getting started with okrs

7/25/2019 Getting Started With Okrs

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Introduction 4

The Basics. What are OKRs? 5

The Right Fit. Are OKRs Only Useful for Certain Organizations? 8

Setting OKRs. Where to Start? 9

A Closer Look. How Did John Doerr Explain OKRs? 11

More OKR Examples 12

Cadence. How Often Should OKRs Be Set? 14

Teams. How Do OKRs Engage a Multi-Generational Workforce? 16

Measurement. How Should OKRs Be Scored (or Should They)? 18

Human Resources. How Do OKRs Work with Performance Management? 19

Potential Issues. How Can Enterprises Address Them? 21

Input and Tracking 22

Next Steps. How Do Organizations Extend OKRs? 23

About BetterWorks 24


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Since the 1950s, business leaders have embraced a variety of

management techniques designed to improve employee performance.

Peter Drucker introduced !"#"$%&%#' )* +),%-'./%0 1!2+03, a processduring which management and employees dene and agree upon

objectives and what they need to do to achieve them. In the early 1980s,

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S.M.A.R.T. Goals help remind employees that every goal they set should be:

But goal setting has evolved since the introduction of S.M.A.R.T. Goals

more than 30 years ago. Best practices are to create specic, measurable,

relevant and time-related OKRs, but rather than always be attainable,

some OKRs should be aspirational.

Companies that are recasting the A from attainable to aspirational

may not always achieve their goals, but they foster greater innovation

by encouraging workers to push their limits. OKRs are more akin tostretch goalsa little uncomfortable and slightly out of reach.

Beyond S.M.A.R.T. Goals, OKRs also help organizations better answer other

meaningful questions: who is involved with a goal? How does the person

setting goals get feedback and measure progress? Why is a goal important

to the individual and the company?

Specific

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OKRs are a good t for all types and sizes of organizations because they

lead to the organizational alignment that drives operational excellence.

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In organizations with many departments, its critical for all members

of the teamacross teams, top to bottom, and across functionsto

be able to provide feedback and input into the goal-setting process.

By making everyones goals transparent and visible, organizations can

attain and maintain alignment. The process of recording operational

goals (e.g., grow revenue, hire employees, etc.) and aspirational goals (e.g.,

how an individual will help the company move into a completely dierent

space, revolutionize a market, etc.) drives operational excellence. Google

successfully used OKRs to grow from 40 to 40,000 employees. OKRs can

also be eective tools for retaining top talent.

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The most dicult step for many organizations is committing to the

OKRs process. Businesses should identify an OKRs champion who fully

understands the benets of the approach and can help teams that may

be having diculty getting started or staying on track. This person is

often a chief executive, line-of-business leader, operating ocer or

human resources professional.

OKRs are a multi-step process. Businesses may choose to roll out the

entire OKRs process at once or simply one step at a time:

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It is important to start with and keep teams centered on four-to-six

objectives at a time with ve or fewer key results for each objective.

Focus will yield the best results for employees at every level.

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From a practical standpoint, OKRs typically fall into two large buckets:

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These goals have to do with a companys metrics, such as product

releases, bookings, hiring, number of customers, etc. They are the

organizations operating drumbeat. Management will typically set

these at the company level while employees set operational goals

at departmental levels.

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In contrast to operational goals, aspirational goals are bigger picture

ideas about how a company is going to go about changing the world.

These goals set the scene and are designed to help all employees gure

out how they can contribute to the aspirational ideas. Aspirational goals

can come from any level in the organization.

Both sets of represented goals must be as measurable as possible

and measurement should be linked, for example, I will accomplish

this goal by doing x, y and z. When both operational and aspirational

goals are visible, all employees know how a company is oriented and also

understand that thinking big is required. Additionally, some operational

goals may be aspirational because one size does not t all.

Forrester Research. Disrupt the Employee Performance Process to Align with Business and Customer Outcomes,

Paul D. Hamerman and Claire Schooley, July 2, 2014.


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Table 1 is an example of OKRs that a senior executive might set. Because

employee goals typically cascade from management goals, Table 2 provides

examples of line-of-business manager OKRs from various departments

across the business.

OPERATIONAL

ASPIRATIONAL

OBJECTIVES

OBJECTIVES

KEY RESULTS

KEY RESULTS

Senior Executive OKRs

Senior Executive OKRs

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Close three deals over $10M

1 Move into the Challengers category of the Gartner Magic

Quadrants (MQs)

1 Increase upgrade conversions to 10%

1 Engage customers through features voting (see innovation objective)

1 Institute suggest your own feature within product by 2/15

1 Institute bi-annual, company-wide NPS survey

1 Sign partner agreement to expand into Latin America by Q2


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Well-developed OKRs are very powerful tools. Employees across the

company, even those located globally, can link their goals to the corporate

goals, knowing that their work is having a direct impact on the success of

the business. Moreover, corporate goals should be inclusive of ideas that are

created at the individual contributor level, which keeps senior leadership in

tune with the organization. For example, at least 60% of objectives at many

companies come from the bottom up because too much top-down dictation

kills motivation and aspiration.

OPERATIONAL

ASPIRATIONAL

OBJECTIVES

OBJECTIVES

KEY RESULTS

KEY RESULTS

Manager OKRs (Various Departments)

Manager OKRs (Various Departments)

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1 Enable digital signatures for purchase orders

1 Add a systems engineer to each proof of concept

1 Meet with Gartner analysts publishing relevant MQs

1 Get three reference customers to speak with Gartner analyst

1 Grow per day views to 10,000 by personalizing content

1 Run quarterly phone blitz campaign targeting top 100 customers

1 Trial three new similar product features per quarter, enable

users to vote1 Collect results and solicit other ideas

1 Build most popular features into Q2 product release

1 Develop NPS survey by 1/20

1 Automate survey distribution and results collection by 2/15

1 Read out results within 30 days

1 Engage with ve possible partners

1 Conduct due diligence by Q1

1 Work closely with legal to develop contract terms by Q2


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In Start-Up Speed, Kristen Gil, VP of Business Operations at Google,

explains some of the changes Google instituted to help it operate at

small business speed, even as it grew.

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Although the Baby Boomer generation dominates the workforce today,

many older employees will retire in the next 10-15 years. The challenge

for businesses is to replace this group that currently holds leadership

positions with new talent that keeps innovating. CEB recently completed

a Talent Report, based on millions of assessments of employees

worldwide. The results (shown in Table 1) identied six motivational

factors that any manager must be aware of to engage and retain a

multigenerational workforce.

In the PWC Millennials at Work report, authors oered six suggestions

to businesses to help ensure they understand the millennial generation

and are acting to attract and inspire the best of them:

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workforce to better understand and address generational

dierences and tensions

C W%' 'E% X@%":Y =.$E' Ensure everyone knows what is expected

C I%:P &.::%##.":0 $=9G Understand personal and professional goals

C V%%@)"-RS >%%@)"-RS "#@ &9=% >%%@)"-R Give real-time,

honest feedback

C 4%' 'E%& >=%% Provide exibility yet clear instruction and

concrete targets

C L#-9B="$% :%"=#.#$ Deliver continuous training and development

C 6::9G >"0'%= "@/"#-%&%#' Value results, not just seniority

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OKRs are an ideal way to help organizations manage and keep

generational groups working toward common objectives. By establishing

clear goals and making them visible company wide, everyone on the

team gains a better understanding of what tasks are important to

whom, how individuals prioritize them, what motivates employees

across generations and how the workforce can team to achieve success.


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Although whether to measure OKRs or not may be a topic of debate in

an organization, there should be no question as to whether OKRs should

be tied to P%=>9=&"#-% %/":B"'.9#0. The answer is they should not.

As a best practice, OKRs should be decoupled from performance

evaluations so individuals feel free to take more innovative risks than

they might otherwise. Separating the two also means employees wont

spend time trying to game the system to reap rewards. Performance

management systems are typically subjective and can be extremely

demotivating. In contrast, OKRs are designed to bring alignment, focus,

better coordination, and sometimes even fun, to companies. 6

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The question may also arise as to whether human resources (HR) should

be responsible for the OKRs process in the organization. According to

Josh Bersin, Principal and Founder of Bersin by Deloitte, The HR role is

a dicult one today because leaders are being asked to continue to do

their job of making sure the business and employee interactions are fair,

in compliance, and dont create risk for the business. HR professionals

are also now being asked to be innovators. I think HR teams can be great

facilitators to their businesses without having to own every domain.

Although HR may not be the champion for the business, HR sta

can actively help to make the transition to the OKRs process and the

on-going adoption of OKRs a smooth process.

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Inevitably, there will be some trial and error as executives, managers

and employees adopt the OKRs process. Because one size does not

t all, the OKRs champion should be aware of individuals and teams

nding the most success and those having the least success with OKRs,

and work to understand why. Critical assessment, especially in the rst

few quarters of a roll out, and modications to the process will be keys

to on-going success.

As adoption grows, OKRs champion John Doerr and others recommend

addressing the following potential issues early:

C K"-R 9> 0BPP9=' "-=900 'E% %#'.=% 9=$"#.Z"'.9# For OKRs to be

eective, goals must be supported by the entire organization. Every

team and working group should agree on goals and priorities.

C K"-R 9> "--9B#'").:.'* Just setting goals isnt enough. Goals must

be measurable or have quantiable targets. From shipping a certain

number of products to hitting a release schedule, teams have to be

able to track and measure the goals they set.

C K"-R 9> =%":.'*S %0P%-."::* '.&.#$ Goals should be aggressive yet

realistic. Individuals and teams should stretch, but not to the point

of breaking.

C K"-R 9> =.0R OKRs should not be tied to bonus payments.

Organizations should think about using OKRs to build a bold,

risk-taking culture.

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When an organization has fewer than 10 employees, setting and sharing

OKRs in a Google doc or an Excel spreadsheet may be practical. Yet as a

business grows, it requires a more robust enterprise goal-management

platform to capture, share and track progress toward key objectives

and results.

Any business evaluating software to track OKRs or manage goal setting

should ask a potential provider whether its oering includes the

following critical goal management capabilities:

T5 Does the software support both bottoms-up origination of OKRs

with individuals, as well as top-down, cascading processes where

managers dene OKRs for their direct reports?

[5 Can OKRs cross teams to enable horizontal alignment/ag

dependencies or must they be set up separately for each team as

dictated by the organizational chart?

\5 How easy is it to access updated OKRs? Are there mobility options?

]5 Can anyone see a history of how OKRs change over time? Is

charting available?

^5 How does the software encourage behaviors, such as frequent

check-ins, to keep goals and progress fresh?

_5 How easy is it for colleagues to support, collaborate, encourage and

comment on one anothers goals?

`5 What engagement techniques exist in the software to drive adoption,

usage and re-engagement? Are there notications, social gestures

and feedback loops?

a5 What dashboard capabilities exist to serve as an early-warning

system for the company? At the executive level, the manager level,

and individual level, what types of notications are available?

b5 What examples of enterprise-scale deployments has the

software served?

Tc5 Does the software try to combine many other features, or does it

really solve the OKRs problem deeply? And most important, will

employees actually want to use rather than it being forced on them?


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Todays best practices for managing and tracking business objectives

include modern Goal Science thinking based on ve pillars:

Modern goal-setting platforms support these practices by ensuring goals

are easy to set, manage, track and see throughout an organization.

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