I haven't yet seen an organization that benefited from OKRs. I'm not saying they don't work, I've just never witnessed them working.
My main gripes with them:
- They focus on output, and I believe most organization (especially startups) should focus on input. In that regard, I'd spend more time figuring out your internal playbook rather than measuring the (invariably too many) goals you've set for yourself and your team at the beginning of the quarter.
- The don't reflect reality. As soon as you set measurable outcomes for anything beyond the hard success metrics (e.g. revenue, profit, churn, CAC...), expect people to try and game the system. This leads to either people hitting the numbers but missing the mark, or simply failing to report accurately.
- They're mostly useful for underperformers. I have the same feeling about 1:1s. Your top performers usually don't need OKRs to know what needs to be done or how well they're performing. This ends up being a lot of busywork, especially for those who want to get sh*t done.
I wouldn't "improve" OKRs. I'd drop them:
- Set high level goals for the company (e.g. revenue, customer acquisition and employee retention).
- Have leadership set TODOs for the company and teams, BUT use this mostly as a way to foster debate and alignment on what needs to be done. Expect them to change often.
- Focus on your inputs. And on that topic, I would invest in building a culture of documenting what you do and how you do it (for example through a playbook). You can't build on quicksand.
Management should communicate at a high level the direction the company is going in and why. They need to set a vision, explain why it's good, then break that down into larger targets. Workers underneath management should come up with specific ideas for meeting those targets. They should all meet and then align on the specific ideas to implement.
I think this doesn't happen because explaining why you're going in a certain direction is hard. Most startups don't really know if the direction they are going is correct and are just trying a bunch of things. This doesn't lend itself to management putting themselves out there and as such, try to push some of that work out to normal employees through OKRs and trying to make them more "autonomous". At the end of the day, there's only so much under our control and the OKRs don't help.
Might be semantics as the changes I describe are fairly substantial compared to how many companies implement them. I did think of not calling it OKRs anymore at the time but the effort to rebrand it internally didn't seem worth the payoff. I like your suggestions - anything that increases clarity, alignment and debate. If a team wanted to align based on a memo or other doc we could debate I'd go for that as an alternative to OKRs. Documenting what you tried, what worked and why and what you intend to do makes sense to me!
> Set high level goals for the company (e.g. revenue, customer acquisition and employee retention).
That sounds like OKRs by another name to me. Objective 1: increase revenue. Key result 1a: achieve $X revenue this quarter. Objective 2: increase customers. Key result 2a: number of customers exceed Y by this quarter. Objective 3: increase employer retention. Key result 3a: employee attrition stays below Z% this quarter.
I think they are different. They’re simply targets for your business, the way it’s been done way before OKRs we’re a thing (e.g. target revenue for the year is $20M, churn should be brought to 5%). OKRs have a methodology and format attached to them and tend to trickle down multiple level in the organization.
There isn't really one way to do OKRs - you can read a dozen different descriptions and have a dozen variations. It's not a formal methodology but rather an approach that for a long time was passed around organically based on some key adjustments to MBO (Manage By Objectives) which came before it.
E.g. How Measure What Matters and Radical Focus describe OKRs - two of the most popular books on the subject - differ quite a lot.
I think finally there's some consensus that cascading OKRs is a bad practice but unfortunately people keep.doing it because that's how it was described in MWM.
We tended to have goals / OKRs per team and longer term goals they could align to. Flatter the better when possible.
Prioritizing your work. What you are doing, why you are doing it, what’s going to be the best return on your time, what is your capacity to actually accomplish things and are you overloading yourself so that you have to rush everything constantly.
input = available expendable resources?
output = created resources?
Naturally, the output is constrained by the available input. If a KR doesn't take into account the available input, then it is prone to be unrealistic.
Not the OP, but to me inputs would either be leading indicators or something like “shoot 1000 3-pointer/ every day” and not “get an NBA championship ring”.
My main gripes with them:
- They focus on output, and I believe most organization (especially startups) should focus on input. In that regard, I'd spend more time figuring out your internal playbook rather than measuring the (invariably too many) goals you've set for yourself and your team at the beginning of the quarter.
- The don't reflect reality. As soon as you set measurable outcomes for anything beyond the hard success metrics (e.g. revenue, profit, churn, CAC...), expect people to try and game the system. This leads to either people hitting the numbers but missing the mark, or simply failing to report accurately.
- They're mostly useful for underperformers. I have the same feeling about 1:1s. Your top performers usually don't need OKRs to know what needs to be done or how well they're performing. This ends up being a lot of busywork, especially for those who want to get sh*t done.
I wouldn't "improve" OKRs. I'd drop them:
- Set high level goals for the company (e.g. revenue, customer acquisition and employee retention).
- Have leadership set TODOs for the company and teams, BUT use this mostly as a way to foster debate and alignment on what needs to be done. Expect them to change often.
- Focus on your inputs. And on that topic, I would invest in building a culture of documenting what you do and how you do it (for example through a playbook). You can't build on quicksand.