Once Upon a Time, someone, perhaps Andy Grove, perhaps Peter Drucker, came up with a very simple idea. What if we told people what result we wanted and trusted them to figure out how to make that result happen.
They called it managing by objectives. The big idea was telling employees, “we’d like to improve engagement.” Or “we’d like to make the business successful by becoming the number one name in processors” or “we’d like to make the world’s information findable and usable.” And then trusting the employees to figure out how to make those numbers move.
And then someone else figured out a good way to format the goals, a lot like SMART goals. Let’s unite the company by having a visionary objective and clear measurable results. With good OKRs, we (the execs) can make sure everyone understands what we need them to do.
This took a big change of thinking in management. Instead of telling people what to do, you had to figure out how to tell them what you wanted to see happen in the future. But this was amazingly powerful because suddenly if you hired really smart people who hated it when you micromanage them, you could take advantage of all that smartness and point them all in the same direction. It is a big reason Google adopted OKRs. They are famous for their intense hiring practices. As well, managing engineers is like herding cats. Instead of herding cats, put out catfood, which in this example means give smart engineers hard and inspiring goals and watch what happens next!
OKRs are also awesome because everyone needs to sleep, even CEOs. And if you’re trying to tell everybody what to do, and your company gets to any decent size, you’re going to fail and probably have a nervous breakdown along the way.
But then that very simple system, OKRs, was picked up by consultants who wanted to make their clients happy. And when a client wanted to make one of the key results into delivery of a project, the consultants just smiled and nodded because they wanted to get hired again.
And a bunch of people wanted to make software, but it’s really hard to make software around results (pro tip, make it a dashboard!) So some of them made project management software that tracked what people were doing as opposed to the results they were creating.
That meant the software manufacturers and consultants had to water down the idea of OKRs. These consultants and software folks wrote articles and books and didn’t want to offend anybody and wanted to make money.
They put out bad examples of OKRs like
“O Recruit three new players.
KR1 Attend 25 games to scout out potential recruits.
KR2 Approach 30 players throughout these games.
KR3 Contact the agents of 10 potential recruits.”
Why are these terrible? Because you could do all these activities and still fail the real objectives: to have a badass team. As well, how micromanagey is this? Attend 25 games? Why not 20? why not 50? If you go to 25 but don’t find anyone good, do you stop?
What if it was
Objective: Recruit at least three world-class players
KR1: New Hires have a goal history of x
KR2: New Hires have a passing / blocking/defence history of Y (is in why sports metaphors? I suck at them. But I know results when I see them.)
KR3: New Hires have a reputation of improving any team they are on, validated by 6 references.
Or you could think one layer deeper and do, say,
Objective: Team has the players to be successful
KR: X% of players have a goal history of Y
KR: X% of players are tweeted/FB’d about Y times a week (pack those stands with fans!)
KR: X% of games are won by Y margin
I don’t know sports, but I’m going to make a bold claim that most sportsball team owners want their players to win games, or at least have teams that are interesting enough to sell tickets. Once you dig down and find the real goal, you can make better choices about what the goals you message to your employees are.
Anyhow, flash forward to a few years of consultants and OKR software companies putting out bad examples and suddenly companies were trying to use OKRs to do crazy things like manage all the activities in the company! They were trying to use okrs for performance management and for project management and a bunch of stuff that okrs were never made to do.
Ed Batista writes, Goals are prescription medicine, not nurishment.
The New York Times’ Alina Tugend recently asked a number of researchers to reflect on the benefits and disadvantages of goals. One of Tugend’s sources, University of Arizona professor Lisa Ordóñez has co-authored a paper that highlights the potency of goals’ influence as well as their undesirable side effects:
The beneficial effects of goal setting have been overstated and…systematic harm caused by goal setting has been largely ignored. We identify specific side effects associated with goal setting, including…distorted risk preferences, a rise in unethical behavior, inhibited learning, corrosion of organizational culture, and reduced intrinsic motivation. Rather than dispensing goal setting as a benign, over-the-counter treatment for motivation, managers and scholars need to conceptualize goal setting as a prescription-strength medication that requires careful dosing, consideration of harmful side effects, and close supervision.
So when people hoped to use OKRs to make big changes their companies needed, and were told to slather OKRs all over everything, those people were frustrated and upset with their experience. Even worse, people were working so hard to try to shoehorn a methodology into doing something it was never designed to do that they didn’t have time to focus on the numbers that told them whether or not their company was succeeding. The process had become more important than the results.
And if those people being sold some OKR snake oil were smart, they asked important questions like, is this really different than tracking things in Trello? Don’t we have project managers for this? Maybe we should just get management training for our managers so they know how to do performance reviews?
And if they were really really smart, they asked themselves, “what’s a big deal about OKRs” and what makes him so successful? And that would have taken them back to the original idea.
Back to Basics
What are OKRs? It is a goal setting methodology that focuses on outcomes, empowering teams so they can figure out how to make the business successful. Anything else is not OKRs. Anything else is project management wine in OKR bottles. It’s OKR theater.
I’ll be perfectly honest. If I never got hired for an OKR job again I would be completely happy. I have a lot of interests, including creating empowered teams and how to teach game design. I wrote Radical Focus because I thought okrs were pretty nifty. I’d love it if you bought my book, of course, but I’ll tell you a secret: almost all of it is on my blog.
OKRs have transformed my life. And they have transformed companies that I’ve worked with. It’s really hard to stay focused on the results you want when everybody is asking you if you’ve made progress on the projects you’ve committed to. But if you always focus on results, you are freed up to change your mind about what to do when you get new information. If you commit to a project you’re stuck with a project. But if you commit to a result you have flexibility to adjust as you get new information.
We live in an incredibly complicated world in which we’re always getting new information. The freedom to stay nimble and focus on impact can be the difference between success and failure.
OKRs are part of a larger management philosophy that includes things like Agile and Lean.
OKRs exist to protect incredibly important strategic initiatives that might get bumped in the everyday activity of life. Which means we have to recognize there is an everyday activity of life.
There are metric reviews. There are maintenance efforts. There’s branding and marketing and sales and they all matter. Every company does so many things, and different companies need different approaches. OKRs sit on top of all the rest of business activities, acting to keep critical strategic efforts front and center. NOT EVERYTHING, NOT EVERYONE, NEEDS OKRS.
I wonder why OKRs devolved into project management. Maybe it’s because a lot of folks are solution oriented, and it’s hard to focus on results and not fall in love with the solution.
I wonder if OKRs become task management because some people think management means telling people what to do.
Maybe it’s because some people are scared letting go might mean it gets done badly. Or maybe afraid it might get done well.
Maybe it’s because some managers/CEOs are control freaks. Maybe some people think they are the only one who knows the right thing to do?
But if you tell people what to do without telling them what the results you want are, people often do it wrongly because they don’t understand what they are doing.
And then the boss thinks, clearly I need to watch more closely! when the opposite is true.
Hire well and let go.
I should include some resources.
On OKRs eleganthack.com/the-art-of-the…
On outcome based results eleganthack.com/why-key-result…
And if you want to know how to handle all those other things (including hiring well), read The Team that Managed Itself https://amzn.to/2UgB7WM
This was written when I was in Belize.
Objective: chill today
KR: doggo and I sleep well tonight
KR: zero sunburn
KR: cheeks hurt from smiling
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