ANSWERS TO QUESTIONS FROM THE INTRODUCTION

Think of the brief answers to the questions from the introduction as a preview of the ongoing discussions we hope to have with you on the OKRs Coach Network discussion board.

1. How can we scale OKRs across a large organization with hundreds of departments? Google is a massive organization and is the most well‐known company that uses OKRs today. However, the success at Google does not help answer this question. Google started using OKRs back when they had just under 40 employees on staff. The real question we want to address is, “Can a large company introduce OKRs, and how best can they deploy the system?” Zalando, FlipKart, and Sears Holding Company are three well‐documented case studies that prove it's possible to deploy OKRs on a massive scale.¹

Mantra: The crawl‐walk‐run mantra is critical when scaling OKRs at large organizations. Take a phased approach by deploying OKRs within a specific area before attempting to scale OKRs. In this way, you apply learnings along the way. You nail it before you scale it.

Analysis: Zalando's phased approach worked well. Zalando, a company of about 7,000 employees at the time, dedicated a full year to get OKRs working within their Brand Solutions group. After completing a successful OKRs program within this one group, Zalando introduced OKRs at the company and business unit levels. Finally, Zalando rolled out OKRs at the team level. My experience with Zalando as their external OKRs coach suggests that their systematic rollout was one of the keys to their success with OKRs.

Sears and FlipKart have well over 25,000 employees. Both deployed OKRs at the team level much more quickly than Zalando. Rapid deployments in massive organizations are challenging. However, both Sears and Flipkart had mandates from leadership to deploy OKRs across the entire company on a fast track. Niket Desai, the OKRs project lead at FlipKart, offers the following tip for OKRs coaches based on his experience: “Start at the highest level and slowly go down levels for OKRs instead of all at once.”

Often, a large company will only deploy OKRs within certain areas of their business. Several of our larger clients such as Capital One, Nike, and Walmart, leverage OKRs within certain divisions and teams, but do not define OKRs across their entire organization.

2. How can we set team‐level OKRs to ensure cross‐functional alignment rather than simply using the org chart to define the teams that will set OKRs? Unfortunately, there is no succinct and definitive answer to this question. We recommend reading and rereading Chapter 3 and focusing on the first deployment parameter.

Mantras: The crawl‐walk‐run and less is more mantras are critical here. Begin with a small set of teams and define a small number of OKRs to explore what works best for your client. Provide your client with options and consider piloting cross‐functional teams after completing your first cycle.

3. How can infrastructure teams such as legal, human resources, and finance benefit from OKRs? Infrastructure teams often benefit by defining OKRs for their team when they are focused on internal improvement. For example, we've seen finance teams benefit from OKRs by defining their team's objective as “streamline repetitive processes to free up more time for analysis” with key results like “reduce average time to close the books each month from two weeks to one.”

Many infrastructure teams do not find it valuable to develop OKRs for their own team. However, these same teams often benefit from OKRs by participating in OKRs drafting sessions with their key stakeholders. For example, a legal team may identify the sales team as a key stakeholder for the upcoming OKRs cycle. The legal team may provide input that informs the sales team's OKRs. In doing so, the legal team might even add a name from legal to co‐champion a sales team's key result to address a critical dependency.

4. How do we integrate OKRs into our performance management system? As an OKRs coach, you help your client discover their answer. If your client has a performance management system, review the content from the seventh deployment parameter in Chapter 3 with your OKRs project and HR leads. Here are two principles:

• Do include OKRs in performance review discussions via structured questions to position managers as coaches.
• Do not use scores on key results as the basis for calculating incentive compensation.

5. How do OKRs compare with KPIs? Each organization must find their own answer to this question. We often allocate an entire deployment coaching session to address this topic with our clients in Phase 1. An analysis detailing how OKRs compare with KPIs is covered in the eighth deployment parameter in Chapter 3. We recommend working with each client to design a table based on the comparison of key results and KPIs as shown in Figure 3.5.

6. When do OKRs not add value? In our experience, OKRs do not always add value. Let's explore this question from both the company and team level.

Analysis for company level: OKRs do not add value at the company level when the organization is in maintenance mode. Here is a personal story to make this concrete. I live just an hour away from Napa Valley in California. So, it should come as no surprise that I've been asked to present OKRs to a family‐run winery. The winery was hitting about $10 million in annual sales and making a small profit each year. Over a glass of wine, the executive team and I reviewed the mission and set some objectives. However, the OKRs we drafted all looked like “health metrics.” That is, we did not want to grow the business. We simply wanted to keep things the way they were.

As OKRs are about focusing on areas to make measurable improvement, we concluded that an OKRs deployment would not be a good fit for the winery. Then, we uncorked a couple bottles and celebrated. After all, we were quickly able to make the decision not to do OKRs, so why not celebrate that success? This was one of my most successful “nonclient” case studies, as we avoided wasting time setting OKRs and the wine was excellent.

Analysis for team level: It is often challenging to know whether OKRs will be effective for a given team. In fact, one of my larger tech clients based in the Silicon Valley asked us to conduct a one‐year pilot program with five newly formed teams that were in discovery mode. Midway through the pilot, our client decided that only one of the five teams would continue with OKRs. Their key results looked like “hire staff” and “run experiments.” This pilot program led to the following two insights about when teams should avoid OKRs:

1. Team is not yet formed. You know this is a problem when all key results look like “Hire the team as measured by filling X positions by end of period.” This is more of a task than a key result.
2. Team is purely in discovery mode. You know this is a problem when all OKRs look like “run experiments” or “test the market.” It's difficult to increase metric A from X to Y when we don't know what metric A should be in the first place!

We find these two insights apply to other organizations as well. Thus, we advise you to be wary of defining team‐level OKRs if a team is not yet formed or is purely in discovery mode.

7. How do we ensure that OKRs reflect team thinking rather than orders from the boss? Most objectives are set by leadership. Most key results are defined by team members. We recommend that teams avoid the temptation to define team‐level OKRs by simply copying and pasting from higher‐level OKRs. Refer to the ninth and tenth deployment parameters from Chapter 3 for more.

8. How do we avoid OKRs that look like a “to‐do list”? Writing OKRs as a to‐do list is a common pitfall that teams encounter when defining OKRs. Drafting OKRs that look like a to‐do list is not necessarily a bad thing. However, publishing OKRs that look like a to‐do list misses the point. While some coaches solve this problem by requiring every key result be defined as a metric, we do not advise you to completely abandon milestone key results. Milestones can be effective in some cases as detailed in the fifth deployment parameter of Chapter 3.

As an OKRs coach, you ask questions to help your client translate draft key results that often look a list of tasks into effective key results. You guide your client through a series of questions to design effective key results that reflect measurable outcomes. You ask the fundamental task‐to‐key‐result question: “What is the intended outcome of the task?” To help your client avoid key results that look like a to‐do list, review the seven steps for creating team‐level OKRs in Chapter 5 and the examples of ineffective and effective key results described in Figure E.1 of the Epilogue.

9. What if some employees do not see how they contribute to company‐level OKRs? If your client asks you this question, get to the underlying concern. Is the concern that leadership wants everyone to feel their work is valued? If so, remind your client that OKRs are not meant to capture all important work across the organization.

Leadership teams that want to capture all important work often present a broader framework as context for OKRs. For example, they may present collectively exhausted categories such as the four perspectives of a balanced scorecard.

We've also seen organizations communicate OKRs in conjunction with health metrics. By reviewing health metrics and OKRs, employees should be able to connect their work to the bigger picture. They should be able to see how their efforts maintain a health metric or move a key result forward. Kuang Yang's contribution at the end of Chapter 3 illustrates how Huawei allows employees to connect their work to both health metrics and OKRs.

To monitor how they connect their work to top‐level OKRs, employees often incorporate OKRs into 1:1s with their managers. Some employees may be perfectly fine working on projects that do not connect to company‐level OKRs. Perhaps they are focused on maintaining health metrics or completing compliance activities. Other employees may feel a need to contribute to company‐level OKRs and therefore may need to adjust their priorities or even their role within the organization to be engaged at work.

10. How do I facilitate an executive workshop to draft top‐level OKRs? As with all workshops, be sure to design a structured agenda and run it by the OKRs project lead and executive sponsor. Be ready to depart from the planned agenda as illustrated by the ACME Homes case study. For this case study along with a playbook to help you design, prepare, and facilitate an executive workshop to draft top‐level OKRs, refer to the first application section of Chapter 4.

THE FIVE OKRs COACHING MANTRAS

We've embedded five mantras into this book. They are based on our collective coaching experience with hundreds of organizations. Organizations that follow these mantras consistently experience more success with OKRs than those that do not. Here is each mantra with a brief description:

1. Less is more. Define a small set of OKRs.
2. Crawl‐walk‐run. Deploy OKRs piecemeal. Begin with pilot teams rather than a full‐scale deployment across an entire organization.
3. Outcomes, not output. Write key results that mostly reflect outcomes (results) rather than output (amount of work delivered).
4. OKRs are not everything. Write OKRs that reflect the most important areas to make measurable progress rather than attempting to reflect everything you do. Distinguish OKRs from tasks and health metrics.
5. The only way to learn OKRs is to do OKRs. Allocate most of an OKRs training workshop to drafting your client's real OKRs rather than discussing theory and presenting OKRs from other organizations.

We hope that you live by these mantras. Incorporate them into every OKRs coaching engagement and you are on the path to success!