BetterWorks held its first Goal Summit last week. Kris Duggan, BetterWorks CEO, opened up the event by proposing a goal system that is more open, measurable, and frequently updated.  Duggan explained how making everyone’s goals visible to everyone in the organization can reduce politics and silo effects at work.

I left the summit even more convinced that Betterworks is ushering in a new era of goal setting and collaboration that will drive better execution. Donald Sull, who gave one of the two presentations I will be discussing in this series of articles, refers to this new era as "Goals 3.0". 

This first post features key takeaways from John Doerr on Objectives and Key Results (OKRs).  His talk was titled: “Why Goals Matter: A Fireside Chat with John Doerr. John's thoughts on why your company needs to implement a goal setting process right now, and common pitfalls he sees when it's not done right.”  

Doerr explained how he introduced OKRs at Google. He explained that each organization must tune the OKRs model and adapt it to their culture. I now see that organizations have the ability to adapt their use of OKRs to shape their culture. John provided several core components of the OKRs model including:

• Everyone does them (individual contributors, not just team leaders)
• There’s a regular cadence (Intel did them monthly; Google does it quarterly)
• Include the stuff that matters most (No need to put everything you do into an OKR)
• Goal system should be separate from compensation (Prevent gaming the system)

As for the quantity of OKRs, Doerr suggested 5-7 Objectives with 4-5 Key Result each.  These numbers seemed a bit higher than the original guideline from Doerr’s Basic Hygiene slide as presented in the 1990s to Google: “Maximum 5 objectives with 4 key results.” I was pleased to see the increase given that my work with OKRs suggests that making goals more granular can make them more actionable (See How Many OKRs Should You Really Have?)

Doerr noted that until BetterWorks, OKRs were often tracked in WIKI, Excel, or some other general productivity tool which made OKRs a disaster to track across the organization. Doerr's positioning of BetterWorks as defining a new era where tools will be available to support OKRs is spot on. I could not find such a tool after helping a mid-size software company get started with OKRs even in 2013! John expanded on his basic hygiene slide during his talk with Kris:

OKRs are used on a rhythmic basis.
Intel set new OKRs each month and that was right for their culture. Although the default is to reset OKRs each quarter, some are now updating OKRs every 6 weeks. OKRs can also be done on an annual basis in parallel to a more frequent cadence.

OKRs are more than a declaration.
They are used to check progress and can even become the language used in staff meetings. For example, if a discussion leads to something really important, a manager might say “this should be a key result.” OKRs gives you clarity with the intellectual discipline of measurement. It takes time as you develop goal setting muscles. Over the course of several quarters, you and your team get better.

OKRs do not require grades.
Doerr also updated the OKRs community on best practices for grading OKRs. Google apparently started as done, not done, or half-done, but evolved their own 0-1 scale with decimal-level resolution. Some rate OKRs with traffic lights. Duggan and Doerr also suggested that organizations beginning to implement OKRs should consider layering in grading after several quarters. Simply defining measurable goals and making them visible can be a major cultural change so layer in the grading when the organization is ready.

OKRs need not be "tightly coupled."
A special thank you to John Doerr for clarifying the extent to which OKRs are cascaded through an organization.  Doerr noted, “OKRs need not be hierarchically coupled.” In Doerr’s famous Football Example OKRs are tightly coupled. Google does not have such a tightly coupled system. Larry and Sergey state the company OKRs, inspiring other teams to create their OKRs. The company OKRs roughly inform other OKRs. There is no formal cascading process requiring every OKR to be specifically tied to another. OKRs exist as an open, social contract.

OKRs can define your culture.
Doerr explained how OKRs can be adapted to reflect and even define a company’s culture. Google feels like OKRs are part of their DNA. Doerr shared a story of how CEO of Lotus, recall Lotus 123, adopted OKRs and created “NOKRs.” The "N" stands for "Not." Lotus used NOKRs to specify what they would not do: “Lotus should not do hardware.” Thanks John! I may try NOKRs with one of my clients who are really looking to improve focus.

OKRs can help you raise money.
Doerr is a great story teller. He described how a company he visited posted their OKRs over a urinal in the men’s room. I left the presentation with a strong message that transparency and visibility of OKRs can set the stage for great things. And, if you’re a start-up, you may want to consider OKRs, as Doerr left us all with the message that “a good way to get me to invest is to already adopt OKRs.”

Next up in this series on Goal Summit 2015 - how we have evolved from Goals 1.0 to Goals 3.0 as explained by MIT professor Donald Sull, in his presentation titled: “Goals 3.0: Harnessing the Power of Social to Get Work Done”.