Most companies have Missions that are customer centric. After all, having happy customers is at the heart of everything we are all trying to do and the only way to grow.
For this reason, I’d propose that every company strategy should have at least one Customer Experience based pillar and related Objectives. For an early stage tech company your Objective might be: ‘Achieve Product Market Fit’. As you scale this could evolve. Something like: ‘Amazing CX at every touchpoint’.
OKRs aka Objectives and Key Results are the go-to goal setting framework for fast growing agile teams. They allow a company to define a strategy, create aligned objectives and describe how success will be measured.
Table of Contents
Back in the 1970 Intel used ‘Management By Objectives’. Andy Grove was later to take this framework and evolve it into the goal setting framework called Objectives and Key Results (OKR), and deploy them with game-changing results.
A then Intel colleague, John Doerr, introduced OKR to Google when Google was a handful of people. The rest is history, with most tech companies using OKRs to align strategy with goals throughout the company.
If you’re new to OKR, an objective is a description of the objective that should read a bit like a Mission Statement, being both ambitious and inspirational. The Key Results are 1 – 4 ‘As measured by’ statements that quantify the Objectives achievement.
OKR planning starts with a company strategy. From this every year a company can create a few Company OKRs that describe the ‘key battlegrounds’, areas of focus and change, and quantify what success would look like.
Departments, teams and individuals get presented with these and are invited to plan their own set of OKRs that would align with these. This bottom-up empowerment of employees is a big deviation from top-down ‘command-and-control’ goal setting.
In both examples, these OKRs are not describing business-as-usual (BAU) aspects of the business, with BAU containing the job, processes, systems and metrics that keep the business operating, and for the most part would be considered to be operating a a good or ‘good enough’ level.
When employees are not working on their BAU activities, OKRs are the answer to ‘what should I focus on’. So having too many goals is also an issue as this can create confusion and dilute attention from what really matters.
Another aspect of OKR is the targets are meant to be hard to achieve and a stretch. Setting hard goals improves focus, attention and inspires better performance.
The final key aspect of OKR is they are meant to be part of a weekly, monthly and quarterly discussion cadence. The old-school ‘set and forget’ goal should be a thing of the past. Which aligns OKR with agile ways of working.
In summary then, OKR when used as intended are meant to be:
Despite OKRs being the antidote to command-and-control management they are often used by leaders looking for this, yet not wanting to miss out on using OKR. So they end up actually using OKRs ‘in name only.
Everything a business is doing is codified as an OKR, and there is no clarity on what really matters. The company’s strategy and BAU are all lumped in so management can get a granular view of everything. There is no autonomy, no empowerment, and poor working practices like micromanagement are still prevalent.
Employees are told that the window on their contribution to their company is the OKR. So employees describe what they are doing in OKR form. Activities become Key Results, not measurable outcomes. Targets can also become less of a stretch as the motivation to look good when it’s time to be appraised is just human nature responding to the systems and processes the company has created.
The planning, updating and meeting overhead then becomes more significant as OKR becomes an exercise in describing and justifying everything, not an exercise in how you deliver the few things that matter.
If the benefits of OKR are to deliver a strategy using a network of empowered, autonomous and agile teams, not afraid of taking risks. The opposite happens.
Too many OKRs obscure what matters. Activities obscure the desired outcomes. Individual performance concerns prevent ambition, and frequent meetings about things that don’t matter reduce productivity.
What’s worse is, micromanagement didn’t ever leave the building. Micromanagers have a window on what turns out to be sub-optimal performance. Their default response being to increase micromanagement or put the blame on the OKR framework. Calling it ‘complicated and time-consuming’ – it’s actually simply and time saving!
Here are two company OKRs that use the Objective examples from above. This time measurable Key Results have been added. Key Results are how Objective success is measured.
Achieve Product Market Fit
Amazing CX at every touchpoint
These annual company OKRs are an invitation for Customer Service or Success, Product Management, Engineering, Marketing and Sales to discuss, align and propose OKRs that are outside their normal business-as-usual activities, that would support these goals over the coming quarter. They might even propose OKRs as a cross-functional team.
For example, Customer Service might consider the biggest challenge they have right now is having current and accurate product / customer analytics that can predict churn. The Objective & Key Results for the coming quarter could be to:
How the company goes about achieving this ‘hard’ stretch goal is to involve Product, Engineering and the CS team. Analytics needs to be improved, calls need to be made and issues shared and discussed, product management and engineering need to provide ‘customer saving’ features where reasonable, and CS might need to improve product training. These are the activities or Initiatives that power OKR achievement.
This OKR might only be around for a Quarter as when performance reaches a ‘good enough’ level, the best more impactful OKR opportunity might be something else. These metrics are then monitored and tracked as KPIs or ‘Health Metrics’.
From these examples you have hopefully noted that OKRs are not how you run the business-as-usual operations of your company. OKRs are how you get clarity on what matters most now. This allows you to align, commit and deliver on your most important goals. If everything is important it dilutes focus from what really mattered.
Every week these OKRs are the topic of team conversations. Problems are shared, wins are celebrated, and any adjustments that might be required are done at a pace. This fast cadence and commitment to staying focused is another core pillar of OKR.