Measure What Matters

Measure What Matters is a book about setting Objectives and Key Results (OKRs for short) by John Doerr. It is also a book about stories from Silicon Valley on how successful companies and charities used OKRs to succeed.

Generally speaking, OKRs is a management methodology, so I was a bit skeptical when I heard about it for the first time. I was expecting a few jargons for things that we know already, but just rephrased in a different/fancy way. And when my manager recommended this book, I was surprised that the author needed over 300 pages to talk about goal-setting. Should have been a long blogpost maybe!

But here is the deal: the author is a venture capitalist who had a first-hand experience with OKRs, working with Andy Grove (the father of OKRs) at Intel back in the 1970s, advocating for it since then and helping tech giants to succeed. And the book set the scene in each chapter by telling stories from the founders of a few shiny names (Intel, Google, Bill & Melinda Gates Foundation and more) about how they used it, and how it impacted their organizations.

That might set some people off, specially if you’re expecting a practical/how-to guide (that comes in the appendix), but for me, that was the best part of the deal: inspiring, sometimes nostalgic stories about many successful products that we know like Chrome, Youtube, Intel x86, MyFitnessPal, and others, hearing what happened behind the scenes before it became news for us!

The Book in Two Minutes or Less

An Objective is simply what is to be achieved (the direction), and Key Results are the benchmark and monitor to get to the objective. Objectives are significant, concrete, action oriented and inspirational, and key results are specific, measurable, time-bounded, verifiable and often aggressive.

Example of OKRs for key milestone in Youtube’s history

And the rule is simple: if all key results are accomplished, then the objectives should be completed, and you either meet a key result’s requirements or you don’t; there is no gray area!

OKRs give the organization clear, quantitative targets on the road, and in contrast to the conventional management methods, OKRs are action oriented, and it encourage a mix of bottom-up and top-down goal-setting. OKRs are inherently work in progress, not commandments chiseled in stone. And the promise of using OKRs is bringing clarity, accountability, efficiency and unity to the entire organization. OKRs is not a silver bullet though. It requires a mindset and organizational culture that supports it. And it should NOT be used for judgement or performance evaluation. “No judgements, only learnings“.

Note: If you need to skip the stories and get practical steps, check Resource 4 for the author’s summary, and Google’s OKR Playbook

Favorite quote

“OKRs are not a silver bullet. They cannot substitute for sound judgement, strong leadership, or a creative workplace culture. But if those fundamentals are in place, OKRs can guide you to the mountaintop.”

John Doerr

And I can’t agree enough!

The book is based on many inspiring stories for companies that used OKRs to succeed. However, many of those same companies are either failing nowadays or facing existential threat! Like how Intel (the origin of OKRs) struggles with a brutal competition that threatens its future or how Zume Pizza fights for survival.

So, are these stories nowadays a proof of the failure of OKRs as a management method? if not, then why the opposite is true? why the success of those companies counted as proof of the success for OKRs?

Or let me rephrase the question: did those great companies in the book succeeded because they used OKRs, or OKRs gained success because it was used by successful companies?

There is a decent possibility for a survival bias here, but I think the answer is what the author mentioned brilliantly in the above-quote: OKRs are not magic sticks that could fix a broken business or failed idea. It requires “fundamentals” that should be in place first, then OKRs will be the point of liftoff!

My Recommendation

Avoid it 〇 Consider it Shortlist it Read it

OKRs are great tool to help you/your organization achieve success. And the book presents its values through inspiring stories of how it was implemented in big tech. You can skip the stories and read the summary, the material in the website and Google’s OKR Playbook, but you should definitely shortlist the book.

Key Lessons, Important Passages and Quotes

This is a summary of key lessons, important passages and quotes that I found useful in the book:

  • OKRs give you/your organization four superpowers: (1) Focus and Commit to Priorities, (2) Align and Connect for Teamwork, (3) Track for Accountability and (4) Stretch for Amazing.
  • Basic OKR Hygiene by Andy Grove:
    • Less is more: OKRs promise focus by keeping the number of objectives small: Three to five Objectives per cycle, each tied to five or fewer Key Results
    • Set the goals from the bottom up.
    • Stay flexible
    • Dare to fail
    • Stretched goals push organizations to new heights.
    • OKRs are tools, not weapons!: OKRs are bonuses are kept separate to encourage risk taking and prevent sandbagging
    • Be patient; be resolute 
  • The author recommends dual tracking of OKRs: “quarterly OKRs (for shorter-term goals) and annual OKRs (keyed to longer-term strategies) deployed in parallel.”
  • Quarterly OKRs cadence is recommended, but the best cadence is the one that fits the context and culture of the business. For example, a monthly cycle could be better for an early-stage company, six-week cycles could be best for engineering teams to fit with development sprints.
  • “You need to build your goal muscle gradually, incrementally.”, and managers should model what they ask their employees to do.
  • People/employees need to understand how their goals relate to the mission, and they “want to be ‘empowered’ and ‘inspired,’ not told what to do.
  • “Each key result should be a challenge in its own right. If you’re certain you’re going to nail it, you’re probably not pushing hard enough.”
  • Good tip: Pair key results to measure “both effect and counter effect”. For example, pair quantity with quality: (Objective 1) Three new Features, (Objective 2) Fewer than five bugs per feature
  • OKRs are the vehicle of vertical and horizontal alignment. And healthy organizations “encourage some goals to emerge from the bottom up”.
  • There is no right answer, but the author recommends a mix of top-down and bottom-up goals, generally settles at around half-and-half. “High-functioning teams thrive on a creative tension between top-down and bottom-up goal setting, a mix of aligned and unaligned OKRs.”, said the author.
  • Cascading results top-down makes an operation more coherente, but has four adverse effects: (1) Loss of agility, where each goal cycle takes weeks or even months, (2) Lack of flexibility, as people in such organizations become reluctant to revise goals mid-cycle, (3) Marginalized Contributors, as such systems prevent input from frontline employees or/and discourage contributes from sharing concerns or ideas, and (4) One-dimensional linkages that locks the cascading in vertical alignment and make it “less effective in connecting peers horizontally”.
  • If you don’t have a good prediction for the market, pin your key results to deadlines instead of output. After you get results, you can start pinning (or stretching) to projected outputs.
  • OKRs is a dynamic system. A Key Results can be upgraded to its own top-level OKR when it needs extra attention, then drift back down into KR when it no longer needs that attention.
  • Unlike traditional, frozen, “set them and forget them” business goals, OKRs are living, breathing organisms. “OKR can be modified or even scrapped at any point in its cycle. Sometimes the “right” key results surface weeks or months after a goal is put into play”. As OKRs gets tracked and audited, there are four options in its life cycle: (1) Continue: on track, (2) Update: needs attention, (3) Start: Launch a new OKR mid-cycle and (4) Stop: at risk
  • OKRs require regular check ins to prevent slippage. And people get motivated and engaged when they see that they make progress.
  • Reflection is a key component of successful OKRs: What did you learn that you didn’t foresee before starting the quarter? And how will you apply this lesson in the future?
  • The Wrap-ups of OKRs consists of three elements: objective scoring (what we achieved), subjective self-assessment (as guides, not as grades), and reflection.
  • Contextual feedback and broader discussion with the team is more important than the numbers, which leads to Continues Improvement through reflection.
  • “We do not learn from experience . . . we learn from reflecting on experience.” – John Dewey
  • Google divides its OKRs into two categories: (1) committed goals: the ones that are tied to Google’s metrics, and (2) aspirational goals: future-oriented, high-risk and reflects the big picture. The weighting of these two baskets varies from one organization to the next, and from quarter to quarter. For early stage, it may lean to aspirational goals to crack new markets, or a company in survival mode that needs committed goals.
  • With aspirational OKRs, falling short is expected and it’s still considered success in a lot of cases. And as Larry Page says, “If you set a crazy, ambitious goal and miss it, you’ll still achieve something remarkable”.
  • “Stretch OKRs tend to set powerful forces into motion, and you can never be sure where they’ll lead.” – Susan Wojcicki 
  • OKRs encourage risk taking. Therefore compensation (both raises and bonuses) should be separated from OKRs. Google wipes OKR numbers from the system after each cycle!

If you reached this far, I hope you enjoyed my summary. I’m trying to find the best structure for book reviews. If you find this structure useful or you have other suggestions let me know.