If you do things, you’ve probably faced indecision. Just this week I was trying to decide if I should write this summary or do some research for work. I still don’t know if I made the right call, probably because I don’t have a goal-setting system (yet). But I will be, after reading Measure What Matters!
Measure What Matters explores a management system based on Objectives and Key Results (OKRs).
Objectives are directional. ‘Colonize Mars’ might’ve been a good objective for SpaceX. Good objectives are ambitious and make you uncomfortable.
Key Results are how we get there. If our objective was ‘Colonize Mars’, our key results might be:
- Land and re-launch a reusable rocket by July 2017
- Transport an astronaut to the space station by September 2018
Good key results are specific, time-bound, and measurable.
I like to think of objectives as our compass heading, and the key results as the distance milestones. Once we are pointed in the right direction, we start breaking the distance down into manageable chunks and completing each chunk, one after another.
Example of OKRs
Objective: Walk across Canada
- Walk from Vancouver to Calgary by June 1.
- Walk from Calgary to Toronto by July 1.
- Walk from Toronto to Halifax by August 1.
By setting goals this way, we can break them into small, achievable and objectively measurable pieces. Then, we can focus on each of those little pieces one at a time, while keeping in mind the objective, or overarching reason why we’re doing these things.
Many companies use these at an organizational level, including Google. In the Google model, there are two types of OKRs— committed and aspirational.
Committed OKRs are agreed upon goals that we will achieve. The expected score for these OKRs is 1.0. These are base-level expectations which should not be compromised.
Aspirational OKRs express how we’d like the world to look. The expected score for these OKRs is 0.7. They should stretch the capabilities of an individual or organization to the limit and thus, should sometimes result in failure. You focus on aspirational OKRs when committed OKRs are on track.
Example of committed vs aspirational key results
Objective: Gain a world-class education in chemical engineering.
- Committed: Graduate from MIT with a degree in chemical engineering
- Aspirational: Achieve the top marks in every class I attend at MIT.
In the example, above, the student should focus on her committed key result of achieving a passing grade in her courses first. If that’s on track, she can turn her attention to the aspirational key result and stretch for higher academic achievement.
While OKRs work well in a personal context, as above, they are more often applied in organizations. In fact, shortly after writing this article they were implemented at Benevity, the SaaS software company where I work.
OKRs in Organizations
OKRs within organizations are typically implemented in a waterfall fashion, set at the executive level and then spilling down to the next level, and the next, all the way down to the front-line employees.
This is critical because it creates alignment. When the dust settles after an OKR cycle, every person in the boat should be rowing in the same direction. In Measure What Matters, John Doerr refers to ‘alignment’ as one of the ‘OKR superpowers’.
Example of OKRs in an Organization
Objective: Sell more ice cream to than any other ice cream shop in Calgary.
- Sell 500L of ice cream
- Employee willingness to recommend rate >90%
VP of Manufacturing
Objective: Produce 500L of ice cream
- Make 200L Vanilla
- Make 200L Chocolate
- Make 100L in new seasonal flavours
VP of People
Objective: Employee willingness to recommend rate >90%
- Implement new benefits program by end of Q1
- Perform quarterly ‘willingness to recommend’ survey
- Perform workplace pay band assessment by end of fiscal year
Essentially, the CEO and leadership team set the company-level OKRs. They then cascade down, so that the Key Results of the leadership team become the Objectives of their direct reports, etc, all the way down to the front-line employees.
According to John Doerr, good OKRs have these superpowers:
- Focus the organization on what matters
- Allow us to measure progress towards our goals
- Create alignment in groups
- Allow us to stretch to achieve things we wouldn’t have thought possible
Though they feel indispensable for massive organizations, they also seem relevant to small organizations and individuals. It’s a nifty concept that I’ve implemented into my personal and work life for the last 4years, and have found quite helpful!