OKR: How to set goals and fulfill them at 70%
Half of the success in project management is goal setting, and this is not the easiest half. At Wrike, we at one time thoroughly attended to the choice of the optimal approach to goal-setting at the level of the entire company and individual teams, and eventually settled on OKR. Initially, the concept of Objectives & Key Results (goals and key results) originated in Intel, but it was really made popular by John Doerr from Google.
The essence of OKR is to eliminate the way to achieve a result when setting a goal and, at the same time, to provide a way to objectively evaluate the result.
This allows:
')
OKR is a list of goals, no more than five, for each of which measurable results are given, also no more than five. Example:
Objective: Post a good article on OKR.
Within the company, OKR works as a hierarchy. The common goals of the company define the goals of individual divisions, those are the goals of the teams, on the basis of which, in turn, individual goals are built.
The hierarchy of goals does not have to be strictly vertical. Individual units or teams may set joint or related goals horizontally.
Forming an OKR is an open process. It takes place with the participation of all employees at the stage of making proposals. The method provides for three directions of communication:
Building OKR is a two-way process, and it is expected that half of the company's goals will be formulated in the top-down direction, and the other half in the opposite bottom-up. In the case of OKR, it is important to achieve a common understanding of the most important goals. Realizing that a particular idea is not as important as the other, it is easier to refuse to implement it and focus on working on things that are really important.
It is not expected that each department will support all global initiatives. Departments have a specialization, and this limits their ability to support all business objectives. For example, if the global goal is to “reduce production costs by 10%,” the marketing department may not be of much help.
In addition to supporting common business goals, departments or teams can and should set local goals for themselves. This is necessary, because at every level there is a potential for improvement, and if you focus only on global business goals, over time such a bias leads to dysfunctionality due to the accumulated problems.
Correctly formulate OKR is difficult, but possible. To do this, you must adhere to the following principles:
The goal must be ambitious. Her achievement should seem difficult, on the verge of a possible task. However, the goal must be potentially achievable, while remaining ambitious. Here are great examples of such goals.
An ambitious goal motivates to achieve the best results. People tend to reinsure themselves and set themselves simple goals, but in this case they may not be achieved. A difficult goal is a challenge that requires perseverance and ingenuity. Even if such a goal is not fully achieved, the result will be much higher than conservative expectations.
The number of goals should be from 3 to 5. This is important for two reasons. First, more targets lead to a dispersal of effort. Secondly, OKR is a global initiative, and it requires communication and coordination. It is possible to form and fulfill joint goals among a dozen departments, if each department has no more than five. If each department tries to work on a dozen goals, it will take all the time just to just figure out who plans what and what.
Goals should lead to new achievements. It makes no sense to aim to continue to do the same: hire only the best employees, maintain the service uptime of 99.9% or develop new features. These are all important things, but this is something that needs to be done without a reminder. OKR are not intended to maintain the status quo.
The target must determine the final state. That is where we want to go, what to get, what to achieve. Vague wording such as “improve”, “simplify”, “facilitate” is only confusing. A clear formulation of the end point allows you to focus on achieving it and create a specific plan for achieving it.
A typical mistake in formulating a goal is to determine the direction of movement instead of the final position.
Goals must be stated clearly. Goals, like the fact of their achievement, should be equally well understood by all observers.
- Dear, take out the garbage? (right now)
- Of course! (tomorrow morning)
Incomprehensible or ambiguous goals can lead to inconsistencies or conflicts.
The key result must be easily measurable. If the assessment can be made in theory, but we do not know how to implement it in practice quickly enough - it cannot be used to measure progress towards the goal during the quarter and determine success at the end of the quarter.
Each goal should be evaluated on approximately 3 key results. A large number of results as goals leads to defocusing. On the other hand, the only result actually replaces the goal.
Achieving the result should directly lead to the achievement of the goal. The result, indirectly affecting the achievement of the goal can lead to the fact that it will not benefit from, or it will impose the choice of the wrong decision.
The key result is the result, not the way to achieve it. Freedom in choosing the way to achieve the result is the essence of OKR, this is what gives the performer room to maneuver in choosing the most suitable solution.
The achievement of a key result must be confirmed. If in practice it is impossible to determine that the result has been achieved - the definition of such a key result makes no sense.
It is important to check that OKR is formulated correctly before taking them to work. Here is our checklist of 10 points:
In conclusion, it is worth saying a few words about the evaluation of OKR results. If OKR assumes ambitious goals, its achievement by 60-70% is considered a full-fledged success. A score of 80% or more is a sign that the goal was too simple. Then at the subsequent planning it will be necessary to raise the bar. A result of less than 50% is considered a failure. In this case, you need to analyze the causes of the problem and take them into account in the future.
-
Dmitry Mamonov
Wrike
The essence of OKR is to eliminate the way to achieve a result when setting a goal and, at the same time, to provide a way to objectively evaluate the result.
This allows:
')
- Avoid micromanagement - a manager can concentrate on priorities;
- Implement creativity - the performer can find a way to achieve the goal on their own;
- Objectively evaluate the result - the measurability of the results allows you to objectively determine whether the goal has been achieved. If not, this is a reason to analyze the reasons for the failure and input data for subsequent planning.
OKR structure
OKR is a list of goals, no more than five, for each of which measurable results are given, also no more than five. Example:
Objective: Post a good article on OKR.
- Result: The article should be published no later than May 23, 2017.
- Result: The number of views - 40 thousand.
- Result: Rating - +35.
- Result: Interesting and constructive comments - 10.
Within the company, OKR works as a hierarchy. The common goals of the company define the goals of individual divisions, those are the goals of the teams, on the basis of which, in turn, individual goals are built.
The hierarchy of goals does not have to be strictly vertical. Individual units or teams may set joint or related goals horizontally.
Where to begin
Forming an OKR is an open process. It takes place with the participation of all employees at the stage of making proposals. The method provides for three directions of communication:
- Top-down - the goals formulated for the company as a whole, apply to OKR of its departments, teams and employees. This is a needs-based scenario.
- Side-by-side - individual departments cooperate in building common OKR, in addition to supporting the company's global OKR. For example, development and support may launch a joint initiative to reduce the number of defects. This will be a scenario with the formation of goals based on cooperation .
- Bottom-up - a particular good idea can turn into an OKR team, department, or even the entire business. That is how Gmail appeared, starting from a personal project of one of Google employees. If we understand that we can do something good, useful and valuable, this idea can be spun in the opposite direction and set a goal for its implementation. If we have found a gold mine, let's develop it. Of course, this rarely happens, this is a scenario of forming goals based on a decision .
Building OKR is a two-way process, and it is expected that half of the company's goals will be formulated in the top-down direction, and the other half in the opposite bottom-up. In the case of OKR, it is important to achieve a common understanding of the most important goals. Realizing that a particular idea is not as important as the other, it is easier to refuse to implement it and focus on working on things that are really important.
It is not expected that each department will support all global initiatives. Departments have a specialization, and this limits their ability to support all business objectives. For example, if the global goal is to “reduce production costs by 10%,” the marketing department may not be of much help.
In addition to supporting common business goals, departments or teams can and should set local goals for themselves. This is necessary, because at every level there is a potential for improvement, and if you focus only on global business goals, over time such a bias leads to dysfunctionality due to the accumulated problems.
How to formulate goals
Correctly formulate OKR is difficult, but possible. To do this, you must adhere to the following principles:
The goal must be ambitious. Her achievement should seem difficult, on the verge of a possible task. However, the goal must be potentially achievable, while remaining ambitious. Here are great examples of such goals.
- Designing an aircraft flying faster than sound speed is an adequate and ambitious goal of Bell Aircraft in 1946.
- Designing a plane that can fly is an adequate and ambitious goal for the Wright brothers in 1900.
An ambitious goal motivates to achieve the best results. People tend to reinsure themselves and set themselves simple goals, but in this case they may not be achieved. A difficult goal is a challenge that requires perseverance and ingenuity. Even if such a goal is not fully achieved, the result will be much higher than conservative expectations.
The number of goals should be from 3 to 5. This is important for two reasons. First, more targets lead to a dispersal of effort. Secondly, OKR is a global initiative, and it requires communication and coordination. It is possible to form and fulfill joint goals among a dozen departments, if each department has no more than five. If each department tries to work on a dozen goals, it will take all the time just to just figure out who plans what and what.
Goals should lead to new achievements. It makes no sense to aim to continue to do the same: hire only the best employees, maintain the service uptime of 99.9% or develop new features. These are all important things, but this is something that needs to be done without a reminder. OKR are not intended to maintain the status quo.
The target must determine the final state. That is where we want to go, what to get, what to achieve. Vague wording such as “improve”, “simplify”, “facilitate” is only confusing. A clear formulation of the end point allows you to focus on achieving it and create a specific plan for achieving it.
- Launch product for market segment Z.
- Achieve product sales of $ 2 million / year.
- Reduce the number of hits to the support because of bugs by 50% (from 250 to 125 per day).
A typical mistake in formulating a goal is to determine the direction of movement instead of the final position.
Goals must be stated clearly. Goals, like the fact of their achievement, should be equally well understood by all observers.
- Dear, take out the garbage? (right now)
- Of course! (tomorrow morning)
Incomprehensible or ambiguous goals can lead to inconsistencies or conflicts.
How to formulate key results
The key result must be easily measurable. If the assessment can be made in theory, but we do not know how to implement it in practice quickly enough - it cannot be used to measure progress towards the goal during the quarter and determine success at the end of the quarter.
- The loading time of the main page of the site was reduced from 3.1 to 1.2 seconds.
- Feature X is published until August 1st.
- Order processing time decreased from 12 to 6 minutes.
Each goal should be evaluated on approximately 3 key results. A large number of results as goals leads to defocusing. On the other hand, the only result actually replaces the goal.
Achieving the result should directly lead to the achievement of the goal. The result, indirectly affecting the achievement of the goal can lead to the fact that it will not benefit from, or it will impose the choice of the wrong decision.
The key result is the result, not the way to achieve it. Freedom in choosing the way to achieve the result is the essence of OKR, this is what gives the performer room to maneuver in choosing the most suitable solution.
The achievement of a key result must be confirmed. If in practice it is impossible to determine that the result has been achieved - the definition of such a key result makes no sense.
Check list
It is important to check that OKR is formulated correctly before taking them to work. Here is our checklist of 10 points:
- OKR should be compact. No more than a page of text, ideally half a page.
- OKR is not a to-do list or a work plan. If OKR look this way, then they need to be recycled.
- At least one OKR team must be linked to the global goals of the company. Otherwise, it is unclear how the team has to do with the business.
- OKR priorities within the team should increase the likelihood of achieving the goals of the company. The key business objective should not be reflected in the OKR team's last point.
- Related initiatives must be agreed. Development plans to release product Z, and marketing to ensure its promotion. If the issue is held at the very end of the quarter, time for its promotion will not be enough.
- All global team promises should be included in its OKR. If the other team assumes that the department is working on goal X, but in reality nothing like this happens - this is a problem.
- Goals should not define normal and regular business tasks. True, the effect of the Black Queen , when you need to run to stay in place , has not been canceled. If extraordinary efforts are required to preserve the achieved results, the goals for their regular activity can also be included in the OKR of the department.
- Achieving the goal should require the efforts of the entire department or team. Otherwise, the staff of the department is bloated or its employees are not motivated enough.
- Achieving goals should lead to substantial business benefits.
- Certain results should be sufficient to achieve the goal. If the achievement of a goal is determined by the results insufficient to recognize its success, this will lead to real delays in work due to lack of resources at the moment when unrecorded requirements appear, and failure of the planned deadlines as a result.
In conclusion, it is worth saying a few words about the evaluation of OKR results. If OKR assumes ambitious goals, its achievement by 60-70% is considered a full-fledged success. A score of 80% or more is a sign that the goal was too simple. Then at the subsequent planning it will be necessary to raise the bar. A result of less than 50% is considered a failure. In this case, you need to analyze the causes of the problem and take them into account in the future.
-
Dmitry Mamonov
Wrike
Source: https://habr.com/ru/post/329272/
All Articles