How was the book?

Hey all you techies and business innovators – this is the book for you. John Doerr is presenting two methods. The First is called Objective Key Results (OKRs) method and emphasis on the methods is on OKRs. The second is Conversation, Feedback, Recognition (CFRs) method. Then there is also a huge bonus, demonstrating via cases how these methods work properly. Cases include corporations such as Intel, Google and startups like Remind, Zume Pizza and Nuna. I could find numerous resemblance to the Lean Startup by Eric Ries.

Read this book slowly and do not hasten, because there is much to think about. Even the quotes from great thinkers should be considered with care. At the end of the book there is different resources to implement the OKRs and how to use CFRs.

What are the key learnings of the book? 

”As much as I hate process, good ideas with great execution are how you make magic. And that’s where OKRs come in.” (Larry Page)

In the OKRs the objectives are the stuff of inspiration and far horizons. Key results are more earthbound and metric-driven. They typically include hard numbers for one or more gauges: revenue, growth, active users, quality, safety, market share, customer engagement. A manager “must be able to measure … performance and results against the goal.” (Peter Drucker)

OKRs

Key questions in OKRs are WHAT and HOW. OKR methods is based on former CEO of Intel – Andy Groves thinking. He innovated his own way of deploying scientific management and Peter Druckers wisdom. OKR’s is “a management methodology that helps to ensure that the company focuses efforts on the same important issues throughout the organization.” As a method it ”is a collaborative goal-setting protocol for companies, teams, and individuals.

They cannot substitute for sound judgment, strong leadership, or a creative workplace culture. But if those fundamentals are in place, OKRs can guide you to the mountaintop.”

A few goal-setting ground rules?

”Don’t allow the perfect to be the enemy of the good.” (Voltaire)

Key results should be succinct, specific, and measurable:

I) ”An OBJECTIVE is WHAT is to be achieved, no more and no less. By definition, objectives are significant, concrete, action oriented, and (ideally) inspirational. When properly designed and deployed, they’re a vaccine against fuzzy thinking—and fuzzy execution.

II) KEY RESULTS benchmark and monitor HOW we get to the objective. Effective KRs are specific and time-bound, aggressive yet realistic. Most of all, they are measurable and verifiable.”

OKR x 4

OKR has four superpowers: Focus, alignment, tracking, and stretching:

I) Focus and Commit to Priorities: What’s important, and what’s not. ”OKRs impel leaders to make hard choices.”  

II) Align and Connect for Teamwork: Everyone’s goals are openly shared. ”Individuals link their objectives to the company’s game plan, identify cross-dependencies, and coordinate with other teams. By connecting each contributor to the organization’s success, top-down alignment brings meaning to work.”

III) Track for Accountability: ”OKRs are driven by data.” They are animated by periodic check-ins, objective grading, and continuous reassessment—all in a spirit of no-judgment accountability. An endangered key result triggers action to get it back on track, or to revise or replace it if warranted. ”

IV) Stretch for Amazing: ”OKRs motivate us to excel by doing more than we’d thought possible”

According to Edwin Locke ”“hard goals” drive performance more effectively than easy goals. Second, specific hard goals “produce a higher level of output” than vaguely worded ones. Among experiments in the field, 90 percent confirm that productivity is enhanced by well-defined, challenging goals.”

How to apply OKR?

“Bad companies are destroyed by crisis. Good companies survive them. Great companies are improved by them.” (Andy Grove)

Measuring what matters begins with the question: What is most important for the next three (or six, or twelve) months?

Less is more.

– “A few extremely well-chosen objectives about what we say ‘yes’ to and what we say ‘no’ to.” A limit of three to five OKRs per cycle. Each objective should be tied to five or fewer key results.

Set goals from the bottom up.

– Teams and individuals should create roughly half (50%) of their own OKRs with managers.

No dictating.

– OKRs are a cooperative social contract to establish priorities and define how progress will be measured. Collective agreement is essential.

Stay flexible.

– Key results can be modified

 Dare to fail.

– While certain operational objectives must be met in full, aspirational OKRs should be uncomfortable and possibly unattainable. “Stretched goals push organizations to new heights.”

A tool, not a weapon.

– ”The OKR system is not a legal document upon which to base a performance review.” OKRs and bonuses are best kept separate.

Be patient; be resolute.

– ”An organization may need up to four or five quarterly cycles to fully embrace the system.”

“Innovation means saying no to one thousand things.” (Steve Jobs)

CASE: Zume Pizzas OKRs

”OKRs were our Esperanto, our shared vocabulary.”

– OBJECTIVE Complete the Truck Delivery Fleet for 250 Polaris (Mountain View HQ).

– KEY RESULTS

1. Deliver 126 fully certified ovens by 30.11.

2. Deliver 11 fully certified racks by 30.11.

3. Deliver 2 fully certified full-format delivery vehicles by 30.11.

CFRs

”We don’t hire smart people to tell them what to do. We hire smart people so they can tell us what to do.” (Steve Jobs)

Continuous performance management is implemented with CFRs:

A) Conversations: an authentic, richly textured exchange between manager and contributor, aimed at driving performance

B) Feedback: bidirectional or networked communication among peers to evaluate progress and guide future improvement

C) Recognition: expressions of appreciation to deserving individuals for contributions of all sizes

Focused, transparent OKRs knit each individual’s work to team efforts, departmental projects, and the overall mission. As a species, we crave connection. In the workplace, we’re naturally curious about what our leaders are doing and how our work weaves into theirs. OKRs are the vehicle of choice for vertical alignment.

Micromanagement is mismanagement.

”When our how is defined by others, the goal won’t engage us to the same degree.”

Do not try this at home…. If an HR manager got stuck trying to connect to the high-level goals for product or revenue, we’d add a top-line objective just for that person.

”Each time we went through the OKR process, we did a little better. Our objectives got more precise, our key results more measurable, our achievement rate higher. It took us two or three quarters to really get the hang of it.” (MyFitnessPal)

How to get better with OKRs?

Quarter to quarter, day to day, they look for tangible measures of their achievement. ”The best-in-class platforms feature mobile apps, automatic updating, analytics reporting tools, real-time alerts, and integration with Salesforce, JIRA, and Zendesk.

– They make everyone’s goals more visible. Users gain seamless access to OKRs for their boss, their direct reports, and the organization at large.

– They drive engagement. When you know you’re working on the right things, it’s easier to stay motivated.

– They promote internal networking. A transparent platform steers individuals to colleagues with shared professional interests.

– They save time, money, and frustration. In conventional goal setting, hours are wasted digging for documentation in meeting notes, emails, Word documents, and PowerPoint slides. With an OKR management platform, all relevant information is ready when you are.

“The single greatest motivator is ‘making progress in one’s work.” (Daniel Pink)

Don’t be a tourist, be the guide

OKRs are adaptable by nature. As Peter Drucker observed, “Without an action plan, the executive becomes a prisoner of events. And without check-ins to reexamine the plan as events unfold, the executive has no way of knowing which events really matter and which are only noise.”

For best results, OKRs are scrutinized several times per quarter by contributors and their managers. A manager’s “first role is the personal one. It’s the relationship with people, the development of mutual confidence … the creation of a community.” (Peter Drucker)

CASE GOOGLE: Google’s benchmark check-in cycle is monthly, at a minimum. Tremendous value can be gained from post hoc evaluation and analysis. In both one-on-ones and team meetings, these wrap-ups consist of three parts:

I) Objective scoring,

II) Subjective self-assessment, and

III) Reflection.

Scoring

0.7 to 1.0 = green. (We delivered.)

0.4 to 0.6 = yellow. (We made progress, but fell short of completion.)

0.0 to 0.3 = red. (We failed to make real progress.)

Self-assessment

”You’re a public relations manager, and your team’s key result is to place three national articles about your company. Though you get only two pieces published, one is a cover story in The Wall Street Journal. Your raw score is 67 percent, but you say, “I’m giving us a 9 out of 10, because we hit that one out of the park.”

Reflection

– Did I accomplish all of my objectives? If so, what contributed to my success?

– If not, what obstacles did I encounter?

– If I were to rewrite a goal achieved in full, what would I change?

– What have I learned that might alter my approach to the next cycle’s OKRs?

Google divides its OKRs into two categories:

I) Committed objectives are tied to Google’s metrics: product releases, bookings, hiring, customers.

II) Aspirational objectives reflect bigger-picture, higher-risk, more future-tilting ideas. Leaders must ask themselves: What type of company do we need to be in the coming year?

”Tell me and I forget, teach me and I may remember, involve me and I learn.” Benjamin Franklin

How should we change according to the book?

Use timing, public OKRs and avoid organizational poisons.

Timing is everything in OKRs, because OKRs keeps everybody centered and on track. They guarantee that things gets done in time and ”It’s definitely a team-building process.”

Research shows that public goals are more likely to be attained than goals held in private. Critiques and corrections are out in public view. Contributors have carte blanche to weigh in, even on flaws in the goal-setting process itself.

OKRs make objectives objective, in black and white and organizational poisons—suspicion, sandbagging, politicking—lose their toxic power.

And transparency seeds collaboration.

What should I personally do? 

Start using my OKRs in the all-hands meetings.

Summary

The book in six words – ”In God we trust; all others must bring data.” (W. Edwards Deming)