Objectives and Key Results The best practice of setting and communicating company, team and employee objectives and measuring their progress based on achieved results.

Objectives: Key Results: • ambitious • measurable and quantifiable Company • qualitative • make the objective achievable Team • time bound • lead to objective grading • actionable by the team • difficult, but not impossible Personal "It's not a key result unless it has a number." Marissa Mayer

Implementing OKR’s: Results can be based on 1) List ~3 objectives you want to strive for on each level. 2) For each objective, list 3-4 key results to be achieved. Growth 3) Communicate objectives and key results to everyone. Performance 4) People regularly update each result on a 0-100% scale. Revenue 5) When objective’s results reach 70-80%, consider it done. 6) Review OKR’s regularly and set new ones. Engagement # Best Practices

3 3 objectives at key results Set quarterly any time per objective   70% Reviewed Public and online Sweet spot to monthly or weekly in front of all achieve % of employees the results # Examples of good OKR’s

Increase our recurring Improve internal Implement user-testing revenue employee engagement process

• The share of monthly sub- • Average weekly satisfaction • Conduct at least 4 face to scriptions increased to 85% score of at least 4.8 points face testing sessions per week • Average subscription size of • Conduct weekly Fun Fridays • Receive at least 15 video at least $295 per month all-hands meetings with an interviews per month from Us- external speaker ertesting.com • Reduce churn to less than 1% monthly • Implement OKR’s in all teams • Make sure at least 80% of and departments by January people interviewed are from 31st our core target group (Direc- tors, VP’s, CEO’s) # History

First developed and implemented by , President, at . 1970’s Andy Grove’s introduction to OKR’s in “High Output Management”:

Where do I want to go? 1999 How will I know I’m getting there?

Popularized by John Doerr, VC at Caufield & Byers to his portfolio 2014+ companies. In 1999 told Larry, Sergey and team at to implement it. Used at Google successfully to this day. # Famous Users 14% 58% 13% 47%

employees understand employees say their of workers feel are satisfied with their their company’s manager clearly engaged by their organization’s system for strategy and direction communicates goals and jobs managing their objectives performance * Goals must be supported by the entire organization. * Goals must be measurable or have quantifiable targets. * Goals should be aggressive yet realistic. “ John Doerr

“We put the whole company on that, so everyone knows their O.K.R.’s. And that is a good, simple organizing prin- ciple that keeps people focused on the three things that matter — not the 10.” “ Mark Pincus CEO of Zynga

In an organization of 1000 employees, moving a workforce from low$ to high engagement $ can have$ an impact of over $4.2 mln OKRs should become more important the more senior an employee becomes. When you’re in a leadership position, “You are sending the signal to the rest of the organiza- tion that ‘this matters,’” Weiner says. Jeff Weiner “ CEO of Linkedin

“The right way to look at OKRs is a way to communicate so there’s clarity of purpose.” “Having public goals forces different types of thinking around how people ask for help from others,” Davis says. “OKRs are not designed to be used as a weapon against your employees,” he says. “They are a tool for motivating and aligning people to work together. They increase transparency, accountability and empowerment." “ Angus Davis CEO of Swipely OKR Objective Key Results - @jhoff John Doerr originally presented OKR to Google’s leadership team in 1999. It has been used by the company ever since. This Deck Objective: Teach you OKR Key Results ● Show Example Use Case ● Highlight Benefits ● Provide links to additional resources Football GM Objective: Make money for Owners Key Results ● Win Super Bowl ● Fill Stands to 88% Head Coach Public Relations Objective: Win Super Bowl Objective: Fill Stands to 88% Key Results Key Results ● 200 Yd passing ● Hire 2 Colorful players ● No. 3 in defense stats ● Highlight Key Players ● avg 25 yd punt return Defense Offense Special Teams News Staff Scout Objective: #3 in Defense Objective: 200 yd Objective: Highlight Colorful Objective: 25yd punt return Objective: Highlight Key Players Key Results passing Players Key Results Key Results ● less than 100 Key Results Key Results ● Team Blockers ● 3 Sunday Featured yds passing ● 75% completion ● Visit to a College Articles Football GM Objective: Make money for Owners Key Results ● Win Super Bowl ● Fill Stands to 88%

Head Coach Public Relations Objective: Win Super Bowl Objective: Fill Stands to 88% Key Results Key Results ● 200 Yd passing ● Hire 2 Colorful players ● No. 3 in defense stats ● Highlight Key Players ● avg 25 yd punt return

Defense Offense Special Teams News Staff Scout Objective: #3 in Defense Objective: 200 yd Objective: 25yd punt return Objective: Highlight Key Players Objective: Highlight Colorful passing Players Key Results Key Results Key Results Key Results Key Results ● less than 100 ● Team Blockers ● 3 Sunday Featured yds passing ● 75% completion Articles ● Visit to a College Benefits

● Disciplines Thinking ( The Major Goals Will Surface )

● Communicates Accurately ( Lets everyone know what is important )

● Establishes Indicators for Measuring Progress ( shows how far along we are )

● Focuses Effort ( Keeps Organizations In step with each other ) Links

● Startup Lab workshop: How Google sets goals

● How Google sets Goals: OKRs

● Differences between OKR & KPI

● Objective and Key Result

What is Objective. What is Key Result.

Yin and yang of goal setting.

Principle and practice.

Vision and execution.

Objectives are the stuff of inspiration and far horizons, while Key Result are more earthbound and metric-driven. OKR system is a tool. Not a weapon.

It is meant to pace a person, but to put stopwatch in his own hand, so he can gauge his performance.

It is not legal document upon which to base a performance review.

They’re meant to be guardrails, not chains or blinders.

To make us excited about coming to work every day. A study:

In a recent survey of one thousand working adults, 92 percent said they’d be more motivated to reach their goals if colleagues could see their progress. A study:

Frontline employees thrive when they can see how their work aligns to the company overall goals Transparency and Collaboration

Transparency seeds collaboration. Say, an employee is struggling to reach a quarterly objective. Because she has publicly tracked her progress, colleagues can see that she needs help. They jump in, posting comments and offering support.

Transparency also seeds meritocracy. When people write down ‘This is what i’m working on,’ its easier to see where the best ideas are coming from. Soon, it’s apparent that the individual moving up are the ones doing what the company most values. Organizational poisons, suspicion, sandbagging, politicking, loses their toxic power. Company objective are closed to debate

But their key results can continue to be negotiated

Key result also can be modified or even discarded mid-cycle if it no longer practical or relevant An objective might jump from CEO straight to manager, or from a director to an individual contributor.

Or the company leadership might present its OKR to everyone at once and trust people to say “Okay, now i see where we’re going, and i’ll adapt my goals to that”.

Or a contributor might not align with a direct manager’s OKR, but she align with the General Manager overarching objectives. Individual contributor should be encouraged to create half of their own OKR, in consultation with manager Ninety minutes of a manager’s time can enhance the quality of your subordinate’s work for two weeks Each objective should be tied to < 5 key result. If objective is well framed, then 3-5 KR will usually adequate to reach it Writing Key Result To safeguard quality while pushing for quantitative deliverables, one solution is to pair key results with numbers to measure both effect and counter-effect Weak Average Strong

Objective: Win the Indy 500 Objective: Win the Indy 500 Objective: Win the Indy 500

Key Result: Increase lap speed Key Result: Increase average lap Key Result: Increase average lap speed by 2 percent. speed by 2 percent

Key Result: Test at wind tunnel ten times

Key Result: Reduce pit stop time Key Result: Reduce average pit Key Result: Reduce average pit stop time by one second stop time by one second

Key Result: Reduce pit stop errors by 50 percent

Key Result: Practice pit stops one hour per day Two type of Objective

Operational Objective must be met in full

Aspirational Objective should be uncomfortable and possibly unattainable. Eg: Google Moonshot Culture Stretch Goal (Aspirational Objective)

Google is propelled by their moonshot culture. When you aim for stars, you may come up short, but still reach the moon. It is called as the gospel of 10x.

Consider . Before it came, the mail server storage was 2-4 megabyte. Then Google leader consider offering 100MB of storage. But by 2004, when the product released, they instead provide a full gigabyte storage. And since then, digital communication changed forever.

This type of goal was named Big Hairy Audacious Goal (BHAG). In Google, aspirational OKR are set at 60 to 70 percent attainment. Encouraging a Stretch Goal

Leader need to challenge team without making them feeling that the goal is unattainable. A stretch goal cannot seem like a long march to nowhere.

Hence comes The Art of Framing.

Youtube used to set a four year OKR during 2012, where at 2016, they must reach a billion hour daily watch time, represented 10x increase to their watch time. While one billion daily hours sounded awfully lot, it represented less than 20 percent of the world total television watch time. Introducing context is helpful and clarifying.

Their billion hours of daily watch time gave the tech people a North Star OKR Check-ins

Check-in is activity where contributor report their progress to grade their OKR. Google benchmark check-in cycle is monthly. Real-time dashboard will be needed to display the progress to each stakeholder in the company.

In Google, 70 percent (0.7) achievement was considered a success.

Green zone = 0.7 to 1.0

Yellow zone = 0.4 to 0.6

Red zone = 0.0 to 0.3 In Google early years, set aside two days per quarter to personally scrutinize the OKRs of each and every software engineer OKR Dependencies

Google: Each quarter our department head presented their goals and identified dependencies OKR Wrap-up at the end of cycles

Are retrospective and forward looking at the same time. An unfinished objective might be rolled over to the next quarter, with a fresh set of key results.

OKR do not expire with completion of work. Tremendous value can be gained from post hoc evaluation and analysis.

In scoring OKR, we mark what we’ve achieved and address how might we do it differently next time.

There are no judgement, only learning.

Most important: Throw a party at the end of cycle to celebrate. What to do, to adopt OKR? OKR require a public commitment by leadership.

For organizational-level OKRs, the buck stops with senior leadership. They must personally commit to the process. You need the leader to embrace the process and lieutenant to ride herd over scoring and reviews.

When you’re the CEO or the founder of a company, you’ve got to say ‘This is what we’re doing’ and then you have to model it. Because if you don’t model it, no one’s going to do it.

People need more than milestones for motivation. They are thirsting for meaning, to understand how their goals relate to the mission. CFR (Conversations, Feedback & Recognition) Because OKR is not silver bullet, they cannot replace strong leadership, judgement, or creative culture There will be late adopters, resisters, and garden-variety procrastinator. A best practice is to designate one or more OKR shepherds By applying OKR, we’ll change our way to communicate. Instead of “What the hell, can you hurry up and get shits done? I’ve been waiting forever”, you can replace with “My KR is at risk”, which is less aggressive but also more constructive We don’t hire smart people to tell them what to do. We hire smart people so they can tell us what to do. -