Operational Governance Knowledge Flashcards No. 14/19

OKRs — Objectives and Key Results

From the Operational Governance flashcard deck; today this discipline goes by BizOps. The original card is republished here as a field note.

01 What is it

A paradigm for setting and tracking goals across an organization in a way that makes them:

  • Focused — committed to priorities
  • Aligned — connected across teams
  • Trackable — for proper accountability
  • Stretched — to “dare” to meet amazing challenges

02 When is it useful

When you want to strike a balance between (1) making sure that everyone’s efforts are aligned — and hence reinforce each other — while at the same time (2) allowing enough flexibility for people’s intrinsic motivation to be the driver of the strategy execution.

03 How to use it

  • The “Os” can be more fun and exciting, but the “KRs” must be easily measurable and time-bound.
  • It is different from other goal-setting frameworks in that it is set ~50% bottom-up, not in a waterfall manner — you could say it’s market dynamics for goal setting.
  • It is mostly decoupled from compensation. Otherwise, there can be no true stretch.

04 Checklist for a good OKR

  • Is the Objective memorable?
  • Are the KRs focused on outcomes?
  • Do the KRs pose challenging trade-offs?
  • Is it really what matters the most?

Example

Successfully migrate the platform

Objective
  • Reduce infrastructure costs from X to Y
  • Maintain availability during migration at 99.99%
  • Maintain revenue of €€

05 Common pitfalls

  • It is NOT a to-do list: KRs focus on outcomes, not tasks.
  • It is NOT a project or process management methodology.
  • It is NOT an employee evaluation tool (just one more input). It is a leadership paradigm for communication, empowerment, ownership, and driving outcomes.
  • KRs do not exist in isolation, but in the context of trade-offs against the other KRs within the same Objective.
  • The other teams you depend on must be on board with your KRs.

06 References and resources