In collaboration with NEO Culture, Mind the Product conducted a short survey on OKRs investigating their use in product teams in real companies. Now, the results are in.
In this post, we’ll provide an overview of the survey results and, if you’re a Mind the Product member you can access an extended report including analysis of all the areas covered below and a recording of our #mtpcon Digital OKRs panel – go to the extended report.
How Real Companies Implement OKRs
The results of our survey suggest that OKRs are still relatively new with almost 80% of participants telling us that their companies have been using OKRs for less than one year.
Taking Your Time Reaps Rewards
- In 70% of companies, OKRs are set quarterly
- The process of putting OKRs in place takes 1-2 weeks on average
- Participants who see greater improvements in performance and customer orientation take longer to set their OKRs – typically 3 weeks or more
Focus Is Tough
Our results show that limiting objectives and key results to fewer than 3 can be a challenge:
- 38% of teams have more than 3 objectives
- 27% report have 1-3 objectives
- Over a third have more than 3 key results per objective
The Process Is Low Tech
In preparing, sharing and tracking OKRS, most use low-tech tools:
A small percentage of participants used special tools:
Company, Team and Individual OKRs
78% of companies use company and team OKRs, but not individual OKRs and
79% of participants do not link OKRs to team members’ individual performance reviews.
Top-Down or Bottom-Up?
The approach to OKRs implementation in most companies is top-down with top-management and conflicts around OKRs is typically handled by top management:
- 77% of companies start with annual goals for the company (with the exception of small companies at only 62%)
- 69% of participants report that an OKR cycle starts with top management setting the company OKRs first
- Over 54% of companies cascade OKRs from top to bottom first. Only 12% do it the other way round
- 62% of participants say the CEO or top tier of management introduced OKRs to their company
In more than 52% of the companies, when conflict occurs, top management gets involved.
Attitudes to OKRS
To better understand attitudes towards OKRs we asked participants to select words they associated with the benefits and challenges of OKRs. We presented both positive and negative descriptions and participants chose more positive items (22% on average) than negative ones (10% on average).
Top positive items:
- Deciding on priorities (46%)
- Aligning teams (45%)
- Focus on results (40%)
It’s taking time to learn as a company. Getting all people together. Short feedback cycles. Fast decisions.
Top negative items:
- Pseudo-quantify everything (23%)
- Rush goal-setting part (18%)
- Neglect follow-through (16%)
- Be over-ambitious (16%)
For me, it’s a bureaucratic way of formulating what we know already, fitting our outcome goals and direction into a given rigid format, and fake quantifying things that are not quantifiable.
Participants who report more positively on performance and/or customer value, as well as OKR veterans, use health metrics (KPIs to track the overall health of the business) to balance OKRs.
In 68% of all companies, everybody can see all OKRs. In small companies this number is 86%, in large companies, it’s 51% and 48% of all respondents say the main benefit of using OKRs is increased transparency across the organisation.
- The majority (68%) track OKRs fully publicly
- More than half also update and track the probability of key result achievements
- Participants at executive level see a greater benefit to have full transparency than the other participants
The top 3 challenges of OKRs are:
- Setting objectives that really quantify an objective (48%)
- Defining guiding objectives (40%)
- Balancing top-down and bottom-up (40%)
Managing Balance and Trade-offs
Setting OKRs requires companies and teams to make hard decisions around trade-offs, and for our participants, the majority of the trade-offs made relate to getting stuff done. They chose:
- Action rather than reflection
- Deciding on priorities rather than identifying opportunities
- Top-down guidance rather than bottom-up involvement
- Output and results rather than input and resources
Do OKRs Improve Performance?
Fewer than 15% of respondents feel that OKRs deliver noticeable performance improvements and greater customer value.
- OKRs are still new – 78% have been using OKRs for less than 2 years
- Focusing objectives is hard – 38% of teams have more than 3
- The process is top-down – 69% say an OKR cycle starts with top management
- OKRs do aid transparency – In 68% of companies, everybody sees all OKRs and 48% see transparency as a key benefit
- OKRs don’t = performance improvements – only 15% think they do but almost half say they’ll continue to use them in future
- Mind the Product’s extended report (analysis of the results above)
- Measure What Matters by John Doerr
- Team Objectives – Review, by Marty Cagan
- OKR vs KPIs, What is the Difference?
- The Art of OKRs by Christina Wodtke
- How to Write OKRs That Don’t Suck by Adrian Howard