Q&A: Getting started with OKRs
In the first webinar of our three-part OKR Maturity Model series, OKR experts and Intel alumni Howard Jacob and James Cape, along with Ally.io’s Product Marketing Director Jes Baum, discussed creating the right company culture through mission, vision and values, as well as how to get started with OKRs. Here are the answers to the questions you asked.
What's the best way to get teams on board?
It takes executive buy-in and leadership. For a SMB, start with the executive team. For a large corporation, it could be piloted within a single business unit. - James
If my company/team has implemented OKRs, should I own a KR (Key Result)?
OKRs are all about transparency. So yes, everyone in the org that has defined and implemented OKRs should have a KR that contributes to the organization's objectives. - Jes
What's the difference between KPIs and KRs?
KPIs and KRs are both success metrics. Essentially KPIs are your KRs with intention behind the goal. -Jes
How should leadership follow through with their teams to make sure everyone is updating their OKRs?
As OKRs are being developed and rolled out, it should be a part of the weekly leadership staff meetings. Once established, a monthly leadership team review cadence combined with reviewing individual team members' OKRs during management 1:1s is a good approach. - Howard
How do you avoid connecting an individual's OKRs directly with their performance? What place do OKRs play in a performance review?
While a performance review should take into account accomplishments for a certain time period, it is only one vector for evaluation. Equally critical is performance to the company values. If achieving results is done in a destructive way, then results are highly mitigated. -James
How long does it take to implement OKRs across an organization?
It depends. For the growth stage startup that I'm currently advising, we did a two-day workshop for the entire exec team on MVV and OKR development in early March, then a sub team began refining the 2020 Corp OKR draft we developed. Then came COVID and a focus on business continuity for three weeks, and a return the the OKR process. We've finalized the 2020 and most of Q2, and have begin working on Q3. I expect that by Q4 they will have the experience and cadence in place to be fully implemented for 2021. - Howard
What is the biggest mistake people make when first setting their OKRs?
First and foremost -- not starting the process in the first place. Patience and iteration is key and few, if any, organizations "get it right the first time." It is important also to "bake" the process into the cultural DNA of an organization. This will help focus, align and prioritize activities while allocating resources. -James
How do mission, vision, and values relate to strategy?
MVV sets the overall framework for who the company is, what they do, where they want to take the world, and how they do it. Strategy defines the path they will take to achieve their mission and vision, and the OKRs is the methodology to execute that strategy. - Howard
How does the OKR framework or the OKR software balance between bottom-up and a top-down approach?
The initial path for MVV, strategy, and OKRs are by necessity top-down. The fact that those individuals and teams who are doing the work are the best people to identify potential issues and refinements to the OKRs can use their visibility for both their own work and those of related teams to suggest revisions to the OKRs during their regular 1:1 meetings with their managers. These suggestions can be vetted as required by the respective teams and used to refine the OKRs. - Howard
Is there any benchmark or guideline in terms of how many OKRs a 100-person company should have?
Start with making sure you spent the time to fully vet your mission, vision and values -- this is foundational and helps create a culture where OKRs can easily flourish. With that in mind, I recommend no fewer than three and no more than six. -James
With OKRs, how do you get the right balance between embedding your long term (visionary) objectives while also staying agile enough to respond to or take advantage of changing market dynamics?
There are two distinct categories of OKRs. At Google, the long term visionary BHAG (Big Hairy Audacious Goals) OKRs are aspirations, typically require multi-year efforts, and while progress is expected to be made, a failure rate of up to 40% is not unexpected. Committed OKRs, like for product delivery and revenue, are expected to be graded at 100%. - Howard
Who exactly in an organization should start this approach? Most of the time these are spoken during a yearly KPI, but after that it's really hard to practice as the leaders don't preach such good practice. In that case how to fall in line?
Ideally someone in leadership should champion the process, but there is no reason a team can't start the process. The biggest point is to get started. Like all newly adopted processes, it takes time and iteration to determine the best approach and cadence. It is important to understand that KPIs are not OKRs. KPIs are metrics and can be a proxy for key results. Organizations should be careful not to go overboard on adopting too many KPIs as you can get to the point where you are measuring so much that you "lose the forest for the trees." Selecting the most relevant and impactful KPIs is essential so you measure what matters (to quote John Doerr). - James
If an OKR for a marketing team depends on the products team to build a new product feature/launch, and in turn, the products team wants marketing team to market and grow their new product feature/launch investment....how is this handled?
Great question, and it truly addresses the strength of the OKR methodology. If the company has a major product introduction, which is a top objective, then product marketing and design have to negotiate the specs; engineering and design have to deliver to that spec; manufacturing, quality assurance, and testing have to be ready; sales has to be trained; and marketing has to deliver customer collateral, a launch event, and press coverage. The annual corporate objective would be "Develop and deliver our world class widget as measured by:". There would be a key result for each of the organizations mentioned above who have a role in delivering, marketing and selling the product. Those key results would then become an objective for each of those teams, which would then have the appropriate KRs defined for each of the teams and individuals with roles to play in that product development and launch. These annual OKRs would then be parsed into quarterly OKRs to achieve the annual objective, and the teams would manage to those OKRs. - Howard
How do we ensure that we are developing appropriate OKRs?
At the highest level an objective is "what" needs to be achieved and the key result is "how" you are going to achieve something measurable. In an optimal OKR process, annual OKRs are set by the leadership team with considerable input from front line employees. Then the organization as a whole takes the top level OKRs and develops their own. In many cases, all downline organizations will have a role in achieving top level OKRs, but management should allow all contributors to allocate 10-20% of their OKRs to "special" projects -- this will allow groups/teams to spend time on innovative programs that can provide valuable future direction to the organization overall. - James
How do you make an OKR framework or methodology work?
You need the commitment and engagement of the leadership team within the organization in order to get started. From there, either training or self learning on the methodology for the leadership team, and the definition of the mega tasks that they need to achieve over the next 12-18 months. The next step is to utilize and/or develop/refine the current MVV, and use that and the mega tasks to develop 3-5 annual objectives and the key results required to achieve those objectives. - Howard
Who is actually responsible for OKRs?
The CEO should really be the champion for OKRs and/or P&L owners -- that said, there is no reason why a down organization team can't start their own OKR process to optimally manage their activities. I would hesitate having HR drive the process -- based on my experience you run the danger of turning OKRs into a proxy for performance assessment, which it is not. That said in an ideal world, HR is a key stakeholder and driver of the OKR process. Also, in the best run organizations, the OKR process is thoroughly baked into the DNA of the entire organization. - James
What is one of the most common mistakes that you see teams make when starting the OKR process?
Too many OKRs, and making a long task list. OKR should not be a list of tasks, but instead, time bound, actionable and measurable outcomes you want to achieve. - Jes
I'd love more insight into how I get "buy-in" to OKRs throughout the organization?
Like any process change, the biggest challenge is changing people's behavior. If the process is championed by the CEO, then requiring the senior leadership team to publish their OKRs can greatly help -- then put an OKR check in review for EVERY staff meeting, where all senior team members need to provide updates and interim grading for all their OKRs. This will also give the team an opportunity to see if any adjustments need to be made. Also assigning an OKR champion/evangelist can be very helpful -- I was responsible for teaching the OKR process for a geographically dispersed company of 200+ people and it really helped to conduct team level training using the annual OKRs as the foundation for getting people to think about what their role was to successfully achieving them. - James
Our following two webinars focused on breaking down the OKR Maturity Model and supporting an upward OKR journey.
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