when you combine OKRs and performance evaluation. To avoid this, you should separate the two processes and avoid formulas. However, you'd still want to use OKRs as one of the inputs for performance evaluation (but not the only one and not the most important one). Also, accept that all performance reviews are subjective.
It's a common belief that OKRs should cascade from the organizational Objectives down to the individual ones. However, in practice, it rarely works well. In reality, such a process becomes time-consuming and slows the team. Without adding any extra value. Individual Objectives can quickly turn into micro-management and misuse. Also, individual OKRs encourage individualism instead of collaboration. Companies such as Spotify publicly announce why they ditch individual OKRs. Most likely, you'd like to avoid individual OKRs as well.
Set up regular OKRs review meetings and communicate OKRs regularly. Weekly or bi-weekly meetings are just fine to sync about OKRs and resolve blockers. They should be quick and effective (like scrum stand-ups). A good check-in is about accountability, constructive feedback and group intelligence, clear communication, and sharing meaningful progress. Not all team members should be required to participate in such meetings (but recommended).
Also, it's a good practice to assign the OKR master (or ambassador). The OKRs master would be responsible for making sure the OKRs are implemented correctly. Think about him/her as a Scrum Master for agile teams.
Teams that don't have the top-management buy-in often fail with OKRs. The strategic OKRs and overall company direction are set by the top management. Top management should lead with an example by setting and achieving OKRs and treating them seriously. If they don't give it enough focus and priority, the OKRs would be forgotten soon.
Depending on your team maturity and where do you stand as an organization, you might need to use moonshot or roofshot Objectives.
Moonshots are stretch goals that are beyond what the team thinks is possible. They are great if completed by 60-70%. It's best to use them for R&D new projects or independent goals.
Roofshot goals are the targets that the team aims to hit 100%. They are suitable for interdependent or critical initiatives (such as product release, revenue targets, etc.)
It's recommended for the new teams to start with roofshot Objectives, and adopt moonshots with practice (so that missing moonshots from the very beginning does not demotivate the team). In any case, you'd need to understand the difference between moonshot and roofshot Objectives.
Objectives and Key Results is a robust methodology that proved to be valuable over the last few decades. Use the tips above to successfully implement OKRs and align your team to achieve breakthrough results. OKRs can transform your whole organization, engage the team, and create long-term benefits for the business. Remember that adopting OKRs is a marathon, not a sprint. Start slowly and accumulate the momentum!
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