BetterWorks held its first Goal Summit last week. Kris Duggan, BetterWorks CEO, opened up the event by proposing
a goal system that is more open, measurable, and frequently updated. Duggan
explained how making everyone’s goals visible to everyone in the organization
can reduce politics and silo effects at work.
I left the summit
even more convinced that Betterworks is ushering in a new era of goal setting
and collaboration that will drive better execution. Donald Sull, who gave
one of the two presentations I will be discussing in this series of articles,
refers to this new era as "Goals 3.0".
This first post features key takeaways from John Doerr on Objectives and Key Results (OKRs). His talk was titled: “Why Goals Matter: A
Fireside Chat with John Doerr. John's thoughts on why your company needs to
implement a goal setting process right now, and common pitfalls he sees when
it's not done right.”
Doerr explained how he introduced OKRs at Google. He explained
that each organization must tune the OKRs model and adapt it to their culture. I now see that organizations have the ability to adapt their use of OKRs to shape
their culture. John provided several core components of the OKRs
model including:
·
Everyone does them (individual contributors, not
just team leaders)
·
There’s a regular cadence (Intel did them
monthly; Google does it quarterly)
·
Include the stuff that matters most (No need to put
everything you do into an OKR)
·
Goal system should be separate from compensation
(Prevent gaming the system)
As for the quantity of OKRs, Doerr suggested 5-7 Objectives
with 4-5 Key Result each.
These numbers seemed a bit higher than the original guideline from Doerr’s Basic Hygiene slide as presented in the 1990s to Google: “Maximum 5 objectives with 4 key results.” I was pleased to see the increase given
that my work with OKRs suggests that making goals more granular can make them
more actionable (See How Many
OKRs Should You Really Have?)
Doerr noted that until BetterWorks, OKRs were often tracked in
WIKI, Excel, or some other general productivity tool which made OKRs a disaster
to track across the organization. Doerr's positioning of BetterWorks as defining a new era where tools will
be available to support OKRs is spot on. I could not find such a tool after
helping a mid-size software company get started with OKRs even in 2013! John expanded on this basic hygiene slide during his talk with Kris:
OKRs are used on a
rhythmic basis.
Intel set new OKRs each month and that was right for their culture. Although the default is to reset OKRs each quarter, some are now updating OKRs every 6 weeks. OKRs can also
be done on an annual basis in parallel to a more frequent cadence.
OKRs are more
than a declaration.
They are used to check progress and can even become the
language used in staff meetings. For example, if a discussion leads to
something really important, a manager might say “this should be a key result.”
OKRs gives you clarity with the intellectual discipline of measurement. It
takes time as you develop goal setting muscles. Over the course of several
quarters, you and your team get better.
OKRs can but need not be graded.
Doerr also updated the OKRs community on best practices for
grading OKRs. Google apparently started as done, not done, or half-done, but
evolved their own 0-1 scale with decimal-level resolution. Some rate OKRs with
traffic lights. Duggan and Doerr also suggested that organizations beginning to
implement OKRs should consider layering in grading after several quarters. Simply
defining measurable goals and making them visible can be a major cultural
change so layer in the grading when the organization is ready.
OKRs need not be "tightly coupled."
A special thank you to John Doerr for clarifying the extent
to which OKRs are cascaded through an organization. Doerr noted, “OKRs need not
be hierarchically coupled.” In Doerr’s famous Football example OKRs are tightly
coupled. Google does not have such a tightly coupled system. Larry and Sergey
state the company OKRs, inspiring other teams to create their OKRs.
The company OKRs roughly inform other OKRs. There is no formal cascading
process requiring every OKR to be specifically tied to another. OKRs exist as an
open, social contract.
OKRs can define your culture.
Doerr explained how OKRs can be adapted to reflect and even
define a company’s culture. Google feels like OKRs are part of their DNA. Doerr
shared a story of how CEO of Lotus, recall Lotus 123, adopted OKRs and created “NOKRs.”
The "N" stands for "Not." Lotus used NOKRs to specify what they would not do: “Lotus should not do hardware.” Thanks
John! I may try NOKRs with one of my clients who are really looking to improve focus.
OKRs can help you raise money.
Doerr is a great story teller. He described how a
company he visited posted their OKRs over a urinal in the men’s room. I
left the presentation with a strong message that transparency and visibility of
OKRs can set the stage for great things. And, if you’re a start-up, you may
want to consider OKRs, as Doerr left us all with the message that “a good way
to get me to invest is to already adopt OKRs.”
More on Goal Summit 2015!
The next will feature Donald Sull, Professor at MIT, describing how we got from Goals 1.0 to Goals 3.0. His talk was titled: “Goals
3.0: Harnessing the Power of Social to Get Work Done: MIT researcher and
management expert Donald Sull discusses the effects of technology on the
evolution of MBOs and goal-setting." I expect videos of all presentations will be available shortly. For more on the Goal Summit, you may be interested in Brett Knowles's summary of a couple other presentations.
To learn more about OKRs and how you can get started, please request a free coaching session.
