Implementing OKR — 7 things to ponder

In my experience I have noticed that it’s very easy to understand what OKR stands for. Further when you have heard of nimble companies of varying sizes from Google to Spotify have implemented, you think you have hit the holy grail.

To some extent, I think the above could be true. When the admiration for OKR turns to implementation – you now realize simplified things could be a challenge to implement in organizations which already have established some other measures.

Here I am sharing some interesting experiences and observations about OKR implementation.

Let’s look at the 7 areas that need to be addressed in your OKR journey.

• Typically, most companies have KPI or SMART goals already in place. So, the question from the team why are we changing from that? What’s the value in switching?
  • If the leadership or the coach or the consultant try to provide an impression that they are nearly the same, you have already lost the implementation. So be clear why you are making the change.
• Now, the leadership is clear about the need for the change. You now realize that change management from the existing way of working is a challenge, because on the surface it looks close enough to what you are already doing.
  • So, there’s a tendency now to say, let’s not rock the boat with the change. Let’s get the team to just re-align what the teams are already doing to the new “terminology” first.
  • This is the next biggest mistake I have noticed. The teams have quickly recrafted their current way to OKR without getting into the intent. It will become very difficult to further ask them to change later.
  • So, if you are calibrating your approach – be clear and transparent, as to what all lies in store in the future. They need to be fully aware that the first baby step is just that!
• Next let’s look at the typical pitfalls in the “simplification” of the implementation
  • Do you want to cascade or align the Objectives?
    • Your mid-level leaders are more comfortable with cascade, because it minimizes the need for a change in their thinking and way of working.
    • If you cascade you will see the alignment for sure; but then you have lost the spirit of OKR.
    • Contrary to the belief that cascade makes it fast, they tend to take more time.
    • Cascade further tends to erode the autonomy of the team, and worse teams tend to show a superficial alignment with “the boss” while continuing to progress on what they set out to do earlier.
  • Do you think “shared OKRs” are a no-no in an existing enterprise?
    • Even when your enterprise shows each team or a sub-division/ division to be seemingly in control of their work, real world is not always that way (this topic is an entire post unto itself).
    • Mid-level leaders/ team leaders now realize that OKRs could reveal the true alignment. This can lead to a couple of scenarios:
      • Avoid the alignment outside of your own sub-division/ division, though exposing this would be a big benefit – as it reveals the complexity of the organization in getting things accomplished.
      • Or look at a moon-shot – how to actually keep the interactions de-coupled. This could result in rethinking the overall architecture and the process of working. This can be wonderful, if the intent is the same. But the risk of this decision needs to be made visible for the value it could generate.
• The next question that arises – how do you measure what you have set out to do?
  • The very journey of OKR would have begun with the fact that business wants every team to be able to know, show and work towards making a business impact. In other words, the measurement of the outcome is the goal.
  • The challenge in most organization is due to the complexities of the structure most of the teams are able to only look at their output. So, there’s a tendency to drift towards measuring the output – as quantification is the mantra of OKR.
  • Getting the alignment to outcomes is a key measure of success, and it can result in the need to cut through an organization’s political boundaries (unstated but real).
• Now that you have started to objectively measure, the next part of the puzzle is about setting targets that are beyond what you normally achieve. How does that play out?
  • Google’s 0.7 of the KR happens to be the basis of many a team and organization’s way of starting. That’s a good start – the trick lies in how you really go about it?
  • Depending on how the organization looks at what you deliver, teams now tend to recalibrate what they would earlier comfortably deliver at the 0.7 level mark. Further, everyone’s aware that 0.7 is the likely accomplishment. This can result in aiming for the 0.7 of the KR rather than the whole KR, potentially defeating the very purpose of thinking beyond the normal.
• In the midst of all this quantification and change, the biggest question on every employee’s mind is “How will this system now impact my performance rating?”
  • Trying to state that this process of OKR has no co-relation with your appraisal system is not going to cut the grade, given that everything is very clearly quantified.
  • So, it is imperative that the organization understands how the OKR will enable the appraisal process, and clearly be able to articulate where it is linked and where it is not linked with every individual and team’s performance. If this is not clear, then the whole exercise of getting into OKR could just be “old wine in a new bottle”.

What’s the bottom-line in implementing OKR?

By now you would have realized it’s the intent, the approach to change, and above all the culture is what will determine if you have implemented OKR in letter or in letter and spirit.

Srini