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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
Transform your organization and get everyone pulling in the same direction by doing OKR's better The spiritual successor to KPIs (key performance indicators), OKRs, or objectives and key results, are rapidly gaining popularity and helping some of the world's most successful businesses solve their strategic execution problems. However, some companies struggle with their implementation, finding that using OKRs as top-down directives changes little. In OKR's for All, Objectives and Key Results (OKR) expert Vetri Vellore delivers an impactful and actionable guide on how to use OKRs for more than a quarterly, executive-level review tool. You'll discover how to roll out an OKR system that closes the gap between strategy and project, and starts at the bottom of your organization and helps managers and teams organize their daily decisions around shared and important goals. You'll find: * A seven-part blueprint and framework to strategically put purpose at the center of your work, whether you are a CX, team lead, or individual contributor. * How to build an OKR strike team, align your departments, manage your people, and roll out your new strategic OS. * Valuable and implementable case studies from companies you know and love * Best practices to follow and common pitfalls and mistakes to avoid when applying OKRs throughout your organization Perfect for founders, executives, managers, and employees at organization of all sizes and in any industry, OKR's for All will also earn a place in the libraries of consultants and professionals who serve these firms.
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Veröffentlichungsjahr: 2022
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Table of Contents
Cover
Title Page
Copyright
Introduction
Why Now?
Creating Purpose‐Driven Work for Every Employee
Building Cathedrals with OKRs
Who Is This Book For?
How This Book Is Organized
Notes
PART I: OKR Foundations
CHAPTER 1: Core Concepts: What Are OKRs?
What Do OKRs Do?
OKR Basics: Objectives, Key Results, and Key Initiatives
How Objectives, Key Results, and Key Initiatives Fit Together
How OKRs Flow Through an Organization
CHAPTER 2: Why OKRs?
Using OKRs to Solve Modern Business Challenges
The Importance of Visibility and Alignment
Accelerate Business Growth
Notes
CHAPTER 3: The History and Evolution of OKRs
OKRs: A Timeline
OKR 1.0 “The Manual Era”
OKR 2.0 “OKR Software V1”
OKR 3.0 “Era of Connected Software”
The Future of OKRs
Notes
CHAPTER 4: OKR Misconceptions, Mistakes, and Myths
OKRs Are Only About Measurement
OKRs Are Only for Leadership
Common Misconception: OKRs Can Be Used Directly to Assess an Individual's Performance
OKR Is a Rigid, All or Nothing Methodology
OKRs Work Only for High‐Tech or High‐Growth Organizations
OKRs Are a System of Control for Teams
OKRs and KPIs Are Interchangeable
PART II: Applying OKR Principles
CHAPTER 5: Defining Your Objectives
Make Your Objectives Time‐Bound
Start with the “Why”
Objectives Should Create Focus
Objectives Should Inspire
Committed and Aspirational Objectives
Objectives Should Create Balance
What Does a Good Objective Statement Look Like?
CHAPTER 6: Defining Your Key Results
Key Results Should Create Clarity
Outcomes over Outputs
What Does a Good Key Result Look Like?
Committed and Aspirational Key Results
The Process of Defining Key Results
Perform the Necessary and Sufficient Test
CHAPTER 7: Defining Your Key Initiatives
Key Initiatives Should Create Context
Key Initiatives in Practice
CHAPTER 8: Aligning and Cascading Your OKRs
The Right Number of Levels
Choosing Your Cascading Method
Aligning Across Departments and Teams
Team Alignment
Cross‐Functional Alignment
CHAPTER 9: Writing OKRs: An Interactive Team Workshop
Pre‐Workshop Checklist
Workshop Timeline
CHAPTER 10: The Most Common Questions About OKRs (and Their Answers)
What If We Don't Reach 100% of Our Goals?
We Use Agile—Why Do We Need OKRs?
CHAPTER 11: Staying Focused and Tracking Progress
Scoring OKRs
Reporting and Asynchronous Communication
Asynchronous Communication and Dashboarding
Sharing Your Progress, Plan, and Problems
KPIs
Project Plan
CHAPTER 12: Wrapping Up and Reflecting on OKRs
Rules for Reflection
Note
CHAPTER 13: Company OKRs
What Are Good Company OKRs?
Annual Company‐Level OKR Examples
Quarterly Company‐Level OKR Examples
CHAPTER 14: OKRs for Each Department
The Strategy and Operations Team
The Product Team
The Human Resources Team
The Sales Team
The Marketing Team
The Customer Success Team
Notes
PART III: Running the Business with OKRs
CHAPTER 15: Expect and Prepare for a Challenge
OKR Rhythm Fundamentals: The Three Cs: Create, Check‐In, Close
CHAPTER 16: Key Business Rhythm: Annual Planning
Key Business Rhythm: One to Three Months Before the Start of Next Year
Key Business Rhythm: One Month Prior to the New Year
Key Business Rhythm: The First Week of the New Year
CHAPTER 17: Key Business Rhythm: Quarterly OKR Planning
End‐of‐Quarter OKR Scoring and Reflections
CHAPTER 18: Key Business Rhythm: Monthly OKR Reviews
CHAPTER 19: Key Business Rhythm: Weekly Team Meetings
CHAPTER 20: Key Business Rhythm: 1:1 Meetings
CHAPTER 21: FAQs for OKR Check‐Ins
PART IV: Getting Started with OKRs
CHAPTER 22: Key Roles in Getting Started with OKRs
Individual Employees
The Human Resources Leader
Optional Role: Admin/IT
CHAPTER 23: A Step‐by‐Step Guide to Getting Started with OKRs
Step 1: Getting Started with the OKR Maturity Model
Step 2: Understand the Phases of OKR Rollout
Step 3: Put Together Your Project Plan and Communication Plan
Step 4: Coach Your Group on Developing Great OKRs
Step 5: Integrate OKRs into Your Business Rhythms
Brainstorming Exercise: Assess Your Current Rhythm
Building Out Your OKR Rhythm
Conclusion
Optimism
Bias
Coordination Neglect
How Can You Get Around the Planning Fallacy?
Acknowledgments
About the Author
Index
End User License Agreement
List of Illustrations
Chapter 3
FIGURE 3.1 A simple history of OKRs.
Guide
Cover Page
Title Page
Copyright
Introduction
Table of Contents
Begin Reading
Conclusion
Acknowledgments
About the Author
Index
Wiley End User License Agreement
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“If you read just one book on OKRs, read this one.”
—Satya Nadella, Executive Chairman and CEO, Microsoft
OKRs FOR ALL
Making Objectives and Key Results Work for your Entire Organization
Vetri Vellore
Copyright © 2023 by Ally Technologies, Inc. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
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Library of Congress Cataloging‐in‐Publication Data:
Names: Vellore, Vetri, author.
Title: OKRs for all : making objectives and key results work for your entire organization / Vetri Vellore.
Description: Hoboken, New Jersey : Wiley, [2023] | Includes index.
Identifiers: LCCN 2022012508 (print) | LCCN 2022012509 (ebook) | ISBN 9781119811596 (cloth) | ISBN 9781119811626 (adobe pdf) | ISBN 9781119811602 (epub)
Subjects: LCSH: Management by objectives. | Strategic planning. | Goal setting in personnel management.
Classification: LCC HD30.65 .V45 2022 (print) | LCC HD30.65 (ebook) | DDC 658.4/012—dc23/eng/20220511
LC record available at https://lccn.loc.gov/2022012508
LC ebook record available at https://lccn.loc.gov/2022012509
Cover Design: Wiley
Introduction
There's a parable about three bricklayers that has always captured the importance of purpose‐driven work for me.
A man walking down the street sees three bricklayers. Each of them is diligently placing bricks along a wall, and each of them is working very hard.
To the first bricklayer, the man asks the question, “What are you doing?” The bricklayer replies, “I am laying bricks. I am working hard to feed my family.”
The man moves to the second bricklayer and asks the same question,“What are you doing?” to which the second bricklayer replies, “I’m building this nice, big wall.”
Finally, the man comes to the third bricklayer, who is the most focused, and asks again, “What are you doing?” The third one has a gleam in his eye and says, “I’m building a great cathedral.”
The fact is, most employees don't know why they're doing the work they do; they just work on what their manager tells them to or what some project management tool lists as the next task for them.
When every team and person in your organization is aligned to the strategic priorities of the business and understands the purpose behind their work, they are highly engaged, productive, and happy. It's true when building cathedrals, and it's true in business.
Businesses today face constant disruption and uncertainty—whether due to technical disruptions, market changes, financial conditions, war, or pandemics upending whole industries. These businesses need a new framework to move the business forward, pivot when necessary, and empower their teams.
When teams understand the “why” of a company's objectives, they intuitively recognize concepts and plans more concretely, and will be able to flag risks, changes needed, and opportunities that may have been missed otherwise.
By focusing on what matters in the midst of the daily whirlwind of activity, your teams stay in the “flow” and are highly productive. Purpose and alignment bring your teams together and foster collaboration.
The leadership challenge is how to bring purpose to the work everyone is doing, so everyone in the organization understands that they are building a cathedral and not just coming to work every day to lay bricks one at a time.
I've seen thousands of businesses drive alignment, purpose, and focus and increase business resilience and growth by leveraging the goal methodology of objectives and key results (OKRs). In the following pages, you'll learn how this can be accomplished for you and your business as well.
Why Now?
In March of 2020, COVID‐19 tore across the globe and upended life as we knew it. Like most business leaders, I closed my company's office and sent the team to work from home, unsure of when we'd come back or what the pandemic meant for our business's future (at least those of us fortunate enough to work in industries where we could do so). At the time, we hoped it would be only a few weeks. Then, a few weeks turned into our new normal. Our entire way of working changed.
While the shift to hybrid and remote work appears to have happened in blink of an eye, the shift has been underway for years. Over the past decade, more and more employees have opted for flexible work arrangements and work hours, and more and more employers have started to embrace this change. Business leaders have been under steadily growing pressure to show success faster and, as our teams move to distributed models, the old systems that worked in‐office are creating bottlenecks and leading to a lack of alignment. Talent has become harder to attract and retain than ever. COVID‐19 exacerbated these changes, but it did so more quickly than any of us could have imagined.
Businesses are under ever‐increasing pressure to quickly adapt to these shifts, while continuing to keep every employee focused, motivated, and driving business outcomes.
I'm excited to share how OKRs can add value to every single employee in your organization and accelerate the business.
My company, Ally.io, which has since been acquired by Microsoft, builds OKR software. This framework has been central to how we operate our business, providing the foundation for every discussion and initiative. In March of 2020, as we all scrambled to make sense of the external factors changing our lives, OKRs helped ground the entire team to our most important work and, more importantly, to the outcomes we needed to drive.
More important than my own experience in using OKRs to grow multiple businesses, my team and I have helped thousands of teams do the same, using OKRs and our software. From large enterprises to startups, technology to manufacturing, media to healthcare, and operations and HR to engineering and sales, I have seen OKRs make an impact in every type of business and function.
Throughout this most recent period of change, and others before it, the OKR framework has been the key to resilience for so many businesses, mine included. It has given us the ability to continue to scale as we moved out of the initial system shock and into the new normal.
Most industries have moved to a global, distributed, and sometimes asynchronous workforce. This phenomenon, coupled with a growing tech stack to accommodate it and increased urgency around the pace of innovation and growth, has led to the need for visibility, alignment, and employee engagement across businesses that are becoming more and more complex.
Our businesses are dealing with an urgent need for speed and agility at scale. All while the increase in remote and distributed work has brought new challenges including the impact this hybrid environment has had on our personal lives. Four key themes have emerged more prominently in this hybrid world:
A lack of alignment is creating bottlenecks:
In many cases, managers and teams aren't aware of what other departments are working on, whether they're focused on the same initiatives, or whether their own group is working on the right initiatives or driving toward the right outcomes. This lack of structure is exacerbated by processes that often rely on a single person or single point of failure. Without the alignment needed to move quickly and in synch, the business can slow to a crawl, create customer‐facing problems, or have teams doing duplicate work.
The need for growth and resilience are more daunting than ever:
Almost half (48%) of executives say that the biggest risk to their business achieving its growth targets.
1
The expectations investors and shareholders have for exponential growth are higher than ever, and the competitive landscape is exploding, regardless of industry or vertical. In fact, 2021 ended with over 832 “unicorn” companies (privately held businesses valued at over $1 billion).
2
In 2015, unicorns numbered fewer than 80. This pressure falls squarely on the shoulders of the leadership team. In 2021, we saw record CEO turnover, nearly double that of 2018.
3
The Great Resignation:
Employees are leaving their jobs en masse because they are not connected to the company's purpose. In short, they do not feel like their work matters, and role switching takes less of an emotional toll when they don't find that connection around a proverbial water cooler. According to a 2022 Microsoft Worklab report,
4
43% of the global workforce is considering a job change. Employees aren't connecting face‐to‐face like they used to. There's no break room, no ping‐pong table, no coffeepot to stand around and gossip. Company culture in 2022 comes from a sense of purpose. Employees want to feel connected to the company's mission and vision, they want to know that they're doing work that contributes to that mission, and they want to trust that the work they're doing is the
right
work.
Visibility is more difficult, and silos have emerged:
As a business leader, you need line‐of‐sight into the focus areas and work being done across the company and the ability to click deeper to understand a trend, growth opportunity, or risk to the business. On the other side of that coin, your employees need to experience transparency from you that is not as natural as it may have been in‐office. Future Forum finds that employees who feel like their leadership team is transparent are twice as likely to feel confident about their company's future.
5
In the end, it all comes down to a relentless focus on that purpose and making it central to every part of the business.
Creating Purpose‐Driven Work for Every Employee
Perhaps my favorite part of the bricklayer parable is that it's rooted in the true story of the famous architect Christopher Wren, who was commissioned to rebuild St. Paul's Cathedral after the great London fire of 1666. Wren understood that truly executing on something amazing takes everyone working toward the same vision and took it upon himself to ensure that the people working on St. Paul's understood that vision.
This is where two critical challenges come into play when thinking about business execution and translating strategy into actual productivity:
Many leaders assume their team automatically has the context of what they're building, and automatically sees why their work matters or fits into the overall mission. That context is actually lost quickly when you traverse different levels of the organization. In fact, the consulting firm McKinsey recently asked this question, and found that while 85% of executives and upper management said that they feel connected to purpose at work, only 15% of frontline managers and frontline employees agreed. Worse, nearly half of these employees disagreed, compared with fewer executives and upper management.
6
Too often, organizations and leadership have convinced employees that they are the bricklayers. Employees don't feel empowered to engage in conversations about the broader purpose and believe that they aren't entitled to that context. This has a detrimental effect on productivity. That same McKinsey study found that managers and employees who didn't feel that connection to purpose saw significantly lower outcomes (both at work and in their personal lives) than those who did.
Building Cathedrals with OKRs
OKRs help every employee see the cathedrals they are building with each brick they lay. And, just as importantly, they help leaders determine where more focus is needed, which resources are best suited for which job, and how to move quickly without sacrificing quality.
My team and I have worked with thousands of business leaders from Fortune 500 companies to startups, and every department from engineering and product development to sales, marketing, operations, and HR, to implement and operationalize successful OKR programs. This is not an easy thing to do. The OKR framework is simple to conceptualize, and the results can be incredible, but, like any organizational transformation, is not easy and it takes work to make it stick.
Throughout this book, I'll share anecdotes from a variety of these OKR‐driven companies across different industries, highlighting the success they've found, obstacles they've overcome, and tips for the next generation of OKR practitioners.
After thousands of interactions, the one thing that has been proven true time and time again is that a business’s biggest and most ambitious goals are more achievable when every employee understands them, understands their influence on them, and their ability to make an impact. OKRs create alignment and shared purpose throughout the entire organization. The VP of operations for a fast‐growing and well‐known software company recently told me, “The more employees we have using OKRs, the better we've become as a business.”
Once an organization masters using OKRs correctly, this framework can increase executional velocity and resilience, and drive productivity and engagement across the organization. It will create a cultural shift in the way work is done and make OKRs the steel thread that runs between that work and the company's biggest objectives.
The OKR methodology is a monumentally powerful tool for aligning an organization, but for decades, it's often been misunderstood, and not applied in a way that productively serves the organization, leaving many employees out of the mix. This diminishes the benefit OKRs bring to their organization, thwarting progress and agility.
OKRs have helped thousands of the most successful companies in the world execute and stay ahead of the game for over 50 years. The goal methodology provides focus, accountability, clarity, and purpose, and leaders have embraced their simplicity and structure like no other framework. They can do the same for you and your team, driving growth, alignment, and flexibility at a time you can't afford to live without it.
Who Is This Book For?
If you're a business leader focused on business growth and resilience, and developing a mission‐driven, highly engaged workforce, this book is for you. You will learn the key OKR concepts, how to use them effectively in shaping the culture of your organization and driving business outcomes, and practical guidance on how to get the most out of using OKRs.
For department and team leaders focused on ensuring that your team is aligned to the strategic priorities of the company and is engaged and productive, this book will help you learn OKR concepts and provide practical tips on how to use OKRs to drive team engagement and productivity.
For those in human resources/people operations, you will learn how OKRs relate to your HR processes and provide guidance on how to use OKRs help every employee in your organization to know that their work matters and be highly engaged.
For those enthusiastic or merely curious about OKRs, my hope is that you learn the concepts and enable you to drive OKR initiatives for your team or organization to have an outsized impact.
OKRs are about aligning the entire company to a common purpose, and that takes each person understanding what that purpose is and how to bring it to life.
How This Book Is Organized
In the following pages, I'll show you how to make OKRs work for everyone in your organization. Throughout this book, I'll address not only how to leverage OKRs for success, but how to avoid the pitfalls so many have run into.
In this four‐part book, you'll find guidance, anecdotes, examples, and frameworks that address the common themes, questions, challenges, and successes we've seen from working with thousands of businesses:
Part I
:
In OKR Foundations, I’ll share the basic fundamentals of what OKRs are and how they’re structured, and we’ll discuss why they’ve worked, and in some cases, why they haven’t.
Part II
:
In Applying OKR Principles, you’ll learn the tactical application of OKRs, starting with defining meaningful objectives, capturing the relevant key results and key initiatives, and then how to align and cascade OKRs throughout your organization.
Part III
:
In Running the Business with OKRs, we’ll define the core business rhythms that need to be updated to ensure OKR success.
Part IV
:
In Getting Started with OKRs, armed with the framework and the knowledge of the cadence you’ll need to operationalize, I’ll share how to build your plan and various mechanisms, and how to ensure that the program doesn’t fall flat after the first cycle or two.
Throughout, I'll share both data and stories of how successful companies around the world have used OKRs to transform the way they run their business.
This book will be your practical guide to OKRs, creating a culture that is purpose‐driven, providing tools for your managers and teams, and giving you the framework to drive not only a successful OKR program but a successful, thriving, and resilient business.
Notes
1
PWC Pulse Survey, 2022
https://www.pwc.com/us/en/library/pulse-survey/executive-views-2022.html
.
2
Nicholas Rapp and Jessica Mathews, “Is the ‘Unicorn’ Boom Turning into a Bubble?”
Fortune
, October 10, 2021,
https://fortune.com/longform/unicorn-boom-bubble-pre-ipo-startups-data-map/
.
3
PwC, “CEO Turnover at Record High; Successors Following Long Serving CEOs Struggling According to PwC's Strategy& Global Study,” PwC press release, 2019,
https://www.pwc.com/gx/en/news-room/press-releases/2019/ceo-turnover-record-high.html
.
4
“Great Expectations: Making Hybrid Work
Work
,” Microsoft Annual Work Trend Index Report, 2022,
https://www.microsoft.com/en-us/worklab/work-trend-index
.
5
“The Great Executive–Employee Disconnect,” Future Forum by Slack, October 2021,
https://futureforum.com/wp-content/uploads/2021/10/Future-Forum-Pulse-Report-October-2021.pdf
.
6
Naina Dhingra, Andrew Samo, Bill Schaninger, and Matt Schrimper, “Help Your Employees Find Purpose—Or Watch Them Leave,” McKinsey & Company, April 5, 2021,
https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/help-your-employees-find-purpose-or-watch-them-leave#:~:text=Whereas%2085%20percent%20of%20execs,upper%20management%20(Exhibit%202
).
PART IOKR Foundations
In this first part of the book, I will cover the basics of OKRs, including core concepts and structure so that you have a good understanding of the OKR framework.
My personal OKR for this book is:
Objective (Goal): Provide the best practical guide to OKRs relevant to every person in an organization.
I will measure the success of this objective using the following key results.
1:
Enable OKR adoption for 1M teams.
2:
Earn 4.9 rating for “usefulness” on Amazon.
3:
Make 100% of OKR rollouts successful.
I will reach the above outcomes by doing the following key initiatives:
1:
Sign with a reputable publisher.
2:
Write a practical manuscript.
3:
Earn endorsements from other OKR experts.
This framework may seem unfamiliar to you now, but it won't by the end of the next chapter on “Core Concepts,” where I will walk you through the OKR fundamentals in detail. Let's dive in.
CHAPTER 1Core Concepts: What Are OKRs?
In this chapter, I will provide a breakdown of what OKRs are, and how successful businesses use them to address the challenges of visibility and alignment, the need to drive results faster, and improve employee engagement.
What Do OKRs Do?
OKR is a proven goal‐setting framework for creating alignment and focus and building a highly productive and engaged work culture to drive your business outcomes.
OKRs align your entire organization to strategy, shifting focus from output—the everyday work of your team—to outcomes, which are the impact of that work. This mindset shift keeps your team highly engaged with a clear sense of purpose and understanding of how everyone is contributing to forward momentum.
OKRs sit at the intersection between purpose and strategy and execution.
Your mission is the light at the top of your lighthouse, guiding everything you do, closely tied to your values and culture. These make up your organization's purpose.
For instance, if you are a gaming company, your mission (why your business exists) might be “To educate every child using games.” Your vision (picture of the future) might be “To make every game an educational game.” Your values and culture would reflect this by favoring values like “Educate at every touchpoint” and “Learn every day.”
Your strategic priorities, objectives, and key results make up the strategic direction for your organization—they are the outcomes that your organization is hoping to achieve. Your strategic priorities are your go‐forward strategy, and your objectives and key results are the connective tissue how you drive the organization to realize your strategic priorities.
Let's go back to our gaming company example, and let's say you are working on a new game. At the company level, your objective isn't to release a new game—it might be to make money for your shareholders. As a business, you may also (and should) have objectives around social impact and doing good in the world, but for the sake of simplicity, let's stick to the revenue objective for now. The projects and key initiatives your engineering team are working on to complete the new game are your output.
Your organization's output is obviously necessary and usually visible, because most employees spend their time in this execution‐level work. But the projects and key initiatives itself isn't the desired outcome. It's what you're doing to get to your revenue outcome. This seemingly simple shift in thinking from outputs to outcomes unlocks huge value for an organization.
By pointing your entire team toward outcomes, you enable everyone in the organization to focus on business outcomes instead of projects and activity, empower them to prioritize, and figure out the best ways to get those outcomes. This book gives you an operating manual for getting started with OKRs, the connective tissue between the strategic priorities and everyday work of your team.
OKR Basics: Objectives, Key Results, and Key Initiatives
You can think about objectives, key results, and key initiatives in the following way:
The formula for writing an OKR is:
An objective is directional. Whether at the company, department, or team level, an objective is where you are headed—your target.
Key results are measurable outcomes that signal that you are moving in the right direction toward your objectives.
Key initiatives are the actions your team takes to move key results in the right direction.
Objective: Goals You Want to Accomplish in a Set Period of Time
Choose three to five objectives at the most.
This helps you bring focus to your team at every level, from the company‐wide OKRs that your leadership puts together to the individual OKRs that your team members put together. Having to pare down all the things you want to accomplish to a list of three to five objectives helps avoid goals from turning into task lists. If you prioritize everything, you prioritize nothing.
Keep in mind here that you want a mix of objectives that you know you can achieve and ones that you know will be a stretch for you and your organization. This helps create the environment of innovation and creative thinking that OKRs are known for facilitating.
Seek simplicity.
Each objective should be clear and concise. This ensures that, as OKRs are made visible throughout your organization, everyone—not just leadership—is able to understand what you are trying to achieve.
Ask yourself:
What do you want your organization to accomplish?
Key Results: Expected Outcomes of the Objective
Be specific.
Results should be clear, measurable, and not open to subjective interpretation. Use specific numbers and metrics. Binary outcomes, like something got done or not, are not the best—but can be used.
Choose three to five key results for each objective.
Too many key results can lead to a lack of focus. OKRs are about providing a spotlight on the most important outcomes, not a floodlight on every outcome. To focus your key results, ask yourself, “Which metrics will
really
show me that I have achieved what I set out to achieve?”
Ask yourself:
Does each key result have a clear owner who is accountable for its success? Who do other stakeholders go to when this key result is behind?
Key Initiatives and Projects: These are activities that will be done to achieve the key results.
Stay
realistically
optimistic.
Make sure you have the ability (the resources and timeline) to execute the projects and key initiatives under your OKRs. That's what makes an objective realistically optimistic, and not a pipe dream.
Ask yourself:
What could get in the way of our projects and key initiatives?
Key initiatives are often delegated, and when they are delegated, they can become the objectives or projects of someone else.
This ensures alignment between company‐wide OKRs and the work prioritized by every department in your organization. More on this in
Part II
.
How Objectives, Key Results, and Key Initiatives Fit Together
To explain how objectives, key results, and key initiatives interact with one another, I'm going to use an example.
Let's return to our video game company, and let's say your aspirations are to take over the North American video gaming market. Your objective look like this:
Objective:
Become the best gaming platform in North America.
But what does “best” mean? It is first important to clarify what it means to become the best gaming platform in North America, as that could mean different things for different people in the organization. Is becoming the best gaming platform in North America defined by revenue, popularity, users, or something entirely different? You need to be able to objectively measure your outcomes so there is a common, clear understanding across the organization of what you are aiming for, not just what you are doing to get there.
So we add in key results, which explain what “best” actually looks like in terms of results.
Objective:
Become the best gaming platform in North America.
Key Result:
Achieve 150 million monthly active users.
Key Result:
Exceed 90% user retention.
But how will this gaming platform get to the key results that represent success?
This is where we layer in key initiatives, which are the “how” we get to our key results.
Here is the same OKR written with key initiatives in the picture:
Objective:
Become the best gaming platform in North America.
Key Result:
Achieve 150 million monthly active users.
Key Result:
Exceed 90% user retention.
Key Initiative:
Ship new version of gaming platform by 6/1 to improve engagement.
Key Initiative:
Increase reach of our gaming platform by 10 million new users.
These key initiatives are the work the company needs to do in order to maximize the chance of achieving these key results, and, ultimately, objective. In many cases, these key initiatives need to be tracked and monitored just as closely as the key results.
Your key initiatives and projects are the executional outputs delivered by your team to reach an objective, whereas key results are outcomes that help you measure your progress toward that objective.
Key initiatives and projects are “how you get there,” but in differentiated ways.
Key initiatives
begin at the company level, beneath objectives and key results. Key initiatives can become objectives for the next level down, the department level. Then the department level's key initiatives become the objectives at the team level. More on this structure, including a visualization, in the next section.
Projects
operate at the team and individual level. They are the execution‐level, tactical work that needs to get done to achieve all the objectives that come before them.
By bringing key results, key initiatives, and projects together with objectives at the company, department, and team levels, everyone in your organization should have clarity on where they are headed and how they are going to get there.
How OKRs Flow Through an Organization
The ideal state is to have OKRs flow from the business level to departments, teams, and all the way to individuals to enable and align each level to the business priorities.
