Objectives & Key Results - Increasing Productivity

 John Doerr's 'Measure What Matters' is a book about OKR's, or Objectives & Key Results. OKR's is a system of goal setting, originally developed by Andy Grove of Intel in the late 1960's, and has since adopted by many of the organizations that have not only become household names, but that have managed to remain agile and survive through tumultuous times, such as the dot-com bubble, and the 2008 recession - Google, Amazon, GoPro, LinkedIn, Microsoft, Rackspace, Dell, VMware, and more.

So, what is the OKR system of goal setting? OKR stands for Objectives & Key Results. Objective is the what is to be accomplished, a clear, concrete and action oriented statement; the Key Results are the how to get there, in measurable and verifiable benchmarks.

To help illustrate how this works, lets look at an example from the book that demonstrates some good use of OKRs, and some poor ones:

The left-hand side is an illustration of a well formed, cascaded OKR system. The key result for the GM becomes the objective for the Head Coach, who then defines his/her objectives using measurable metrics, which are further cascaded to the Offensive, Defensive, and Special Teams coach.

The right-hand side is an illustration of OKR that are not well formed. The key results for the SVP of marketing are vague - what does 'upgrade team branding' mean? What does it mean to 'improve media coverage?' It's very subjective, and there are no numbers or measurable values to judge progress. If things where rephrased where 'upgrade team branding' turned into something like 'improve brand recognition through surveys by 30%', or 'improve media coverage' turned into 'increase media exposure by 20%', that would be a true measurable value.

Also, the top level objective, to make money for the owner, is another example of a poorly constructed objective. Yes, all businesses exist to make money, but the top objective of making a single person money doesn't engender good will among employees.

Another key aspect of the OKR system is transparency - each person or group knows the OKRs that another person or group is working on. This reduces silo'd work efforts, and holds the organization, as a whole, accountable to the goals that were set out to be achieved. Additionally, if a group or person is falling behind in achieving their Key Results, transparency allows others to potentially pitch in and assist, if necessary.

If implemented properly, the OKR system results in:

• Everyone knowing what the overall objective for the organization is.
• Everyone having a clear vision of how their personal OKRs fit into the overall picture.
• A true team-based culture where people feel invested in their work, and work together to achieve a common goal.

The OKR system provides a model for goal-setting where a well formulated mission statement leaves off - it makes sure everyone in the organization is invested, and pulling, in the same direction.