“Makers of Tomorrow” is an initiative of the German government for university students with the explicit mission of disseminating and promoting the entrepreneurial spirit. It is a deck of 10 online modules told by German and Silicon Valley startup founders.
During the launch event in June 2021, Eva-Maria Meijnen, co-CEO of PlusDental, was sharing how they had built the OKRs culture in the company when Chancellor Angela Merkel, present there, asked: “What are OKRs?”. So Eva explained in straightforward language the basic principles of OKRs. So I thought it was a great way to kick off this post for Mind the Product’s OKRs Focus Week.
Perhaps this is one of the topics that most attracts me to our discipline because critical values and principles in product development play in it, such as continuous alignment, focus, measurement of results, and collaboration between one or more teams.
Born at Intel in the 80s and very well explained by Andrew Grove in High Output Management, OKRs (Objectives and Key Results) is a goal-based tool to achieve extraordinary results in terms of growth that endless tech companies around the world use today.
In a few words, OKRs are a model of quarterly objectives, measurable, and ideally generated bottom-up direction. They are challenging, not set in stone, and seek to develop alignment based on expected results, regularly reviewed and written in terms of the expected value to be achieved in the Q and not so much linked to one or another task.
Let’s go in parts and see each of these elements separately:
They are a model of Quarterly Objectives
It is understood that a period of three months is sufficient to generate results. When we talk about results, we refer to the impact on the business KPIs and the user experience, which is the focus of a product-oriented organization.
One of the main characteristics of OKRs is their morphology and their writing so that at the end of the Q, we can measure the impact we generate with the user story or the epic we were working on.
It means that it is a team and collaborative activity, so avoiding a top-down OKR model is very healthy. Sitting down around the table to write the value we want to achieve, which indicator we are going to impact, and which will be the unit of measure with which we are going to size the results is a great exercise to starve each quarter.
They are not set in stone
OKRs are a flexible model, adaptable to the reality and context of the product. As a team, we can modify either the scope or, why not, ultimately the previously defined Objective. If that helps us to correct and generate impact, the change will be welcome. Change is transformative, and it is healthy for the team to make the necessary changes on time.
To shed light on some key areas we asked three product managers to share their experiences in this blog post.
They seek to generate alignment
One of the most important objectives that OKRs seek is to generate commitment and alignment. Alignment is not consensus.
Another characteristic of OKRs is that they are presented as genuinely challenging challenges, almost 100% unattainable. It is understood that achieving 70% of the OKR scope is a highly satisfactory baseline. Not setting conservative goals is part of the culture of product people.
It is an outstanding practice to carry out regular check-ins to give visibility to the own team, the rest of the teams, and the stakeholders on their evolution, resolve dependencies or make adjustments to ensure the impact on the indicators.
Written in terms of value
Some of this we already mentioned before, the important thing here is to establish the Goals in terms of value and not specific tasks. We can find endless examples in our experience as Product Managers where despite having met the deadline, having finished the task, the result is not achieved for any reason. That is why this point is critical in the product culture. And about the quantity, it is advisable not to have more than 3 or 4 OKRs per Quarter to guarantee everyone’s focus.
In his book “Product Direction, How to Build Successful Product at Scale with Strategy, Roadmaps, and Objectives and Key Results,” Nacho Bassino dedicates the whole third section to talk about OKRs: the process of managing them, deafening area and teams OKRs drafts, dependencies and feedback, check-ins, updates, and communication. Listen to this podcast on ‘How to create a product strategy – Nacho Bassino‘
Another great book is “Measure What Matters” written by the venture-capitalist John Doerr, mentioned earlier. It is an excellent summary of theory with many examples of OKRs. Great leaders share their experiences, from companies like Google or non-governmental organizations such as Bill and Melinda Gates Foundation or ONE led by Bono. John Doerr was the main responsible for bringing OKRs to Google.
Finally, “OKRs At The Center: How to use goals to drive ongoing change and create the organization you want” by Natalija Hellesoe and Sonja Mewes is a short and compact introduction to OKRs.
OKRs are a great tool for personal, team, or organizational objectives.
In my professional life, I have had the opportunity to set up the OKR culture first in a product development team and later adopted by the whole company where I was working for. Super challenging experience, and after one year, we could see extraordinary results in growth and result-oriented teams.
One of the most significant issues was to transform a task-oriented culture into result-oriented culture. It was tough to write for their objectives worth more than activities during the first three quarters, especially with the C-level members. And another big issue was the alignment between areas involved on the same OKR.
Several tools are oriented to set up, measure, make regular check-ins, and visualize how the OKRs are going on, but you (and your team) don’t need much more than a spreadsheet to begging. The main idea is to iterate quarter by quarter, and you will see learnings and improvements in both ways, growth and results culture.
Explore more OKR content
Integrating OKRs can be a huge asset to aligning teams and reaching business goals. Mind the Product has plenty of other resources to help you think through how to achieve this. Explore more content with a focus on OKRs, or search more topics in our Content A-Z.