Why we adopt OKR?

The Problem Statement

I currently lead an IT Division, comprising many teams ranging from Product Development, AI & Data Science, Cloud Services to IT Security. Last year, three key concerns were identified:

• How to keep up with evolving business changes in a highly uncertain environment?
• How to provide the visibility on what the work that the teams and individuals do contribute to business outcomes and success?
• How to get all the agile product and service teams to cohesively collaborate on the high priority areas, especially when technology work today has to be done highly distributed?

The Intent

To address the above, the IT leadership team had started work to update the IT internal systems and processes that aims to achieve:

• Alignment. External to the IT Division, we need clarity on the IT Division’s alignment to the business strategy and outcomes. Internal to the IT Division, we need clarity on the teams’ alignment to the IT level strategy and outcomes.
• Focus. We need to establish clear focus and prioritization on the outcomes to be achieved at the IT level. We cannot afford to spread ourselves too thin to work on too many initiatives.
• Interdependency Management. Different teams should get visibility on the other teams’ work as a mean to manage the interdependencies within the IT Division, leading to ‘horizontal alignment’.

The Management Tool

With this in mind, the IT leadership team agreed to adopt OKR. More information on OKR is available in John Doerr’s book, Measure What Matters, as well as at www.whatmatters.com, with official definition as follows:

“OKRs stand for Objectives and Key Results. It is a collaborative goal-setting methodology used by teams and individuals to set challenging, ambitious goals with measurable results. OKRs are how you track progress, create alignment, and encourage engagement around measurable goals. It works for setting goals throughout many company functions and levels, and can also work for personal goals.”

There are many success stories on the adoptions of OKR, which we are learning from. However, we remind ourselves to be careful not to see OKR as the management tool that we solve ALL our problems. In particular, we have to be cognizant what OKR is not:

• OKR is not only “Objectives + Key Results”. While these are key components of the OKR methodology, it also emphasizes on the elements of Focus, Align, Commit, Track and Stretch. Nevertheless, many companies adapted the “ideal OKR methodology” to fit their specific context and needs.
• OKR does not replace Strategy. Different tools are still required for the analysis and formulation of your business and operational strategies. OKR is meant to translate Strategy into Execution, with the objectives and key results derived from the strategy.
• OKR is not Business As Usual. It is not the sum of all the work we need to do, but zooms into the areas that need to change. The OKRs for the IT Division will spell out the areas of change that I need to allocate my bandwidth and pay attention to.
• OKR is not KPI. KPIs are metrics to evaluate how well work is done while OKRs look at what are achieved as Ends. Some KPIs can be KRs, but not all. This does not mean KPIs that are not KRs have no value; the two are just looking at different things.

My Takeaways (so far)

We have only just piloted the OKR for the IT Division. In this short journey, I have learnt:

• Less is More. From the book: “We must realize, and act on the realization, that if we try to focus on everything, we focus on nothing.” OKR is meant to provide focus on the key changes. Having too many will dilute our attention and energy. The challenge is to have the discipline to force ourselves to focus on 3 to 5 outcomes.
• Collaborative goal setting. Establishing the IT Divisional OKR will require the leadership team to come together to collaborate and own the shared aspirations, collective demands and operational tradeoffs. Besides ownership, such conversations also help to build understanding and alignment.
• Commitment. A lot of work is required to make OKR work, from the collaborative goal-setting to tracking and review. The gains will be delayed: we will probably see its value later when we gets into the “groove” of doing it. When we choose to start on the OKR journey, we must be prepare to commit and persevere.
• Transparency. Sharing the IT Division’s OKRs will allow the respective teams to understand the whys and whats that the Division need to change, so that the teams can know how to align their work with the higher level priorities. In addition, transparency seeds collaboration and accountability.

As we practice and reflect, we will learn more from the journey, and be able to form new perspectives and insights. This is all part of our development and growth.

P.S.: This write-up is adapted from my blogpost in the Intranet.