Developing and implementing objectives and key results (OKRs) is by no means a new concept. OKRs have been around since the 1970s. But it was Google’s adoption of OKRs that popularized them, making them a standard practice implemented by today’s startups, SMBs and enterprises.
Getting OKRs right isn’t easy though. It takes practice. It takes lots of practice. That’s one of the reasons why we at Range get so many questions about how to do OKRs the right way. Most of us know how impactful setting the right goals and objectives can be for our business, but we don’t all know exactly how to go about getting started. That’s why we decided to focus our third mini-conference on building alignment through goals and OKRs.
We brought in a number of experts to help guide the conversation, including Rick Klau, Senior Operating Partner, GV; Christina Wodtke, author of Radical Focus and lecturer at Stanford University; Mike Wu, former CTO, VSCO and Head of Engineering, Seesaw; and Andrew Beebe, Managing Director, Obvious Ventures.
Here are the lessons we learned.
If you don’t check in on your progress and try to understand what’s happening after you set a goal, then you’re totally missing the point of OKRs. That’s why it’s so important you identify what you want to learn from them. How will the results of your work help you determine what comes next?
As panelist Mike Wu said when asked about the intent behind OKRs, “As a company, as a business, as entrepreneurs, we need to be focused on the outcomes we want, what we can learn, and what changes we can make to succeed.”
At their highest level, OKRs represent your company’s focus, not the totality of work. OKRs are a guide used by teams to direct effort and work. When team members can see the goals and key results they should be shooting for, they can be more creative about how they go about achieving results.
“In companies that don't have goals, it can be hard for individuals to feel empowered to contribute autonomously." —Jennifer Dennard
When you miss an OKR, hold yourself and your team accountable. Address when this happens, uncover what can be learned, consider whether or not you set the right objective, and then work to achieve the clarity you need to achieve success in the next cycle.
There are many different methods for setting OKRs. Do what makes the most sense for you and your team. But remember to make room at the table for the people who have the knowledge and experience you need. While leadership will set your strategy, there are individual contributors (ICs) with execution experience who will often be best-equipped to identify what needs to be done and how to get there.
If you’re just starting out with setting goals and OKRs and are unsure what might be the right objective to pursue, create a hypothesis OKR. Write down something you think might be true, set key results that will help you validate that hypothesis, and give yourself a limited amount of time to prove or disprove it.
If you’re at an early-stage company where you haven’t yet found product-market fit, I recommend creating hypothesis OKRs. Write something you think might be true, set key results that will indicate if it’s true, and give it 6-12 weeks to prove or disprove. —Christina Wodtke
When setting goals, focus on retention first. Work on improving conversion once you see people sticking around. Then focus on acquisition. By working through objectives in this order you ensure that you’re not pouring water into a leaky funnel. However, keep in mind that you may need to do some work on acquisition and conversion first. This is a loop that you will need to continuously work through from quarter to quarter or cycle to cycle.
OKRs help teams reach alignment on what they’re doing and what they’re not doing. If you’re worried about the work that doesn’t fit into OKRs, you can set benchmarks or “red zones” where the team will switch to that work if a metric enters a certain zone; e.g., number of bug reports, customer Net Promoter Score (NPS), etc.
We’ve talked about why individual OKRs don’t work before. They’re redundant and overly precise. They cause employees to put their personal objectives above those of the company, they introduce unnecessary complexity, and they reduce employee autonomy. Too often, individual OKRs end up becoming a formula for performance reviews, and that is not their intended purpose.
It can’t be said enough: OKRs are all about learning. That’s why reflecting on progress at the end of a quarter or cycle is so important. Going through a retrospective, which includes grading your OKRs, will help you and your team improve how you write your goals and objectives, how you identify the best metrics with which to measure key results, and it provides the clarity necessary to build and empower a team of focused individuals.
Thank you to everyone who attended our mini-conference and to Bloomberg Beta for hosting us again. To learn more about future events, sign up for our newsletter or follow us on Twitter.