Measure What Matters (Book Review)
Measure What Matters by John Doerr is the management book around goal setting as a company. From legendary investor John Doerr and influenced by Bill Campell (executive coach), and full of examples from Google and the like.
The core of the book should also be possible to be applied to oneself. So let’s dive in.
Too much to read? Watch John Doerr’s TED Talk about OKRs (11min)
“Ideas are easy. Execution is everything.”
Objective: what is to be achieved
- significant, concrete, action-oriented, and (ideally) inspirational
- e.g. organize the world’s information
- e.g. make psychedelics more accessible
Key Results: how we get to the objective
- specific and time-bound (month/quarter), aggressive yet realistic
- measurable and verifiable
- e.g. grow revenue of Youtube by 30% this quarter
- e.g. make an overview of all psychedelics companies this quarter
Goals can be harmful, people can only work towards them and ignore opportunities and ‘goal-hack’. But don’t be mistaken, goals are necessary (insert Yogi Berra quote 😉 ).
Goals create alignment, clarity, and job satisfaction.
The rest of the book dives deeper into the ‘superpowers’ of OKRs:
- Focus and Commitment to Priorities
- Align and Connect for Teamwork
- Track for Accountability
- Stretch for Amazing
and the applications and implications
- Conversation, Feedback, Recognition
- Continuous Improvement
- The Importance of Culture
- Less is more
- it signals what to say yes to and no to
- three to five OKRs per cycle
- Set goals from the bottom up
- No dictating
- Stay flexible
- modify or abandon mid-cycle if needed
- Dare to fail
- aim higher than where you are now
- ‘train harder than last time’
- A tool, not a weapon
- OKRs and bonuses are best kept separate
- Be patient; be resolute
- it takes some time to get used to them
Focus and Commitment to Priorities
chapters 4, 5, and 6
“What is most important for the next three (or six, or twelve) months?”
Many people can’t name the priorities of their companies (or themselves for that matter).
- You will need to repeat the OKRs until you (leadership) become tired of repeating it, then people will know them
“… nothing moves us forward like a deadline.”
Quarterly OKRs are advised.
You need to pair OKRs to measure both effect and counter-effect. This means quality and quantity. Or speed and robustness. Only measuring one can lead to goal-hacking.
OKRs also mean that you don’t work on other things. These are the projects that need to get done, you can only work on another project if you update your OKRs.
“The art of management lies in the capacity to select from the many activities of seemingly comparable significance the one or two or three that provide leverage well beyond the others and concentrate on them.”
“Put more wood behind fewer arrows.”
Chapters 5 and 6 are examples from two companies that implemented OKRs.
“Instead of reacting to external events on the fly, we’re acting purposefully on our plans for each quarter.”
Align and Connect for Teamwork
chapters 7, 8, and 9
OKRs lead to alignment because you know what everyone/the company is working on (and only 7 percent of employees fully understand the goal of a company).
Chapter 7 has an example of OKRs for a football team, some good, some bad.
OKRs should work towards the greater goal, but also can/should come from bottom-up. At that level, people know best what to do to achieve the goals. Doerr says 50-50 is a good mix.
OKRs may be internal (do X) or external (get Y revenue). Depending on the phase of a company and how much you know of the environment, you can finetune this.
One good (alignment) question to ask is: Will this thing work towards our North Star?
Track for Accountability
chapters 10 and 11
OKRs can be tracked, and revised or adapted as circumstances dictate.
Cloud-based software could help with:
- Making goals visible to everyone
- Drive engagement
- Promote internal networking
- Save time, money, frustration
Track the goals for yourself (weekly, monthly, or whatever frequency works best). Preference of Doerr is weekly.
Then you can choose the following:
- start (new one)
- stop (do let everyone who is dependent on this OKR know)
Scoring (at Google) is done as follows. A bit objective with subjective ‘did I put in the effort’ mixed in:
- 0.7 to 1.0 = green
- 0.4 to 0.6 = yellow (progress, but not there)
- 0.0 to 0.3 = red (fail)
Always reflect on the progress made, as also to inform making new OKRs.
- Did I accomplish all of my objectives?
- If so, what contributed to my success?
- If not, what obstacles did I encounter?
- If I were to rewrite a goal achieved in full, what would I change?
- What have I learned that might alter my approach to the next cycle’s OKRs?
After this feedback, take a breath to savour your progress.
Stretch for Amazing
chapters 12, 13, and 14
“If companies don’t continue to innovate, they’re going to die – and I didn’t say iterate, I said innovate.” – Bill Campbell
Google divides their OKRs into two buckets
- Committed goals: related to metrics, aim is to get a 1.0
- Stretch/aspirational goals: bigger-picture, aim to get 0.7
- Google fails 40% of these
Stretch goals should be fine-tuned to an organisation. You should have some, but not all. And they shouldn’t be ‘fly to Mars next year’, but ‘build a working rocket next year’ (difficult, but remotely possible).
(fun fact: it was Susan Wojciki’s garage where Google started, she was employee nr 16 and YouTube’s 10x’er)
OKRs can also be seen as the ‘big rocks’ (Stephen Covey). Do those first, then add smaller and smaller pebbles and sand (to fill a jar).
Conversation, Feedback, Recognition
chapters 15 and 16
“A manager’s first role is the personal one. It’s the relationship with people, the development of mutual confidence … the creation of a community.” – Peter Drucker
This is in response to not everything being able to be captured by numbers, by OKRs.
The idea is that OKRs get coupled to continuous performance management in the form of:
- Conversations: manager and contributor
- Feedback: bidirectional and between peers
- Recognition: expression of appreciation
What is noted again is to decouple OKRs from compensation (otherwise the goals will be too low/high/goal-hacked). Feedback from the team and context is more important for compensation. (see graph p182)
The conversations are driven by the subordinate. It’s about goal setting/adjusting, update on progress (what works/doesn’t work), coaching both ways, career growth, mini-performance review.
Specific feedback to gauge if you’re doing well, what others need from you, etc. Also, feedback on the company.
Continuous, peer-based, objective, sharing stories, tied to company goals and strategies.
Story about Zume, but alas OKRs didn’t help them in the end.
The Importance of Culture
chapters 18, 19, and 20
“Culture eats strategy for breakfast” – saying/John Doerr.
Culture is the parts that include someone that champions the goals (OKRs) and others that help others and motivate (CFRs).
This part is a bit more vague, but it comes down to having a culture where people are going in the same direction, OKRs can help with getting that so.
“If you want to cut a man’s hair, is it better if he is in the room?” – Senegalese saying
“Ideas are easy; execution is everything.” – John Doerr
- 3-5 Objectives
- Aggressive but attainable
- Either aim for complete (1.0)
- Or aim out there with 10x projects (0.7)
- Qualitative and quantitative (prevent goal-hacking)
- 2-5 Key Results per Objective
- Weekly or per month
- Change goals if ‘ladder is on the wrong building’
- Rate (at end) from 1.0 (complete/full effort), <0.7 (progress), <0.4 (fail)
- What contributed to the success?
- What obstacles were there?
- How should it be rewritten?
- What changes for the next cycle?
- Take a break