Part 2: Creating OKRs
This is part 2 of a 2-part post on OKRs. Find part 1 here.
One of the things that often confuses product teams about OKRs is taking the O and the KRs out of context. The product team’s objective exists within the context of a broader product vision, company vision, a set of business objectives, and a product strategy. The KRs (measurable outcomes) do not deliver themselves - process goals (SMART goals) are needed to deliver on the key results.
Let’s standardise on five terms to describe our goals and objectives:
- Dream Goal (vision and purpose that leads to self-actualisation and transcendence). Owned by the founders (early stage) or management team (later-stage).
- End Goal(s) (unambiguous targets, your Olympic gold, can be out of your control). Owned jointly between product teams and founders/management team, end-goals map to stages on your product strategy.
- Performance Goals / OKR Objectives (Unambiguous statements of what you are going to achieve, that are >98% under your control). Owned jointly between product teams and founders/management team.
- OKR Key Results (Measurable milestones, outcomes, not activities, include evidence of completion). Owned by product teams.
- Process Goals (the SMART actions you are going to take to get to your goals). Owned by product teams.
Here’s a practical examples
Here’s a made-up example applying to a fictional product team for their Q4 OKRs:
- Dream Goal: Drivers fall in love with the serene experience their car brings them and their commute becomes a pleasure.
- End Goal(s): Test car powered by us attains a 90% NPS score.
- Performance Goals / OKR Objectives: Q3: A new UX for feature A that delights users.
- OKR Key Result(s):
- Understand users’ pain points relating to feature A
- Reduce the average number of clicks per journey to 3 from 6 in feature A
- Share results with customers, sales, and stakeholders
- Process Goals (the SMART actions you are going to take to get to your goals)
- Conduct user interviews to understand major pain points
- Run experiments to determine what the major contributor to NPS is
- Get an MVP within 4 weeks
- Get MVP to customers
- etc etc
Questions for product teams to ask when setting OKRs
If you are a product manager, ask yourself these questions when setting your OKRs:
- Are you 100% sure that your manager/team lead/head of product agrees with your objectives? Is there any room for misinterpretation?
- Not sure - talk to your manager immediately and get aligned.
- Wiggle room - consider finding an independent person in your company who can help you decide if you objective is tangible and unambiguous.
- Is this objective >98% under my / our control?
- If no, what can we do to bring it under our control?
- If still no, go back to your manager/team lead and get a different objective
- Is this objective / are these key results outcome-based?
- If no, what can you do to make them outcome-based?
- Consider creating a process column and dump all non-outcome based KRs into this space
- If you are a product manager, what do your team think of the key results?
- If you are not sure, talk to them and listen!
- If they are unsure about them, find out why they are unsure and try to resolve it.
- If they have not seen the key results, this is a problem. You want your team to feel strong ownership of the outcomes they are delivering.
I hope this all helped. I would love your feedback about:
- When you try to set OKRs in this way, what happens?
- Do you have any better examples?
- What would be useful to add?
References and inspiration
My thinking on this topic has been guided by many people who have kindly given their time, and many different studies and books. Here are a few:
- Coaching for Performance and the training by the wonderful people at Performance Consultants
- Scott Barry Kaufman - his latest book Transcend and his sail-boat metaphor.
- The Trillion Dollar Coach - the story of Bill Campbell that includes many insights into Google’s product culture.
- A whole host of people who I have talked to including Pete Bulley, Lars Corneliussen, Conor Murphy, Robyn McGirl, Meslissa Siah, Andy Crump and many more.
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