OKRs are addressing more than one problem.
- Focus — limiting work-in-process (WIP).
- Alignment — coordinating efforts both vertically (following reporting lines) and horizontally (across organisation boundaries).
- Tracking using concrete indicators of progress, that is, intermediate key results.
- Motivation in two forms: challenge and encouraging initiative. NOTE: John Doerr calls this “stretch” but that only covers the challenge part.
Lack of alignment is typically a bigger problem than lack of ambition.
John Doerr says that an OKR “sanctions the ability to take risks”. This is why there is typically an expectation set that you should only plan to be able to accomplish 50–80% of your OKRs, depending on where you want to set your ambition level.
Although I agree that risk aversion may be a problem, I would suggest that for any large organisation, alignment and coordination is a much bigger problem than lack of ambition and risk aversion.
The more important problem is being able to trust commitments to avoid cascading schedule collapse (I’m late which makes you late which makes them late which….).
Google distinguishes between Committed OKRs and Aspirational OKRs to address this.
The back-and-forth interactions during the OKR process are the most critical part.
John Doerr calls OKRs a “cooperative social contract”. The back-and-forth interactions between people during the creation and adjustment of OKRs are the most critical part. The hoshin kanri community calls these interactions “catchball”. Written OKRs without these interactions are mostly useless.
There are three typical ways to get bad OKRs.
OKRs are bad typically due to three things:
- Lack of or bad interactions between people: No cooperation, unclear expectations, etc.
- Lack of or bad knowledge and thinking: There is no point to align with nonsense.
- Ignorance about one’s ability to execute: Essentially excessive ambition which shifts motivating challenging goals to demotivating impossible goals.
A quarter is typically too short of a horizon for long-term planning.
Quarterly OKRs are too short of a horizon for long-term planning. I’d expect big picture visions to cover at least a 1-year horizon, probably more, and strategic roadmaps to cover multiple quarters.
If you’ve done an effective job at visions and roadmaps, quarterly, or even annual, OKRs should be something that falls out of it.
A quarter is typically too long for medium-term planning.
In a competitive and/or complex environment, I’ve typically found either things change or new opportunities show up month-to-month. Which means any quarter-level plan should be adjusted.
Instead, I prefer 3-month rolling wave planning updated every month.
NOTE: The best book I like on OKRs is John Doerr’s Measure What Matters. However, I’d also recommend exploring Toyota’s hoshin kanri approach and the history and evolution of “management by objectives” (MBO) in general.