John doerr is a legendary venture capitalist - most famous for his 11.8 million dollar bet on 12% of google in 1999.
He formulated a goal setting strategy for management teams called OKR’s - objectives and key results.
Objective is WHAT is to be achieved.
- Significant, concrete, action oriented, and inspirational.
Key Results are benchmarks and monitor HOW we get to the objective.
- Specific and time bound, aggressive yet realistic, measurable and verifiable. Needs a number.
- No grey area, you either meet a key result or you don't
Other notes on OKRs
- OKR’s should always be transparent throughout a company and every level employee should have a stake in deciding what they are.
- When people help choose a course of action, they are more likely to see it through.
- Don’t tie OKR’s to compensation - suppresses ambition and risk taking.
- They should be bottom up or sideways, not top down
- Timed quarterly or monthly
- Limit of 3-5 OKR’s per cycle, limit of 4 Key Results/Objective
- Set goals from the bottom up, teams should be able to set at least half of their OKR’s
When crafting OKR's, consider this:
Completion of ALL key results MUST result in attainment of the objective**
“If I complete Key Result 1-5, will I have undoubtedly reached my objective?”
Alignment in OKRs
To align multiple levels in an organization it’s possible for upper level KR’s to become lower level objectives
OKR’s should be tracked for accountability
At end of quarter Objectives are measured by a percentage of the completed KR’s
.7-1 = completed
.4-.7 = ok
.-.3 = improvement or bad OKR
Continuous performance management (an alternative to annual reviews)
- alternative to annual reviews (called CFR’s)
- Conversations - talk with your team member about their term
- Feedback - give it
- Recognition= recognize their accomplishments