This article was sponsored by Stratford Group.
So, after reading our previous blog post, you’ve decided that OKRs (Objectives & Key Results) are the strategic planning framework that makes the most sense for your organization to be effective in goal setting and leadership accountability. Now what?
We’ve brought strategic planning expert Harry Page back to the interview chair to discuss how one might go about implementing OKRs in the context of your Mission, Vision, Values and Strategies.
OKRs, by necessity, are often challenging, ambitious goals with measurable outcomes, which can be intimidating if the scale of implementation is particularly ambitious. To ensure they remain attainable and encourage engagement from the key stakeholders and team members, Harry recommends a 3-5 approach.
Keep it Simple
To achieve success, many organizations apply the KISS principle…which often results in a cascading approach using a more gradual roll-out by piloting the OKR methodology within a single team before implementing it across the full organization. This deployment model often sees the pilots developing cascading OKRs down to the first level functional groups and in some cases even to individuals.
While this is certainly a viable approach to strategic planning, Harry’s 3-5 methodology favours a company level approach. When I asked him why, his response was “If achieving your strategy is the most important thing you can do (and what else can contend with that?) than shouldn’t you be starting at the company level?”
Certainly, Harry’s argument makes sense, but a companywide initiative can seem like a hefty undertaking, rife with opportunity for a situation not dissimilar to “our eyes were bigger than our stomach.” My next question was, “How can organizations avoid this and keep the scope manageable?”
Keep it Manageable
This is where the 3-5 rule comes in; to keep it manageable, Harry recommends keeping those Company-level objectives to 3-5 critical outcomes with a similar number of Key Results. The cascade process then should encompass Functional OKRs that define what each group does to contribute to Company-level success. Any more than 3-5 and you diffuse your effort, and you limit your probability of success on what really matters.
For those new to the framework, to begin implementing OKRs seems pretty simple and easy to accomplish but doing it well is a lot more difficult than it looks. Often organizations find that the first pass through an OKR process will be an awkward learning experience.
“In my experience, often companies define too many OKRs – an untenable situation from the start which leads to angst and confusion when not delivered. When working with clients, my key message is that OKRs define the things you must do, and they are not the only thing you do.”
If you start from the top, with OKRs done within the context of your Strategic and Operating Plans then Company-level objectives may well persist throughout the year while KR targets may increase at each subsequent iteration. It is a persistent fallacy that as the OKR cycle is refined every 13 weeks, there is a complete overhaul from the previous set with new Objective and Key Results set for the coming quarter.
A key point Harry likes to make with his clients is that quarterly-focused KRs are part of a journey towards where you want to be in the annual plan – they are not an end unto themselves.
Once you’ve identified your 3-5 mission critical objectives, what are some other roadblocks that may pop up that could derail your implementation? Over the years, Harry has witnessed several critical errors that organizations can learn from in the adoption process.
Keep it Realistic
The first occurs in the planning stage, where organizations don’t consider the interruptions or emergencies which will undoubtedly occur, sometimes resulting in missed KRs. Making the assumption that nothing will distract you from the activity underpinning an OKR is unrealistic.
Another implementation consideration is to not over-focus on the coming OKR cycle and lose sight of what happens next. While planning for the coming quarter think ahead to the following two quarters. If you have embedded stretch goals into your implementation what you think you need to do in the subsequent quarter could help identify the stretch goal for the current planning cycle.
Harry’s last piece of implementation advice for now is that when managing an OKR implementation, missing a KR shouldn’t invalidate it. Some organizations have a tendency to lower the target or sometimes remove an OKR completely due to lack of achievement. This is a critical error as when creating context-driven objectives there must have been keen justification for incorporating the OKR the first place.
Harry is a wealth of knowledge when it comes to strategic planning, and I have enough notes to write another piece about the OKR setting and review process but hopefully this edition provides more insight and lessons-learned that can be leveraged in your adoption of OKRs if that is the right tool for your organization
About Harry Page, executive advisor
Harry is an accomplished senior executive with extensive experience leading organizations in the telecommunications and electronics sectors. He has international experience in both start-up and established organizations. In his career he has also acquired considerable experience in consulting with public sector and government agencies. Harry has a proven track record of delivering results.
Throughout his career he has demonstrated a proven ability to lead strategy creation, employee development, managing change and performance improvement. He has led or participated as a core team member in many corporate merger and acquisition initiatives, ranging from early-stage companies to large multi-site, multi-national integrations.
He has extensive experience in organizational development and implementation that has resulted in entities evolving capabilities and performance to meet changing environmental conditions.
He has led public sector functional redesign activities as well as designed and implemented an extensive service quality management system for two core Federal Government departments. He also has considerable experience in implementing performance metric systems in public sector organizations.