Objectives and Key Results
Objectives and Key Results (OKRs) is a framework for defining and tracking objectives and their outcomes.
The development of OKRs is generally attributed to Andy Grove, the "Father of OKRs", who introduced the approach to Intel. John Doerr learned about this whilst at Intel and took it to Google, where it became a central part of their management culture.
OKRs should be driven by strategy; they cannot be created solely in isolation by the team, and should be closely aligned to or cascade down from the business Vision or Mission(s).
As such, the business needs to strongly support rolling out the framework. This often requires a culture change - there cannot be a project mindset, and everyone must strongly focus on outcomes not outputs, measuring success in terms of business value rather than features completed.
Objectives are:
- Qualitative - communicate intent not tactics.
- Inspirational — the team's purpose, what gets people out of bed in the morning.
- Aspirational stretch goals - difficult but not impossible, aggressive yet realistic.
- Time bound — actionable in a quarter to a year — any longer than this and the objective is probably more of a strategy.
- Independent - actionable by the team. Avoid creating external dependencies.
- Focused - prioritise what matters most - ideally only create a single objective.
- Crafted by the team - written in their language.
Although not explicit in all guidance it is recommended that externally-mandated tasks are measured separately. It can be hard to mask a "just do it" request as inspirational, and it is better to call this out and manage differently. Refer to these as committed tasks and don't consider them as an OKR.
Key Results are:
- Quantifiable - indicators of objective success.
- Baselined - include metrics for what you want to improve, ideally from X to Y. Note that there may be an amount of work required to surface this data.
- Not activities / tasks
- Limited to 3-5
- Reviewed regularly and graded using any scale that works for you, such as by confidence / % complete / scale 0.0 - 1.0 / emojis
- There are typically only 5 types of metrics - it is recommended to include a combination of different types in your KRs:
- Growth
- Engagement
- Revenue
- Performance
- Quality
Example OKRs
Example 1 (Poor quality)
Remove dependency on legacy CMS to manage content.
- Content can be created without using legacy CMS
- Content can be published without using legacy CMS
- Existing content can be surfaced on the website without using legacy CMS
This example is very task-based, and the metrics are not quantifiable. It could also be argued that this is not inspirational, and should be managed as a committed task.
Example 2 (Better)
Continue our quest to make search the best search experience out there.
- QUALITY: 75% of users score our new search as good or very good.
- ENGAGEMENT: Increase conversion in search by 10%.
- PERFORMANCE: Reduce time it takes to render a search result by 5%.
The Objective is inspirational and focused, and the KRs allow for different types of metrics. However, these are likely to suffer from confusion when reviewing - for example, how do we score "good" or "very good"? Is this a rating scale? What's the method for collation? How is conversion defined? There are also no baselines included.
An improved version is shown below:
Example 3 (Best)
Continue our quest to make search the best search experience out there.
- QUALITY: average score for search increases from 3/5 to 5/5 in our user satisfaction survey.
- ENGAGEMENT: increase percentage of users who go on to view a content item from a search results page from 72% to 82%.
- PERFORMANCE: reduce average time it takes to render a search result from 2 seconds to less than 1 second.
Creating OKRs
- Schedule a meeting with the team likely to be involved in the implementation of the OKRs.
- Reiterate the business Vision and Mission before the meeting, and ask each team member to propose one Objective.
- Have one person collate the Objectives to input into the meeting.
- Set up sessions for 4.5 hours (typically two two-hour sessions, with a 30-minute break).
- One goal of the first session should be to be able to cancel the second session - gives the team an incentive to focus.
- Before the meeting, add the gathered Objectives to a board. This could be a physical board, or a remote whiteboarding tool.
- Add to the Objectives if needed, remove any duplicates, and collate.
- Discuss, debate, decide!
Creating Key Results
- Once the objective has been agreed, call another meeting to define key results.
- "How will we know we achieved our objective?"
- "What metrics would have changed?"
- Ask the team to free-list as many key results as they can think of in 10 minutes.
- Remove any duplicates and collate.
- Ideally, have a usage metric, a revenue metric, and a satisfaction metric.
Tips
- Communicate objectives obsessively. Reiterate continually. Report progress regularly.
- When starting out, aim for one. Start small! You don't need to define all the work a team might do.
- Involve the team in the process — they won't feel ownership unless they create the OKRs.
- Ensure OKRs are aligned to business strategy.
- Persevere — it's hard to get right!
Reading
Books
- Radical Focus - Christina Wodtke
- Measure What Matters - John Doerr Note - this is one of the most prominent books on OKRs. However, there are a number of confusing and contradictory points included, as discussed in this article.
- High Output Management - Andy Grove