Will OKRs rule the world? This article captures my thoughts on OKRs and their impact on the corporate industry.

 

What are OKRs?

OKR stands for Objectives and Key Results. It is a simple management methodology and an agile goal-setting system that enables everyone to align with enterprise objectives and to visualize the progress made towards them.

 

Founded by Intel CEO, Andy Grove, in the 1970s, the OKRs methodology was first adopted by Google in 1999. Since then, OKRs have helped Google and several other enterprises to stay focused, create transparency, gain alignment, and achieve better results. Today, several organizations across all sectors such as Spotify, LinkedIn, Walmart, Bill and Melinda Gates Foundation, and others are using this framework to set and achieve audacious goals.

 

In 1999, John Doerr, a venture capitalist, introduced OKRs to Google. In his meeting with Larry Page and Sergey Brin, co-founders of Google, he introduced the OKR system and explained how it can help Google to achieve its aggressive growth targets. In his book, Measure What Matters, John revealed how the system of OKRs has helped organizations achieve agility and explosive growth.

 

John Doerr’s formula for OKRs is:

I will (Objective) as measured by (set of Key Results).

 

Objectives define 'what' is to be achieved. They are qualitative, significant, concrete, short, inspirational, memorable, and ambitious. Each objective could have 2-5 key results.

 

Key Results define 'how' we achieve the objectives. They are a set of measurable milestones for each objective to track progress towards achieving the objective. They are quantitative, specific, measurable, time-bound, verifiable, and aggressive, but realistic. When key results are complete, the objective is necessarily achieved.

 

Will OKRs Rule the World?

Let’s look at some of the common problems faced these days and if OKRs can prove to be beneficial in those scenarios.

 

One of the common problems today is conflicting priorities. Often, different stakeholders have conflicting views on the features or capabilities that a product roadmap should include. Such conflicts lead to unpleasant conversations, strained relationships, and a demotivated team.

 

The OKRs framework brings focus to the purpose or objectives that a product has. The stakeholders start to think in terms of the product vision and its goals that they are trying to achieve. With OKRs, there’s also a better clarity on the success metrics or the key milestones for each product objective.

 

“OKRs are clear vessels for leaders’ priorities and insights.” -  John Doerr

 

The other common problem these days is lack of measurement or tracking of the specific outcomes or product goals. Teams continue to build new features and capabilities for the product but seldom measure the outcome or the result.

 

With the OKR model, Key Results (KRs) are measured and tracked periodically.

 

“If the focus is delivering something the customer wants, you must move from primarily measuring outputs to primarily measuring outcomes.” - Mario E. Moreira

 

But does one size fits all? No, OKRs are not meant for all enterprises. OKRs will not work for you when:

 

  • OKRs are not agile: When OKRs are rigid, the model does not provide any room for people to make mistakes, abandon OKRs, or be agile. The OKR model is meant to inspire people and drive better alignment, focus, engagement, and performance.

 

  • OKRs don’t flow quickly down the corporate hierarchy: Some enterprises find it difficult to align corporate OKRs with portfolio and team OKRs. Thus, it takes a considerable amount of time for them to cascade strategic OKRs to the teams.

 

  • When conflicting priorities are tough to resolve: With conflicting priorities, planning becomes a nightmare and it might consume a considerable amount of time and effort to lock down OKRs for each quarter.

 

If you would like to read more on OKRs and Enterprise Agility, you might like my latest book, Enterprise Agility with OKRs.

 

Download the FREE Agile templates for strategic planning:

  • The Product Persona Template
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