OKRs

OKRs like its 2024 not 1974

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Its not 1970 any more, even 1974 was 50 years ago. I used to make this point regularly when discussing the project model and #NoProjects. Now though I want to make the same point about OKRs.

Fashion in the 1970s

The way some people talk about OKRs you might think it was 1974: OKRs are a tool of command and control, they are given to workers by managers, workers have little or no say in what the objectives are, the key results are little more than a to-do list and there is an unwritten assumption that if key results 1, 2 and 3 are done then the objective will be miraculously achieved. In fact, those objectives are themselves often just “things someone thinks should be done” and shouldn’t be questioned.

I’d like to say this view is confined to older OKR books. However, while it is not so common in more recent books many individuals carry these assumptions.

A number of things have changed since OKRs were first created. The digital revolution might be the most obvious but actually digital is only indirectly implicated, digital lies behind two other forces here.

First, we’ve had the agile revolution: not only does agile advocate self-organising teams but workers, especially professional knowledge workers, have come to expect autonomy and authority over the work they do. This is not confined to agile, it is also true of Millennials and Generation-Z workers who recently entered the workforce.

Digital change is at work here: digital tools underpin agile, and Millennials and Gen-Z have grown up with digital tools. Digital tools magnify the power of workers while making it essential the workers have the authority to use the tool effectively and make decisions.

Having managers give OKRs to workers, without letting the workers have a voice in setting the OKRs, runs completely against both agile and generational approaches.

Second, in a world where climate change and war threaten our very existence, in a world where supposedly safe banks like Silicon Valley and Lehman Brothers have failed, where companies like Thames Valley Water have become a byword for greed over society many are demanding more meaning and purpose in their work—especially those Millennials.

Simply “doing stuff” at work is not enough. People want to make a difference. Which is why outcomes matter more than ever. Not every OKR is going to result in reduced CO2 emissions but having outcomes which make the world a better place gives meaning to work. Having outcomes which build towards a clear meaningful purpose has always been important to people but now it is more important than ever.

Add to that the increased volatility, uncertainty and complexity of our world, and the ambiguous nature of many events it is no longer good enough to tell people what to do. Work needs to have meaning both so people can commit to it and also so they can decide what the right thing to do is.

In 2024 the world is digital and the world is VUCA, workers demand respect, meaning and to be treated like partners not gophers.

OKRs are a powerful management tool but they need to be applied like it is 2024 not 1974.

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OKRs create strategy alignment but not in the way you think they do

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Flat 3d isometric business people came from different way but have same target. Business team and target concept.

One of the claims made of OKRs is they solve the problem of alignment, strategic alignment specifically. So, anyone reading Pull don’t push OKRs post might be wondering how this can be. I’m sure many people will ask how alignment can be achieved without some master plan and planner?

The obvious way to ensure teams are aligned with company strategy is clearly to tell them what to do. Obviously, if we have some master planner sitting at the centre they can look at the strategy, decide what needs doing and issue command, using OKRs, to teams.

Think of this like programming: there is a core controller and each team is a sub-routine which is called to do a bit. Alignment can be programmed through step-wise refinement with each layer elaborating on the ask and passing instructions down.

Obvious really. Why did even bother describing it?

Obvious and wrong

Obvious too is that this is not Agile. But heck, we’re all “pragmatic” and obviously achieving this kind of co-ordination requires some compromise and in this case commands must be passed around.

Personally, I have an aversion to any scheme that involves telling others what to do. There are just so many things that could go wrong, far better that to come up with a scheme that is failure tolerant.

Rather than spend my time explaining why this approach is wrong let us try a thought experiment: for the next few minutes accept I am right and we can’t tell others what to do. (Leave me a comment if you want me to set out the reasons why.)

Now the question is: what does work does?

Emergent alignment.

This is a design problem (“how do we are design work so disparate teams work harmoniously to a common goal?”) so the principle of emergent design should work too. We want to create a mechanism which allows design to emerge.

Now OKRs have a role to play.

By setting out what a team intend to achieve in a short, standardised, format OKRs allow intentions to be communicated and shared. Thus OKRs can be placed next to other OKRs and compared. Sharing in a standardised format allows misalignment to become clear. Once the problem can be seen action can be take to realign: OKRs build a feedback loop.

OKRs are another example an agile tool which allows problems to be seen more clearly. Someone once said “Agile is a problem detector”, for me OKRs are a strategy debugger. Simply using OKRs does not automatically solve the problem, but it makes the problem to be solved clearer.

The organisation sets out its goal(s) and strategy. Teams are asked to produce OKRs to advance on that goal. If the strategy incorporates all necessary information, is communicated clearly and teams are completely focused on the strategy then everything will work.

But, if strategy is absent, if the strategy has overlooked some key piece of information, if the strategy is miscommunicated (or not communicated at all) or teams have other demands then things will not align. When this happens there is work to do, now we want to correct problems and create OKR-Strategy alignment.

Step 1: the centre, the senior leaders set out the strategy and goals – which should themselves align with the purpose and history of the organization.

Step 2: teams look at these goals, look at the other demands on them and the resources they have, and ask themselves: what outcomes do we need to bring about to move towards those goals while following the strategy?

They write OKRs for the next period based on their understanding.

Step 3: members of the centre look at those OKRs and talk to the team. Everyone seeks to understand how the OKRs will advance the overall goal. If everything aligns then great, start work!

If alignment is missing then work is required: perhaps work on the OKRs, or perhaps the strategy needs clarifying or the goals adjusting.

Because this approach is feedback based it is self-correcting. The catch is, for the feedback loop to work people need to invest time in reading OKRs and looking for alignment, and misalignment, and correcting.

In the “obvious solution” you don’t need these time consuming steps because the centre assumes it is right and anything which goes wrong is someone else’s fault.

By the way, a smaller version of the alignment problem is sometimes called “co-ordination.” This is where two, or more teams, need to align/co-ordinate their work to create an outcome, e.g. Team A needs Team B to do something for them. The same principles apply as before, only here it is the team members which need to compare the OKRs.

So there you have it. OKRs are a strategy debugger and they create alignment by building a feedback loop to promote emergent alignment.

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Two unspeakable Silver Bullets?

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“There are no silver bullets” wrote the late, great, Fred Brooks. Consequently most writers and evangelists avoid claiming they have a silver bullet even when it sounds like they are claiming just that. I’ve cautioned against silver bullets several times in this blog. I often find myself telling clients “The devil is in the detail.” Meaning: there are lots of things to address and no single big fixes.

Anyone claiming to have found a silver bullet deserves to be faced by scepticism. Still…

I find myself coming back to two solutions again and again. They are the closest thing to silver bullets I know. Even if these are not silver bullets in their own right applying either makes it easier to work the detail and tackle problems.

Yet these silver bullets dare not speak their name. To do so risks endless debate and damaging your own leverage.

Keep reading for the Silver Bullets

Writing this I’m avoiding naming the potential silver bullets because I even feel many readers will stop reading the moment I name them. Please, keep reading.

Both are widely discussed by the agile cognoscenti but both are controversial. Suggesting either may lead people to think you fail to comprehend the situation or are just stupid. Thus in both cases you are likely to end up in long discussions.

Both are disliked by opposite ends of the organizational hierarchy. Both ends are optimistic, and prefer to believe people should be able to rectify problems themselves (the people problem problem again.)

Both bullets are rarely applied with vigour. Perhaps because of the previous points. When I raise the points people plea helplessness, “My boss doesn’t understand.”

Both bullets scale: in the small and large, although they manifest themselves in different ways at different scale points.

Neither is an instant fix but both start to deliver returns relatively quickly. The problem with both is you need to keep the faith and keep applying them for weeks to see a difference. In both cases, people often give up before they see the benefit.

Bullet #1: work Test First

Specifically in technical teams applying Test First coding; whether Automated Unit Testing (e.g. TDD, test driven (first) development), Behaviour Driven Development (BDD) or some other form of Acceptance Test Driven Development (ATDD). Away from code, at team and organizational levels OKRs are implement the test first principle.

Test first will not fix all problems but it will remove a substantial number of problems. That makes managing the remaining ones easier. And as to where the “extra time” comes from, that is easy: the time you don’t spend fixing defects and misunderstandings. Test first is faster than debug later.

I’ve written a lot about test first so I won’t say more just now.

Bullet #2: reduce Work in Progress (WIP)

Most commonly WIP limits are applied through limited columns on a Kanban board or limiting the work taken into a sprint. Done right OKRs limit WIP too. However, reducing WIP requires discipline.

At the higher levels companies and Government entities seem quick to reduce staffing numbers but slow to reduce work. Accepting new “projects” is easy but resourcing them difficult. Rather than prioritise, say “No” and push back on work, everything is taken on. Individuals who push back as seen as pessimists, “not team players” and “obstacles.” Pushing back does not help your chance of getting promoted so leadership ranks tend to be populated by those who accept.

The result is salami sliced people and slow progress across a broad front rather than rapid progress across a narrow range. But, reducing WIP also seems to be the hardest medicine to administer. In fact, I sometimes find myself hiding WIP reduction measures.

As an aside, I feel WIP has gotten worse since the pandemic struck, the move to remote working means every conversation is now a meeting in the diary. Our diaries are now overrun with “Meeting WIP”. An ad hoc 10 minute conversation at the coffee machine is now a 30 minute Zoom call planned days in advance.

WIP reduction is applicable at all levels: reduce the number of pieces of work the individual is switching between, reduce the number of pieces of work teams are tackling, reduce the number of projects a department has in flight, and most of all: reduce strategic WIP.

Next time

There are lots of benefits of reducing WIP so let me ask: why is WIP so difficult to reduce? – that is the question I’ll address next time. So too is Why don’t people Test First?

Finally I’ll just note: I sometimes wonder why I stop being an OKR-cynical to learned to like them. The thing is, I see OKRs as a tool to address both these problems: OKRs are test first, and limiting OKRs is WIP limiting.

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Why OKRs require a strategy rethinking

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OKRs offer a way to connect strategy – high level abstract goal type things – with delivery – low level concrete detailed task level things. OKRs offer a middle level planning. They are replanned often enough to be flexible while lasting long enough to give enough stability to take on bigger, more ambitious work.

As with so much else about OKRs there is a more agile way of going about this and a less agile way of going about it. Connect strategy to OKRs in the less agile way and you end up back at command and control. The give away sign is that OKRs cascade down the company so teams don’t control their own destiny, ambition is neutered and motivation is lost.

Which approach you take will largely depend on the seemingly academic question: “what is strategy?”

Many people see strategy as a one way street. Strategy making and execution is hierarchal with decisions made at the top are passed down. Alternatively strategy can be seen as emergent property of a cooperating network. Strategy is a two way street, each node both informs strategy making and execution is guided by the resulting strategy.

Depending on how you view strategy you are going to implement OKRs very differently.

Is strategy a kind of planning?

Sad to say, the predominant view of strategy is that it is some sort of grand plan. The plan sets out the “place” the company aims to get to (price, position, etc), plus the route for getting there. Anyone who has studied a little strategy will recognise this as the “Porter view of strategy.”

Strategy as planning inherently sees strategists as master planners, all the relevant information is fed into the strategy/planning department. Experts analyse the data and rationally decide what needs doing. The plans are sent out.

This is inherently hierarchical so it natural to use cascading OKRs as the implementation mechanism. But because teams have little say in setting their OKRs motivation is lost and ambition is neutered.

The is a machine like view of organizations, inherently top-down, deviation from the plan, the strategy, is an error. When OKRs do not directly support strategy OKRs need to be changed.

Study a bit more strategy and you will find that while Porter’s view has appeal it is not the only view. There are in fact many different schools of thought on what strategy is.

Emergent strategy is more agile

To my agile mind the “emergent view of strategy” fits better. Strategy emerges over time from the activities of the organization, part planned, part reactive and part backward looking to explain the past. Professor Henry Mintzberg describes strategy as “a pattern of behaviour over time” which chimes with my pattern thinking.

Strategy is a two way street, teams are edge sensors: detecting technology changes, production techniques, putting products in the hands of customers and gathering feedback. This allows learning and adaption. The organization as a whole is a learning entity: discovering customer need and mastering new capabilities. Teams have the authority to act in the best interests of the company and customers. Over time strategy emerges.

When OKRs do not reflect stated strategy it is a learning opportunity. Ask: why do team OKRs deviate from strategy?

Is the team seeing something which the strategists do not? – in which case the OKRs are signalling back from the edges to the centre.

Is the team able to follow strategy? – maybe it lacks skills or capacity, or maybe it is overloaded with “business as usual.”

Has the intended strategy has been clearly communicated? Or maybe there is no explicit strategy?

Strategy, OKRs and agility

OKRs, like other agile tools, are problem detectors exposing opportunities for improvement.

Perhaps obviously, the “Strategy as a plan” view is going to limit agile to a back-room delivery thing because it passes over the opportunities for feedback and centralises decision making. Conversely, the “Emergent strategy” view entirely compatible with devolved authority, independent teams, experimentation and “the agile mindset”.

When teams act on their own initiative the organization will be more agile. When teams wait for instructions everyone is less agile. There may be a price for agility: teams may repeat work, teams may pursue the “wrong” goals but the price of that efficiency is lost agility which costs in missed opportunities and improvements.

If you want high levels of efficiency and believe in planned strategy you will look to decide strategy and align OKRs with the strategy before you do anything else. However, that results in less agility.

If you want to using OKRs and maximise agility then you need to take an emergent view of strategy. In many ways, we back to the Theory X or Theory Y question.

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