9 ms·

OKRs masquerade as strategy

321 points by asplake 5y ago

deleted 5y ago
[deleted]
shatnersbassoon 5y ago
You say "Objectives and Key Results" I say "Pre-emptive Hierarchical Blamestorming" OKRs further entrench hierarchies in a way that is harmful to productivity and harmony. They allow for a whole middle layer of management that simply decomposes their KRs and passes them down. The people below them are ultimately the ones on the hook for delivering, and if the middle manager doesn't achieve their own KRs, they already have an agreement about which person that reports to them is to blame. In my organisation OKRs are being used as a sort of feudal system whereby the peasants work the land, but the credit is passed up the chain to the seigneur.
PaulHoule 5y ago
I think of Steven Covey's "Begin with the End in Mind". There really are some metrics that are strategic. But when your manager is asked to have 20 OKRs just because your manager has to have 20 OKRs and then you get asked to have 20 OKRs that is a distraction. (In terms of strategy there might be one thing or three things you REALLY need to do.) At one place I worked I was expected to create OKRs for my own personal and professional development and I felt offended by it because it was out of phase with my own needs. Today I do a lot for personal and professional development and it is highly strategic, it's motivated by being better at what I do for work but also about getting the social opportunities I want and where I think technology is going over the next ten years. Because it is strategic I am continuously finding that a project I started a year ago has given me exactly the resource I need right now for a situation I had no idea I'd be in. Like hell I need to fill out a form in some artificial format for my boss about it.
- dvtrn 5y ago
  I think of Steven Covey's "Begin with the End in Mind". This has been a point of struggle lately in my career; I know exactly the source you’re quoting and it’s paid dividends in my own ability to deliver and manage teams when I was an engineering manager and yet I’m finding a lot of frustration lately-having intentionally gone back to working as an individual contributor-with jobs where a leader takes on a massive undertaking of a task, or decides to start picking at a particularly nasty process/business/engineering scab, making it my priority, but giving no guidance on what “done” means or looks like (aka: acceptance criteria). Even when I blatantly, directly, and simply ask. It’s difficult to know where you stand in terms of an OKR deliverable when you have a definition of “done”, but stakeholders are preventing any kind of hand-offs or closure to the project when they have a different definition of “done” but are avoidant in sharing what it is and where your deliverable comes up short. Got an open-ear and open-mind on ways to better ‘manage up’ on this tangent.
  - PaulHoule 5y ago
    You need a definition of done for your definition of done. (e.g. your requirements for the requirements they give you.) It's an essential part of integrating with a team that you are able to get good requirements. Maybe you can get them to express requirements in a way you like. In some cases I've gotten written requirements that were inadequate but developed some process like "ask a few questions", "write my own version of the requirements and send it back for approval")
    - dvtrn 5y ago
      Perhaps. My challenge probably lies in finding out what my requirements are, it sounds like. In the situation I’m dealing with presently, I don’t necessarily need this stakeholder to take any action other than make a decision on two similar options with different outcomes only they have the business authorization to make. For my part, I’ve documented, and shared documentation with the stakeholder, and had multiple sessions with them about requirements and next steps to complete this project, and asked them repeatedly if there was anything that prevented us from moving to the next step. Each time the answer is no. By every measure I’ve tried so far, it seems there’s no question marks or missing inputs from me on actually executing the next phase of this work, and the stakeholder understands the options/risks/trade offs by their own admission… Yet when I ask “then what is your decision on these two options for the next step?”, we end up going back to questions if the previous requirements have been met-which we already found a consensus that they were and the stakeholder suggesting we aren’t ready until those are met. It feels…cyclical. —- a forced analogy: it’s like you and your friend are working together to build a custom bike, your friend knows a little about bikes, but asked you for help because you really know bikes, and after you finish putting the bike together, the last thing to do is wrap up the handle bars, so you ask your friend what color grip tape they want, but they start asking you if the tires have been inflated.
      - PaulHoule 5y ago
        Unassisted, people have trouble with cycles. Cycles are why people are afraid to get lost in the wood at night. Theseus escaped the maze of the Minotaur because he had a tool to avoid cycles. You need to document cycles as soon as you notice them and be polite but firm and ready to have the same conversation over and over again, documents in hand, making it clear that there are a few difficult issues that aren't staying resolved. Sometimes you need a written and/or practiced explanation of something difficult that you or your customer have a hard time remembering. Sometimes the customer really wants things that are contradictory and that's a common situation, in the long term the contradiction is resolved, sometimes you might be in a "pick 2 out of 3 situation" and might be able to try a few different pairs of 2 you can live with. It is is one thing to be in a state of confusion that is tractless, but frequently there are a small number of persistent problems and those have to be kept on the surface.
Kalanos 5y ago
It would be nice if there was a way to quantitatively tie objectives to competitive positioning and monetization
- simonswords82 5y ago
  Is that not what KPIs are for rather than OKRs?
- tibbetts 5y ago
  It would be nice, but then you’d probably be in a pretty boring business.
simonswords82 5y ago
I kind of reject the premise of this Professor's argument. I use OKRs extensively up, down and across my business and at no point have I felt they masquerade for strategy. You set a destination for the business through the creation of a vision and then create OKRs and KPIs to measure progress towards it and perhaps more importantly provide transparency. It's simple, it just works, and I think this guy is just trying to be contrary for the sake of it.
- majormajor 5y ago
  I've worked for a couple different places now that did not "set a destination through a vision." They picked a destination as a number ("more money" or "more users" or similar) and then built OKRs from that number. There was no real strategy, just local maximization. But then what does it mean if you didn't hit your numbers? Was your progress along the right path? Are you closer to being able to hit targets next year? Those execs couldn't tell you. Hell, even if you did hit your numbers, it was hard to get any sort of answer about how that tied in to what the company wanted to do next.
- WJW 5y ago
  Let me just inject some cynism into this: no executive ever thinks their strategic initiatives are anything other than the purest form of willpower given articulate form. At all the companies I've consulted for, OKRs inevitably run into either: - Non-SMART formulated key results anywhere in the chain allow opportunistic employees and/or managers to spin tales about how they're doing great regardless of actual results. - The executive team does not publish company-wide objectives in time for downstream teams to build their own objectives upon them, so the downstream teams just do what they've been wanting to do anyway and then spin a yarn about how it fits into the company-wide objectives when (and if) they arrive. - Lack of responsibility, nothing happens if you fail to meet your KRs. Also nothing happens if you beat your stretch goals btw. - Reorganizations every six months make a year-long planning cycle meaningless in the first place. - The whole company failed the planned OKRs for the year so badly that the executive team just decided to not mention them ever again "for morale reasons". (True story) - And many more. Don't get me wrong, OKRs can be a powerful tool in small enough teams where the Principal-Agent problem is not yet rearing its head in force. But to say that it "just works" and has no problems is simply false.
jph 5y ago
For strategy, the best quick start I've seen is a strategic balanced scorecard, and it leads directly to OKRs and KPIs. Describe what your organization/project will look like, at an agreed future date, such as one year from now. 1. What are the financial highlights such as sales and investments? 2. What are the external highlights such as customers and vendors? 3. What are the internal highlights such as processes and employees? 4. What are the learning and growth areas such as research and upskilling? https://github.com/joelparkerhenderson/strategic-balanced-scorecard https://github.com/joelparkerhenderson/strategic-balanced-sc...
aa_memon 5y ago
One of the best talks on the subject I've heard by Richard Rumelt author of "Good Strategy Bad Strategy" https://youtu.be/UZrTl16hZdk https://youtu.be/UZrTl16hZdk
- shoto_io 5y ago
  Yes, I can confirm that has been the best book I have read about strategy so far.
papito 5y ago
OKR - "a way to make your team feel bad about themselves".
- hinkley 5y ago
  Institutionalized negging is something I've become more aware of over time. Powerful if evil way to control costs. Once you see it happening to you or a friend you can begin to cast backward through your memory to identify other times when the same thing was happening but you just didn't have a name for it.
- ravenstine 5y ago
  "Always room for improvement!" I'll throw quarterly & yearly performance reviews on to that pile.
WoodenChair 5y ago
This is particularly timely for me, since we covered Measure What Matters, the book mentioned in the blog post on OKRs, on an episode of our podcast that came out last weekend.[0] I think you can sum up some of this blog post as discussing the difference between strategy and tactics. OKRs are tactical objectives that help you achieve your strategic goals. Is that a fair summary? [0]: https://pnc.st/s/business-books/f97e0afe/measure-what-matters-by-john-doerr https://pnc.st/s/business-books/f97e0afe/measure-what-matter...
- phkahler 5y ago
  >> OKRs are tactical objectives that help you achieve your strategic goals. While I agree that any distinction of strategy vs tactics was missing in the blog, I think the ORKs are too high level to qualify as tactics. Tactics are directly actionable. In that light, he may be wrong about OKRs not being strategy - they just need someone to figure out the HOW for each one and then it should all come together.
  - WoodenChair 5y ago
    I guess you could call the Key Results tactics.
    - fijiaarone 5y ago
      If you're strategy as a general is to "win the war", then I suppose you can say your tactics are to "kill the enemy and avoid being killed". But I don't think it'll work.
      - iudqnolq 5y ago
        There exactly what we did, and empirically it didn't. https://www.militarytimes.com/flashpoints/2019/12/09/afghanistan-war-metrics-were-manipulated-to-highlight-battlefield-success-according-to-bombshell-wapo-report/ https://www.militarytimes.com/flashpoints/2019/12/09/afghani...
- 5y ago
deleted 5y ago
[deleted]
tibbetts 5y ago
Goals masquerading as strategy is an incredibly common problem. Good Strategy Bad Strategy is my favorite treatment of the problem. Unfortunately a lot of executives don’t like to be told they are suppose to take responsibility for strategy. Here is an article length version from the author: https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/the-perils-of-bad-strategy https://www.mckinsey.com/business-functions/strategy-and-cor...
- motoxpro 5y ago
  Such an incredible book
fijiaarone 5y ago
That puts a point on why implementors can't stand that sort of business think. A boss says "I want you to make me more money!" When you ask "How?" His answer is "Your job is at stake."
- fijiaarone 5y ago
  That leads to (and comes from?) unethical behavior.
- comfysocks 5y ago
  Reminds me of the Wells Fargo scandal. And when it all hits the fan, blame and fire the "bad apples" (low level employees), not the people who created the incentive system that turned thousands of low wage earners into "bad apples".
ravenstine 5y ago
Is there any evidence that the use of OKRs correlates with better results versus not using OKRs?
- missedthecue 5y ago
  I think that would be really hard to measure because it would be impossible to set up a scenario where all else is equal.
joncp 5y ago
https://archive.md/D9r2o https://archive.md/D9r2o
onislandtime 5y ago
Yep and Intel is doing great with their incompetent management. These management tools can only work when there is a mission, common sense, competence, team work, respect for each other, and many more attributes rarely seen in corporate America. As the author and Warren Buffet said: “I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.”
- jamesfinlayson 5y ago
  Good point - a company I worked at introduced (and later tweaked because they couldn't get it right, then later abandoned) OKRs and no one who made that decision would have known what was going on at Intel - they just saw the name of a big company and assumed it must be good.
lostdog 5y ago
Writing OKRs is useful. Strict grading of OKRs is worse than useless. During the year (or quarter), your picture of what's useful and feasible becomes more and more precise. So your OKRs that you wrote at the beginning are worse than your current knowledge of the true goals. It's really bad to cling to your old misconceptions of what was important when you wrote those OKRs. Finally, the desire to quantitative-ize every OKR is beyond harmful. Does your organization really not care about anything qualitative? Well, it shows in your products. And no, you can't measure quality by surveying your users and averaging the results.
- skeeter2020 5y ago
  I think you can even back it up further; the real value is in defining the problem statement that the OKR addresses. The resulting OKR is just one of the many paths, and measuring results against it useful for indicating your efforts but not really progress. I agree with you on the quantitative mania. I'm not that clever but even I can frame almost any bias so it's "backed up by data". If "listen to the science" is today's new religion, our "evidence-based decision" is an opinion in disguise.
- sokoloff 5y ago
  The converse problem is a variant of the Texas Sharpshooter where, as you progress through the time period, you refine your goals to be closer to what is happening in the business, much like aligning the shadow of a batted ball to the ball. Eventually, those things inevitably converge and the updated goal is always achieved. According to the green OKR report anyway. You shouldn’t stick overly stubbornly to bad goals, but any updating of goals in the time period should be carefully considered as well.
- rixed 5y ago
  > Well, it shows in your products. If it does show in the product, shouldn't there be a way to quantify it? It seems to me that the problem with OKR is that it's hard to formalise goals, the same way it's hard to formalise requirements when designing a product. Does not imply it's not desirable to do so.
  - 5y ago
jawns 5y ago
One of my issues with OKRs is the oft-repeated line that the goals should be so audacious that you should only expect to achieve about 70% of them. If you're following this advice, you are either purposefully choosing goals that you do not know how to achieve, which is a problem, or purposefully choosing goals whose achievement relies on way too many externalities over which you have little control, which is a problem. I'm not saying external factors shouldn't be considered, or that we should only set goals that are within comfortable reach. Rather, I'm saying the uncertainty should be accounted for differently. It should be baked into our goals, not treated as if it only matters at the OKR level. Imagine if you were to plan a sprint, and your story points did not factor in uncertainty at all. Then, you committed to a sprint size that also did not take into account uncertainty. But your stakeholders agreed that a 30% sprint failure rate was acceptable. Now imagine baking in uncertainty into your estimates and then committing to a sprint size you can realistically hit. Add stretch goals if you want. Doesn't that seem more sensible?
- mathewsanders 5y ago
  My interpretation of the 70% isn’t that you set 10 OKRs and it’s considered a success if you don’t achieve 3 of them. Instead it’s that you set targets in the various key results, normalize them to a 0-1 scale, and if you’ve achieved an average of 0.7 over all of the key results, then that would still be a measure of success.
- skeeter2020 5y ago
  Honest question: are you choosing "goals" that are audacious or setting key results that are audacious? We do the latter and there is deep suspicion if you are hitting 100% on your OKRs. I always thought of them as signifying direction versus destination, is this incorrect?
- sokoloff 5y ago
  > purposefully choosing goals that you do not know how to achieve, which is a problem Purposefully choosing goals that you don’t yet know how to achieve is one of the powers of OKRs; they’re not meant to be limited to project plan-style marches towards a known outcome. Take the classic YouTube “one billion hours in daily user watch time” by the end of 2016, which was about a 10x multiple over their 2012 stat. There’s no way they knew how to reach that goal, but the objective helped them to align and constantly make small decisions in support of that goal (instead of other conflicting goals, each of which could be argued to be good for Google in a different way).
Animats 5y ago
A not-mentioned problem with goals as strategy is simple. "The enemy gets a vote" on your strategy. Gen. Mattis was fond of saying this, but it's a classic military maxim. If your goals are relative to competitors, you can achieve all your intermediate goals and still fail.
cbtacy 5y ago
Given that most people (even here) confuse and conflate "Strategy" and "strategic" it's no shock that people mistake metrics for Strategy.
lahirurlt 5y ago
I've found it challenging to make sure that my team follows a sound process to explore the space of strategic options to achieve a given objective. I like to think of KRs as a mechanism to monitor and focus the execution of a selected path. KRs, alone, say very little about the quality of the strategic decision making process.
jordanpg 5y ago
The only thing I remember about OKRs during my 10 years as a software engineer is zoning out when they talked about them at some length at company meetings.
dboreham 5y ago
OKRs serve one useful purpose: if you come across someone who seems to take them seriously, then you know for sure that they're delusional/crazy and should be designed around where practical.
kristianp 5y ago
For those who, like me, aren't up on the latest "best practice": "Objectives and key results is a goal setting framework used by individuals, teams, and organizations to define measurable goals and track their outcomes. The development of OKR is generally attributed to Andrew Grove". https://en.m.wikipedia.org/wiki/OKR https://en.m.wikipedia.org/wiki/OKR
ano88888 5y ago
OKRs are definitely one of the best ways to measure. Two difficult problems to think about during implementation: 1. How to fairly evaluate whether the O is an audacious goal or not across employees. Employee A can make a truly audacious goal and employee B can make a seemingly audacious goal but actually very achievable with moderate efforts. I think it is gonna be quite difficult when you have lots of employees. 2. How do you grade people fairly ? Most companies will not be able to resist connecting your key results to commission/bonus. As a result ,employees setting truly audacious goals will be disadvantaged. If it is truly audacious, it means it has a smaller chance of success. Sooner or later, people will try to game the system if they don't want to be hurt by the system.
- ano88888 5y ago
  Why the downvotes? Did I say anything that is against the policies ? You don't need to upvote but what are the reasons for downvotes? These are genuine questions/challenges that I had when managing people's OKR. If you think they are not any problem at all, please help provide your opinions , it will greatly help me in understanding how to effectively use OKRs.
MR4D 5y ago
Title should be “The perils of bad strategy”.
da39a3ee 5y ago
In my experience, the only thing worse than an OKR meeting is an OKR meeting where the conversation turns to the nature of OKRs.
sjg007 5y ago
The problem with OKRs is that they do not capture innovation. At best they capture optimization but they can be gamed.
- sfink 5y ago
  I believe the intent is very much for OKRs to enable innovation. They certainly do not "capture" it, though, since that would require doing the innovation first and then forming OKRs around it, and the whole point (in my limited understanding) of OKRs is to set out objectives that you don't know how to accomplish. Come up with an objective, innovate in order to achieve it, keep yourself from going too far off track by tracking the results against thresholds you decided at the beginning (rather than adjusted or invented to match what's actually happening.) And somehow resist the temptation to invert the flow, where people justify what they're doing as fitting into an OKR rather than the OKR motivating their choice of what to do. (That's the part I'm getting wrong right now.)
doctor_eval 5y ago
I read this, and I thought it made some good points, but I found it Hard to Read (HTR) and difficult to follow (DTF).
- elpakal 5y ago
  I see what you did there (ISWYDT)
fhd2 5y ago
I suppose the author is - in business language - describing the problem that data driven goal setting makes an organisation chase local maxima. I definitely agree! Seen more than one company go down from this. I guess part of the issue is that established companies have a tendency of being too risk averse to dare chasing the global maximum.
- bitwize 5y ago
  It's more like companies lose sight of the what/how distinction. It's like this: Objective: End the war with the Machines Key Result: Neo is delivered to the Source so he can set us all free Q. What's missing? A. Strategy: 1) Rescue the Keymaker from the Merovingian 2) Blow up the power station and the emergency backup to disable the alarms 3) Infiltrate the building and have the Keymaker unlock the right door 4) Etc. And without that third bit you're lost. It's good to have a goal, it's good to have things you can check to see how far along you are, but you need to map out what must be done to achieve forward progress also. A lot of companies confuse the journey for the destination and set OKRs without mapping out how that may be done. Or maybe they leave the how to lower levels, who I guess set OKRs of their own and delegate the how to their subordinates, etc.? I dunno.
- potamic 5y ago
  I think they are saying a little more than that. From what I gather, they are trying to distinguish the concept of an objective from strategy. An objective is something that is desired to be achieved, something that indicates the business is running well. It is merely a target and does not specify how that target can be achieved. Strategy is what gives direction as to how a target can be reached and sort of a framework under which they can operate. I think what they are arguing is that businesses sometimes define objectives without having a strategy. In such a situation there will be a hundred different ways how the objective can be achieved but no direction on which way to pick and each pulling the business in different directions. I agree that it is quite business language heavy. My understanding could be wrong, take it as a non-business guy's interpretation.
bl4ckm0r3 5y ago
I have seen OKRs being badly implemented in different companies, the funniest things i have heard: 1. "we have easily achievable (100%) and hardly achievable (70%) okrs" where the 70% are just 100% achievable okrs + a bit that is impossible to achieve, also you HAVE to reach 70% ("70% is the new 100%") 2. "we have achieved 200% of our okr!!! <party face>" 3. "our KR is that the product needs to be at least as accurate as before" + several more acceptance criteria as KRs the problem with these approaches is that people more easily follow a checklist and don't take time to understand the principles or even just do a trial and error approach to it for the sake of moving forward, so you end up with a roadmap masked as a KPIs list with non measurable KR and people being really confused about what's going on.
wodenokoto 5y ago
36 months for an okr? Where I worked an okr was 4 months. If you are working against a goal for 3 years, no wonder it becomes your defacto strategy.

321 points by asplake 5y ago

deleted 5y ago

[deleted]

You say "Objectives and Key Results" I say "Pre-emptive Hierarchical Blamestorming" OKRs further entrench hierarchies in a way that is harmful to productivity and harmony. They allow for a whole middle layer of management that simply decomposes their KRs and passes them down. The people below them are ultimately the ones on the hook for delivering, and if the middle manager doesn't achieve their own KRs, they already have an agreement about which person that reports to them is to blame. In my organisation OKRs are being used as a sort of feudal system whereby the peasants work the land, but the credit is passed up the chain to the seigneur.

PaulHoule 5y ago

I think of Steven Covey's "Begin with the End in Mind". There really are some metrics that are strategic. But when your manager is asked to have 20 OKRs just because your manager has to have 20 OKRs and then you get asked to have 20 OKRs that is a distraction. (In terms of strategy there might be one thing or three things you REALLY need to do.) At one place I worked I was expected to create OKRs for my own personal and professional development and I felt offended by it because it was out of phase with my own needs. Today I do a lot for personal and professional development and it is highly strategic, it's motivated by being better at what I do for work but also about getting the social opportunities I want and where I think technology is going over the next ten years. Because it is strategic I am continuously finding that a project I started a year ago has given me exactly the resource I need right now for a situation I had no idea I'd be in. Like hell I need to fill out a form in some artificial format for my boss about it.

dvtrn 5y ago
I think of Steven Covey's "Begin with the End in Mind". This has been a point of struggle lately in my career; I know exactly the source you’re quoting and it’s paid dividends in my own ability to deliver and manage teams when I was an engineering manager and yet I’m finding a lot of frustration lately-having intentionally gone back to working as an individual contributor-with jobs where a leader takes on a massive undertaking of a task, or decides to start picking at a particularly nasty process/business/engineering scab, making it my priority, but giving no guidance on what “done” means or looks like (aka: acceptance criteria). Even when I blatantly, directly, and simply ask. It’s difficult to know where you stand in terms of an OKR deliverable when you have a definition of “done”, but stakeholders are preventing any kind of hand-offs or closure to the project when they have a different definition of “done” but are avoidant in sharing what it is and where your deliverable comes up short. Got an open-ear and open-mind on ways to better ‘manage up’ on this tangent.
- PaulHoule 5y ago
  You need a definition of done for your definition of done. (e.g. your requirements for the requirements they give you.) It's an essential part of integrating with a team that you are able to get good requirements. Maybe you can get them to express requirements in a way you like. In some cases I've gotten written requirements that were inadequate but developed some process like "ask a few questions", "write my own version of the requirements and send it back for approval")
  - dvtrn 5y ago
    Perhaps. My challenge probably lies in finding out what my requirements are, it sounds like. In the situation I’m dealing with presently, I don’t necessarily need this stakeholder to take any action other than make a decision on two similar options with different outcomes only they have the business authorization to make. For my part, I’ve documented, and shared documentation with the stakeholder, and had multiple sessions with them about requirements and next steps to complete this project, and asked them repeatedly if there was anything that prevented us from moving to the next step. Each time the answer is no. By every measure I’ve tried so far, it seems there’s no question marks or missing inputs from me on actually executing the next phase of this work, and the stakeholder understands the options/risks/trade offs by their own admission… Yet when I ask “then what is your decision on these two options for the next step?”, we end up going back to questions if the previous requirements have been met-which we already found a consensus that they were and the stakeholder suggesting we aren’t ready until those are met. It feels…cyclical. —- a forced analogy: it’s like you and your friend are working together to build a custom bike, your friend knows a little about bikes, but asked you for help because you really know bikes, and after you finish putting the bike together, the last thing to do is wrap up the handle bars, so you ask your friend what color grip tape they want, but they start asking you if the tires have been inflated.
    - PaulHoule 5y ago
      Unassisted, people have trouble with cycles. Cycles are why people are afraid to get lost in the wood at night. Theseus escaped the maze of the Minotaur because he had a tool to avoid cycles. You need to document cycles as soon as you notice them and be polite but firm and ready to have the same conversation over and over again, documents in hand, making it clear that there are a few difficult issues that aren't staying resolved. Sometimes you need a written and/or practiced explanation of something difficult that you or your customer have a hard time remembering. Sometimes the customer really wants things that are contradictory and that's a common situation, in the long term the contradiction is resolved, sometimes you might be in a "pick 2 out of 3 situation" and might be able to try a few different pairs of 2 you can live with. It is is one thing to be in a state of confusion that is tractless, but frequently there are a small number of persistent problems and those have to be kept on the surface.

Kalanos 5y ago

It would be nice if there was a way to quantitatively tie objectives to competitive positioning and monetization

simonswords82 5y ago
Is that not what KPIs are for rather than OKRs?
tibbetts 5y ago
It would be nice, but then you’d probably be in a pretty boring business.

simonswords82 5y ago

I kind of reject the premise of this Professor's argument. I use OKRs extensively up, down and across my business and at no point have I felt they masquerade for strategy. You set a destination for the business through the creation of a vision and then create OKRs and KPIs to measure progress towards it and perhaps more importantly provide transparency. It's simple, it just works, and I think this guy is just trying to be contrary for the sake of it.

majormajor 5y ago
I've worked for a couple different places now that did not "set a destination through a vision." They picked a destination as a number ("more money" or "more users" or similar) and then built OKRs from that number. There was no real strategy, just local maximization. But then what does it mean if you didn't hit your numbers? Was your progress along the right path? Are you closer to being able to hit targets next year? Those execs couldn't tell you. Hell, even if you did hit your numbers, it was hard to get any sort of answer about how that tied in to what the company wanted to do next.
WJW 5y ago
Let me just inject some cynism into this: no executive ever thinks their strategic initiatives are anything other than the purest form of willpower given articulate form. At all the companies I've consulted for, OKRs inevitably run into either: - Non-SMART formulated key results anywhere in the chain allow opportunistic employees and/or managers to spin tales about how they're doing great regardless of actual results. - The executive team does not publish company-wide objectives in time for downstream teams to build their own objectives upon them, so the downstream teams just do what they've been wanting to do anyway and then spin a yarn about how it fits into the company-wide objectives when (and if) they arrive. - Lack of responsibility, nothing happens if you fail to meet your KRs. Also nothing happens if you beat your stretch goals btw. - Reorganizations every six months make a year-long planning cycle meaningless in the first place. - The whole company failed the planned OKRs for the year so badly that the executive team just decided to not mention them ever again "for morale reasons". (True story) - And many more. Don't get me wrong, OKRs can be a powerful tool in small enough teams where the Principal-Agent problem is not yet rearing its head in force. But to say that it "just works" and has no problems is simply false.

jph 5y ago

For strategy, the best quick start I've seen is a strategic balanced scorecard, and it leads directly to OKRs and KPIs. Describe what your organization/project will look like, at an agreed future date, such as one year from now. 1. What are the financial highlights such as sales and investments? 2. What are the external highlights such as customers and vendors? 3. What are the internal highlights such as processes and employees? 4. What are the learning and growth areas such as research and upskilling? https://github.com/joelparkerhenderson/strategic-balanced-scorecard https://github.com/joelparkerhenderson/strategic-balanced-sc...

aa_memon 5y ago

One of the best talks on the subject I've heard by Richard Rumelt author of "Good Strategy Bad Strategy" https://youtu.be/UZrTl16hZdk https://youtu.be/UZrTl16hZdk

shoto_io 5y ago
Yes, I can confirm that has been the best book I have read about strategy so far.

papito 5y ago

OKR - "a way to make your team feel bad about themselves".

hinkley 5y ago
Institutionalized negging is something I've become more aware of over time. Powerful if evil way to control costs. Once you see it happening to you or a friend you can begin to cast backward through your memory to identify other times when the same thing was happening but you just didn't have a name for it.
ravenstine 5y ago
"Always room for improvement!" I'll throw quarterly & yearly performance reviews on to that pile.

WoodenChair 5y ago

This is particularly timely for me, since we covered Measure What Matters, the book mentioned in the blog post on OKRs, on an episode of our podcast that came out last weekend.[0] I think you can sum up some of this blog post as discussing the difference between strategy and tactics. OKRs are tactical objectives that help you achieve your strategic goals. Is that a fair summary? [0]: https://pnc.st/s/business-books/f97e0afe/measure-what-matters-by-john-doerr https://pnc.st/s/business-books/f97e0afe/measure-what-matter...

phkahler 5y ago
>> OKRs are tactical objectives that help you achieve your strategic goals. While I agree that any distinction of strategy vs tactics was missing in the blog, I think the ORKs are too high level to qualify as tactics. Tactics are directly actionable. In that light, he may be wrong about OKRs not being strategy - they just need someone to figure out the HOW for each one and then it should all come together.
- WoodenChair 5y ago
  I guess you could call the Key Results tactics.
  - fijiaarone 5y ago
    If you're strategy as a general is to "win the war", then I suppose you can say your tactics are to "kill the enemy and avoid being killed". But I don't think it'll work.
    - iudqnolq 5y ago
      There exactly what we did, and empirically it didn't. https://www.militarytimes.com/flashpoints/2019/12/09/afghanistan-war-metrics-were-manipulated-to-highlight-battlefield-success-according-to-bombshell-wapo-report/ https://www.militarytimes.com/flashpoints/2019/12/09/afghani...
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tibbetts 5y ago

Goals masquerading as strategy is an incredibly common problem. Good Strategy Bad Strategy is my favorite treatment of the problem. Unfortunately a lot of executives don’t like to be told they are suppose to take responsibility for strategy. Here is an article length version from the author: https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/the-perils-of-bad-strategy https://www.mckinsey.com/business-functions/strategy-and-cor...

motoxpro 5y ago
Such an incredible book

fijiaarone 5y ago

That puts a point on why implementors can't stand that sort of business think. A boss says "I want you to make me more money!" When you ask "How?" His answer is "Your job is at stake."

fijiaarone 5y ago
That leads to (and comes from?) unethical behavior.
comfysocks 5y ago
Reminds me of the Wells Fargo scandal. And when it all hits the fan, blame and fire the "bad apples" (low level employees), not the people who created the incentive system that turned thousands of low wage earners into "bad apples".

ravenstine 5y ago

Is there any evidence that the use of OKRs correlates with better results versus not using OKRs?

missedthecue 5y ago
I think that would be really hard to measure because it would be impossible to set up a scenario where all else is equal.

joncp 5y ago

https://archive.md/D9r2o https://archive.md/D9r2o

onislandtime 5y ago

Yep and Intel is doing great with their incompetent management. These management tools can only work when there is a mission, common sense, competence, team work, respect for each other, and many more attributes rarely seen in corporate America. As the author and Warren Buffet said: “I try to invest in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.”

jamesfinlayson 5y ago
Good point - a company I worked at introduced (and later tweaked because they couldn't get it right, then later abandoned) OKRs and no one who made that decision would have known what was going on at Intel - they just saw the name of a big company and assumed it must be good.

lostdog 5y ago

Writing OKRs is useful. Strict grading of OKRs is worse than useless. During the year (or quarter), your picture of what's useful and feasible becomes more and more precise. So your OKRs that you wrote at the beginning are worse than your current knowledge of the true goals. It's really bad to cling to your old misconceptions of what was important when you wrote those OKRs. Finally, the desire to quantitative-ize every OKR is beyond harmful. Does your organization really not care about anything qualitative? Well, it shows in your products. And no, you can't measure quality by surveying your users and averaging the results.

skeeter2020 5y ago
I think you can even back it up further; the real value is in defining the problem statement that the OKR addresses. The resulting OKR is just one of the many paths, and measuring results against it useful for indicating your efforts but not really progress. I agree with you on the quantitative mania. I'm not that clever but even I can frame almost any bias so it's "backed up by data". If "listen to the science" is today's new religion, our "evidence-based decision" is an opinion in disguise.
sokoloff 5y ago
The converse problem is a variant of the Texas Sharpshooter where, as you progress through the time period, you refine your goals to be closer to what is happening in the business, much like aligning the shadow of a batted ball to the ball. Eventually, those things inevitably converge and the updated goal is always achieved. According to the green OKR report anyway. You shouldn’t stick overly stubbornly to bad goals, but any updating of goals in the time period should be carefully considered as well.
rixed 5y ago
> Well, it shows in your products. If it does show in the product, shouldn't there be a way to quantify it? It seems to me that the problem with OKR is that it's hard to formalise goals, the same way it's hard to formalise requirements when designing a product. Does not imply it's not desirable to do so.
- 5y ago

jawns 5y ago

One of my issues with OKRs is the oft-repeated line that the goals should be so audacious that you should only expect to achieve about 70% of them. If you're following this advice, you are either purposefully choosing goals that you do not know how to achieve, which is a problem, or purposefully choosing goals whose achievement relies on way too many externalities over which you have little control, which is a problem. I'm not saying external factors shouldn't be considered, or that we should only set goals that are within comfortable reach. Rather, I'm saying the uncertainty should be accounted for differently. It should be baked into our goals, not treated as if it only matters at the OKR level. Imagine if you were to plan a sprint, and your story points did not factor in uncertainty at all. Then, you committed to a sprint size that also did not take into account uncertainty. But your stakeholders agreed that a 30% sprint failure rate was acceptable. Now imagine baking in uncertainty into your estimates and then committing to a sprint size you can realistically hit. Add stretch goals if you want. Doesn't that seem more sensible?

mathewsanders 5y ago
My interpretation of the 70% isn’t that you set 10 OKRs and it’s considered a success if you don’t achieve 3 of them. Instead it’s that you set targets in the various key results, normalize them to a 0-1 scale, and if you’ve achieved an average of 0.7 over all of the key results, then that would still be a measure of success.
skeeter2020 5y ago
Honest question: are you choosing "goals" that are audacious or setting key results that are audacious? We do the latter and there is deep suspicion if you are hitting 100% on your OKRs. I always thought of them as signifying direction versus destination, is this incorrect?
sokoloff 5y ago
> purposefully choosing goals that you do not know how to achieve, which is a problem Purposefully choosing goals that you don’t yet know how to achieve is one of the powers of OKRs; they’re not meant to be limited to project plan-style marches towards a known outcome. Take the classic YouTube “one billion hours in daily user watch time” by the end of 2016, which was about a 10x multiple over their 2012 stat. There’s no way they knew how to reach that goal, but the objective helped them to align and constantly make small decisions in support of that goal (instead of other conflicting goals, each of which could be argued to be good for Google in a different way).

Animats 5y ago

A not-mentioned problem with goals as strategy is simple. "The enemy gets a vote" on your strategy. Gen. Mattis was fond of saying this, but it's a classic military maxim. If your goals are relative to competitors, you can achieve all your intermediate goals and still fail.

cbtacy 5y ago

Given that most people (even here) confuse and conflate "Strategy" and "strategic" it's no shock that people mistake metrics for Strategy.

lahirurlt 5y ago

I've found it challenging to make sure that my team follows a sound process to explore the space of strategic options to achieve a given objective. I like to think of KRs as a mechanism to monitor and focus the execution of a selected path. KRs, alone, say very little about the quality of the strategic decision making process.

jordanpg 5y ago

The only thing I remember about OKRs during my 10 years as a software engineer is zoning out when they talked about them at some length at company meetings.

dboreham 5y ago

OKRs serve one useful purpose: if you come across someone who seems to take them seriously, then you know for sure that they're delusional/crazy and should be designed around where practical.

kristianp 5y ago

For those who, like me, aren't up on the latest "best practice": "Objectives and key results is a goal setting framework used by individuals, teams, and organizations to define measurable goals and track their outcomes. The development of OKR is generally attributed to Andrew Grove". https://en.m.wikipedia.org/wiki/OKR https://en.m.wikipedia.org/wiki/OKR

ano88888 5y ago

OKRs are definitely one of the best ways to measure. Two difficult problems to think about during implementation: 1. How to fairly evaluate whether the O is an audacious goal or not across employees. Employee A can make a truly audacious goal and employee B can make a seemingly audacious goal but actually very achievable with moderate efforts. I think it is gonna be quite difficult when you have lots of employees. 2. How do you grade people fairly ? Most companies will not be able to resist connecting your key results to commission/bonus. As a result ,employees setting truly audacious goals will be disadvantaged. If it is truly audacious, it means it has a smaller chance of success. Sooner or later, people will try to game the system if they don't want to be hurt by the system.

ano88888 5y ago
Why the downvotes? Did I say anything that is against the policies ? You don't need to upvote but what are the reasons for downvotes? These are genuine questions/challenges that I had when managing people's OKR. If you think they are not any problem at all, please help provide your opinions , it will greatly help me in understanding how to effectively use OKRs.

MR4D 5y ago

Title should be “The perils of bad strategy”.

da39a3ee 5y ago

In my experience, the only thing worse than an OKR meeting is an OKR meeting where the conversation turns to the nature of OKRs.

sjg007 5y ago

The problem with OKRs is that they do not capture innovation. At best they capture optimization but they can be gamed.

sfink 5y ago
I believe the intent is very much for OKRs to enable innovation. They certainly do not "capture" it, though, since that would require doing the innovation first and then forming OKRs around it, and the whole point (in my limited understanding) of OKRs is to set out objectives that you don't know how to accomplish. Come up with an objective, innovate in order to achieve it, keep yourself from going too far off track by tracking the results against thresholds you decided at the beginning (rather than adjusted or invented to match what's actually happening.) And somehow resist the temptation to invert the flow, where people justify what they're doing as fitting into an OKR rather than the OKR motivating their choice of what to do. (That's the part I'm getting wrong right now.)

doctor_eval 5y ago

I read this, and I thought it made some good points, but I found it Hard to Read (HTR) and difficult to follow (DTF).

elpakal 5y ago
I see what you did there (ISWYDT)

fhd2 5y ago

I suppose the author is - in business language - describing the problem that data driven goal setting makes an organisation chase local maxima. I definitely agree! Seen more than one company go down from this. I guess part of the issue is that established companies have a tendency of being too risk averse to dare chasing the global maximum.

bitwize 5y ago
It's more like companies lose sight of the what/how distinction. It's like this: Objective: End the war with the Machines Key Result: Neo is delivered to the Source so he can set us all free Q. What's missing? A. Strategy: 1) Rescue the Keymaker from the Merovingian 2) Blow up the power station and the emergency backup to disable the alarms 3) Infiltrate the building and have the Keymaker unlock the right door 4) Etc. And without that third bit you're lost. It's good to have a goal, it's good to have things you can check to see how far along you are, but you need to map out what must be done to achieve forward progress also. A lot of companies confuse the journey for the destination and set OKRs without mapping out how that may be done. Or maybe they leave the how to lower levels, who I guess set OKRs of their own and delegate the how to their subordinates, etc.? I dunno.
potamic 5y ago
I think they are saying a little more than that. From what I gather, they are trying to distinguish the concept of an objective from strategy. An objective is something that is desired to be achieved, something that indicates the business is running well. It is merely a target and does not specify how that target can be achieved. Strategy is what gives direction as to how a target can be reached and sort of a framework under which they can operate. I think what they are arguing is that businesses sometimes define objectives without having a strategy. In such a situation there will be a hundred different ways how the objective can be achieved but no direction on which way to pick and each pulling the business in different directions. I agree that it is quite business language heavy. My understanding could be wrong, take it as a non-business guy's interpretation.

bl4ckm0r3 5y ago

I have seen OKRs being badly implemented in different companies, the funniest things i have heard: 1. "we have easily achievable (100%) and hardly achievable (70%) okrs" where the 70% are just 100% achievable okrs + a bit that is impossible to achieve, also you HAVE to reach 70% ("70% is the new 100%") 2. "we have achieved 200% of our okr!!! <party face>" 3. "our KR is that the product needs to be at least as accurate as before" + several more acceptance criteria as KRs the problem with these approaches is that people more easily follow a checklist and don't take time to understand the principles or even just do a trial and error approach to it for the sake of moving forward, so you end up with a roadmap masked as a KPIs list with non measurable KR and people being really confused about what's going on.

wodenokoto 5y ago

36 months for an okr? Where I worked an okr was 4 months. If you are working against a goal for 3 years, no wonder it becomes your defacto strategy.