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Getting started with anything new is hard. Even more so when it’s related to the big “S”. Strategy. People get worried about capital letter words like that. It’s huge, right? If you get this wrong, the impact is going to be massive and EVERYBODY IS GOING TO KNOW.
Well, here’s the thing: not having a strategy is even worse. Everybody will have their own idea of what good looks like and what they should be working on. Without this alignment, nothing brings them together and creates shared understanding. Everyone is going to be very busy but not much is going to look different in a year’s time.
A millimetre progress in a million directions does not equate to a kilometre of road travelled.
A millimetre progress in a million directions does not equate to a kilometre of road travelled. You will still be in pretty much the same place you started in unless there is a single direction of travel. OKRs can help you communicate that single direction of travel, but they can also help you break the “strategy paralysis” by giving you concrete tools to facilitate the right conversations.
Why the Secret to Success is Setting the Right Goals
John Doerr gave a short TED talk in 2018 that beautifully summarised the key aspects of the framework. He refers to it as "the why, the what and the how".
Everything starts with a compelling sense of “why”: in other words, articulate your vision. Capture the purpose of your organisation (or your department if you cannot influence beyond that) before you think about what you want to achieve.
Only then focus on what you are going to do to get closer to that vision - the "what" -, but don’t try to work out every step in advance! At best you will succumb to “planning fallacy” where you believe that because you have planned every minute detail it must necessarily happen that way. At worst you will feel overwhelmed and discouraged by the sheer amount of stuff you need to do, notwithstanding the tremendous amount of time you have spent planning when you should be doing.
As you distil your direction into strategic objectives, make them
Concrete: they describe a tangible business outcome
Action-oriented: they create impact and encourage you to do not just plan
Significant: they represent a major improvement or breakthrough for your organisation
Inspiring: they align with the organisation’s vision and create a natural sense of urgency, a desire to make this happen
Finally, consider the “how”. But this is not the how of “How are we going to get there?”, this is the how of “How do we know we’re heading in the right direction”? I’ve written an entire blog post that delves into good metrics so I won’t repeat this here. Instead, I want to spend some time on what makes good objectives and some tools and techniques you can use to help you craft your first set of OKRs.
Let’s talk cadence
What cadence should you use for your OKR cycle? OKRs are often mentioned in the same sentence as “quarterly” but this isn’t their only useful cadence. In fact, the common advice is to set annual, strategic goals at the company level and use these as an anchor point for tactical, quarterly goals at the department and team level. There is an excellent article from Felipe Castro on the subject here if you want to delve deeper into this subject.
Here is a sample timeline I recently created for a client:
Ultimately your cadence determines your review cycle. The aim is to keep your objectives constant within that period without being unnecessarily rigid. If you are a start-up still figuring out product-market fit then an annual review cycle is probably not appropriate - there is too much uncertainty in your organisation, your market, your product to make this appropriate. But if you are a more established, larger organisation then changing company objectives every three months is probably unhelpful.
How to draft candidate OKRs
For the rest of this article I am assuming that you are only just starting out with your OKR implementation and are trying to decide on your annual strategic objectives for the first time. Crafting good OKRs is surprisingly challenging - words matter so it is worth spending a little time to ensure you express exactly what you are hoping to achieve. After all, your teams will take these as their North Star for the year so you don’t want any unnecessary ambiguity.
To begin with, let’s leave the detailed wording aside and focus on the content. How can you possibly pick just three major goals for the organisation when you’re likely inundated by different project proposals, business cases from teams hoping for funding or just plain old problems that need solving wherever you look?
"Whereever you go, you will see at least 63 things that need fixing." Dan North
My lovely friend Dan North shared his “Rule of 63” with me not long ago. It does wonders for putting things into perspective. Loosely paraphrasing he said “Wherever you go, you will see at least 63 things that need fixing. Pick 3. Leave the rest for later.” Why is this statement so powerful? Because it gives you permission not to strive for perfection. It makes it clear that fixing everything is simply not an option so you may as well do three things well rather than burning yourself, or your team, out trying to do 63 things badly.
As you try to decide what these three things may be, I find it easiest to forget about existing backlogs, project registers or any other spreadsheets that may have accumulated with content that’s probably already out of date. People can usually tell you what needs fixing from the top of their head. Ask them!
Write down the things that come to mind. As you do that, remember that objectives describe outcomes, not outputs. Anything that describes the delivery of a project is not at the right level: “Implement Salesforce across the organisation.” Not an objective! To get away from implementation detail, ask “why” to zoom out and understand the underlying motivation that triggered the project proposal in the first place. By doing so you open up avenues of discussion and innovation to look at alternative routes to the same destination. Maybe you truly need to roll out Salesforce across the organisation - but maybe not, maybe there are other things you can do that will achieve the same outcome. Without understanding why you are trying to do something, you don’t give teams the information they need to innovate or the tools to make good decisions along the way.
The other thing to remember is that objectives are designed to move you forward, get you out of your status quo. There is no room for “Continue” in objectives; we are not trying to capture business as usual, we want to propel the organisation forward. What is the best possible year you can have, and what will be true at the end of it? How will things be different?
For those of you familiar with Jobs-To-Be-Done theory, the outcome statements you capture in your user research can make excellent objectives and simultaneously ensure that customer focus permeates the entirety of the organisation.
Picking 3 of 63
If after all this brainstorming you find yourself with too many candidate objectives, list them in order of relative importance. Once you have an ordered list you can literally draw a line.
I find the easiest way to do this is by starting with an arbitrary objective A at the top and then comparing this to a second objective B. How do these compare? Is objective B more important than A? If so, slot it in above, otherwise list it below. Post it notes will be your friend if you are doing this in person, otherwise use online whiteboard solutions like Miro or Mural. Repeat the process with your next candidate objective C. Repeat until you have found a place for all of your candidate objectives (those with an engineering background may recognise this as the good old insertion sort). THEN DRAW THE LINE.
By doing so, you are not suggesting that the rest is not important. Those that did not make the cut are simply less important than the rest. We are not saying "no" as such, we are simply saying "not yet". At the end of your cadence you deliberately create room for repeating this process - what does the world look like now? Have we done enough on our current objective that other things are now more important? If so, move on. If not, continue as you are for another cadence.
In an ideal world, you are aiming for no more than three objectives to pursue at the same time. If you are struggling with this at the beginning and your organisation is reasonably large, pick five to get you started. Fuzzy focus is better than no focus. Ensure that you are not struggling to limit yourself because your objectives are actually too low-level. Have you asked why frequently enough?
Example Objectives
To make this tangible, here are a few examples of what I would consider good objectives from the depths of the internet and my own client work that may help you frame yours:
Talk to our customers at the right time, through the right channels, more often to create higher value for our customer and us.
Build a great place to work.
Improve customer retention to drive up revenue.
Successfully launch our new product.
Extend our reach to serve new customers in Asia.
Establish our product as the most advanced offering in the market.
Final Thoughts
Hopefully these insights were helpful to get you started on your journey. In many ways, OKRs are a really simple framework but don’t let its simplicity fool you. The implementation can be more challenging than you may expect because it is ultimately about embedding a different way of thinking across your organisation. It is more about changing your culture than adopting a tool.
But don’t let that discourage you. Try your best knowing that you will probably get a few things wrong along the way. And that is okay. Make room for reflections at the end of each OKR cycle, talk about what worked well and what didn’t. Double down on the bits that worked and discuss ideas for how to improve the aspects that were less successful. Over time you will find an approach that works for you. Take the recommendations from the framework to set you up for success, but don’t be slave to them either. Tweak and experiment until you find something that makes sense and feels comfortable for your organisation. And acknowledge the fact that you will never truly be done with tweaking! As your organisation matures and your market changes, so will your goal setting process. Embrace change and be open to learning.
Don’t want to go it alone? You don't have to! Get in touch today to discuss how I may be able to help.
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