As November begins, it’s a great time to start the planning process for the next year. When you reflect on this year past, are you thinking about your successful accomplishments? Or are you frustrated that yet another busy year has passed and you’ve not achieved what you wanted to?
One thing is for certain – we need to find methods of planning that are fast, adaptable to change, and empower entire teams to solve problems with autonomy.
In the past few years, we’ve seen an increasing use of OKRs – Outcomes and Key Results – to facilitate the ongoing connection between strategic goals and day-to-day actions.
No longer is it relevant or desirable to set a top-down trajectory – the brave new world of work requires a different goal-setting approach that reflects the accelerating change in corporate culture, generational attitudes, our digital economy, and people-powered business.
Why everyone is talking about OKRs
“OKRs are emerging as a focus in product teams right now because they’re agile and responsive, individualistic as well as unifying and motivating, says Adrienne Tan, Brainmates co-founder and Principal Consultant. “We introduced OKRs into Brainmates earlier this year and have been challenged, excited, and provoked by how it’s changing our approach and culture.”
Perhaps one of the most attractive attributes of OKRs is their democratic nature. OKRs are a performance tool, not an employee evaluation tool that rewards achievement with compensation and promotions.
By separating compensation from objectives and outcomes, people aren’t discouraged from setting ambitious objectives, and the frequent check-ins and agility of the system lessen the likelihood of failure.
Your essential guide to OKRs
John Doerr, a highly successful venture capitalist and the person who introduced OKRs to Google, thus making them infinitely more interesting to the rest of us, has a simple goal-setting formula: “I will ________ as measured by ____________.”
Using Doerr’s formula, a goal needs a description and measurement which, translated into OKR-speak, is “I will (achieve an Objective) as measured by (this set of Key Results).”
The process of setting objectives is an opportunity to unify the organisation with wording that is motivational, ensuring people are emotionally invested with a sense of purpose in their work. This process doesn’t need to be rushed – it can be team-building, invaluable for developing company culture and engagement, and develop cross-team competencies and connections.
Each objective needs two-to-five key results – more than this will reduce their usefulness, as they’re too easy to forget or they dilute priorities.
Making the organisation visible
Another key component of OKRs is the visibility of all people’s individual OKRs within an organisation.
From the top down, nobody is exempt from having their OKRs visible, although many organisations roll out OKRs in teams before incorporating the wider organisation.
What makes OKRs particularly suited to Product Management?
” Product Management is the place in business where strategic goals turn into business outcomes. “OKRs are topical in the Product Management world because they dovetail with many established approaches that PMs live by,” says Adrienne.
“OKRs support business agility, with shorter goal cycles so that companies can adapt and respond, with plenty of feedback cycles.
“OKRs also differentiate between the different types of goals, from strategic, high-level, longer-term goals, tactical, shorter-term goals for teams, and operational goals for tracking results and initiatives, all of which have different check-in times.”
OKRs favour simplicity and tend to take far less time to set up than more traditional, cascade-style goal setting. OKRs are built on transparency, with everyone in the organisation having access to each other’s OKRs, typically via the Intranet.
OKRs are bidirectional: the company sets strategic OKRs and gives this to each team to draft their tactical OKRs. Teams’ tactical OKRs need to align to other teams, with about 60 per cent of OKRs set as bottom-up agreements, which improves engagement.
OKR’s intentionally set ambitious goals that should have 60-70% achievement rate at best.
In Google, ambitious goals are mentioned in their philosophy, Ten things we know to be true:
“We set ourselves goals we know we can’t reach yet because we know that by stretching to meet them we can get further than we expected.”
OKRs encourage these ambitious goals – and we believe that Product Managers are a naturally ambitious bunch – to encourage teams to extend themselves beyond their comfort zone, and to sometimes achive amazing things.
Knowing is one thing, doing is something else entirely … better
So if you’ve implemented OKRs in your workplace, how do you know if you’re doing them ‘right’? And how do you know if they’re working?
1) An objective should be closely linked to a clear business outcome. This will be measured by a key result, not the task that brought the result. Don’t confuse tasks with the outcome you achieve from doing them.
2) If you’re clear on the results, outcomes or objectives you’re looking to achieve, you need to make sure you have meaningful tasks and activities that will bring these about.
3) Meaningful tasks and activities should, ideally, become embedded in the rituals and routines of the organisation. “It’s when meaningful tasks becomes habitualised, that real momentum happens,” says Adrienne.
4) Check-ins should happen every week and should be short, sharp, and outcomes-focused. A check-in is not a staff meeting that reacts and responds to the mini emergencies that inevitably arise in business. A check-in is proactively focused on improving results. In this way, OKRs become part of company culture.
5) Alignment between teams and across the organisation is one of the innate strengths of the OKR system, so ensure that OKRs aren’t created in silos, and trust that individual teams are best placed to understand their key objectives that will help achieve the overall company strategy.
Don’t be deterred if your objectives need to be iterated – that’s part of the process! Don’t apply old-world thinking to new-world approaches. Go forth and prosper!