Why OKRs make us cry
If there’s one word with the habit of draining the colour from a leader’s face more than any other, it’s ‘planning’. It seems almost no matter the cadence or format, company planning processes are feared and derided in equal measure. But why must planning suck? After all, the intent of planning is a good one - ‘let’s decide what’s important in the next quarter/half/year, and then try to set ourselves up to succeed in that.’ I’ve yet to meet anyone who objects to the intent of planning, but there seems near universal fatigue around the execution. So my intent here is to interrogate that disconnect - why planning execution sucks, and what if anything might be done differently.
Why planning is hard
Let’s start with an honest assessment of the task at hand - planning is hard. If it weren’t, more organisations would be doing a great job of it…but few are. Here are just some of the reasons planning is hard:
Building the plane whilst it’s flying
Startups and scaleups are always attempting to build parts of the plane as it’s flying. From a planning perspective, that mode of operating presents challenges - people are working on a lot of urgent stuff to keep the plane in the air so don’t want to take the time to pause, and even if they do, the team itself often has holes in it, with key roles not yet hired or new people in role who don’t yet have sufficient context to plan effectively.
Investor pressure to project confidence
A startup, almost by definition, is a venture into the unknown. As a startup grows, so does its need to invest in coordinating more people and resources through planning. But much of the uncertainty still exists. Where things often go wrong is in the culture clash that exists between the innovative unknown of a startup, and the desire for predictable returns for investors. The relationship with uncertainty changes, not because any of the fundamentals have actually changed, but because there is an external need to project a greater degree of certainty than that which actually exists. In my experience, when planning becomes a dog and pony show for investors, it rarely proves valuable for the organisation.
Global uncertainty
Whilst we’re talking about uncertainty we can also add the many dimensions of global uncertainty in recent times, which were almost impossible to plan for - pandemic, war in Ukraine, major rise in interest rates etc.
It’s difficult to say no
‘No’ is incredibly important to say, but also difficult. In a land of opportunity the temptation is to say ‘yes’ to everything.
It’s hard to know where to allocate resources to have the biggest impact
With the complexity of what startups and scaleups are building, comes complexity in how to allocate resources. Some roles e.g. a salesperson are simply to justify - they come with a target that justifies their existence; others e.g. a new backend engineer are more nuanced.
Leaders will be judged against what they commit to
As an Exec, you are the accountable person who ends up putting their neck on the chopping block. In amongst all the complexity outlined above, and the investor pressure to exude false confidence, there are the high stakes in knowing that if things fail it will at best reflect poorly on you, or may even cost you your job.
Enter the mythical hero - OKRs
Now we get to the second most colour-draining term - ‘OKRs’. OKR stands for ‘Objectives’ and ‘Key Results’ - created by Andy Grove at Intel and then popularised by Google - OKRs became a poster child for better planning that aligned people with what really mattered for the business, alllowed for creativity in how best to get there, and thus unlocked inspiration and motivation amongst employees.
All of these things can be true, at least to some extent. So why the hollowed out look behind the eyes of an exec as OKRs are discussed?
Anti-patterns of OKRs
Despite the original promise of OKRs, the mythical hero has now largely become the feared villain, and I think I know some of the reasons why:
Believing the problem lies solely in the process or framework
Frameworks and processes can be highly beneficial in the right circumstances, but they are not a miracle cure for organisational problems. Too often, OKRs are brought in to solve planning, without confronting any of the truths listed above about what makes planning difficult. What happens? The organisation largely continues with the same challenges as before, it’s just they now have a new name that people quickly learn to resent. And that’s not unique to OKRs, there are alternatives such as 4dx etc. but none of them truly solve the hardest parts of planning.
No company strategy
OKRs are not a replacement for company strategy. The company needs a clear strategy first, before getting into discussions of OKRs, but this is often a huge void. In the absence of that strategy, OKRs have nothing that they’re aiming toward.
Poor organisation at the top
Generally speaking, companies using OKRs will intend to do a cascade, with company level OKRs set that then cascade down to teams. This requires the leadership team to be well organised in order to agree on the top level OKRs leaving time for others to plan off the back of that. Unfortunately, leadership teams are the most common culprit for lack of organisation, and the knock-on impact if they haven’t set the OKRs in time leaves teams either planning blind, or having to scramble last minute.
Everyone has a plan until they get punched in the mouth
The famous quote by Mike Tyson feels apt here. Even the best laid plans are going to be subject to change. I’d make a case that if plans never changed, that would suggest an organisation that is failing to adapt to new information. The problem though is when plans always change and there is no process for changing them. There’s nothing more demoralising then seeing the plans you invested so much time into being scrapped within weeks of being formalised time-and-time again; and the void that’s left behind once everyone knows that plans are changing but nobody’s quite sure how, is chaotic.
Call a spade a spade
Whilst OKRs often intentionally leave space for creative freedom on how to get to the desired outcome, it’s disingenuous to use OKRs as a means of false empowerment. Sometimes there is just something very specific that needs to get done over a certain timeframe, and that’s ok. Call the spade a spade. Don’t wrap it up in some OKR that says ‘our objective is to dig a hole…’ If there’s genuine opportunity to create an alternative to the spade that might do the job more effectively then great, but if not the abstraction will simply cause confusion and frustration.
No choices are made
As a rule of thumb, if you can’t name a single important thing that you’ve actively said no to as part of planning, then you’ve done a bad job. In fact it should be far more than one thing. OKRs are intended to drive focus and alignment, but there is no focus created if a company simply turns its laundry list of ideas into OKRs.
Letting them gather dust
OKRs will only be as good as the extent to which they actually influence decision-making and behaviour within the organisation. Everyone should be clear on them and have them front of mind, or at least have easy access to them in a document somewhere. All too often the attitude seems to be ‘well that’s OKRs done with for another quarter, now let’s put them in a drawer and get on with things.’
What could be different?
I think it’s worth point out upfront that planning will never be perfect. The aim should be good enough. Any more is difficult to achieve and would take up so much time as to not leave enough for execution. So here are some key considerations for what good enough might look like:
Start with the fundamentals - set a clear company strategy and communicate it regularly. This sets the context for all planning.
Have a clearly documented process - whether it’s OKRs you’re using, or something else - be really clear on what needs to happen by when and stick to the timings. There will be learnings to adapt to over time, in which case update the process.
The question isn’t ‘why?’ it’s ‘why now?’ - there are a lot of great ideas that can be readily justified when asking the question ‘why?’, but that won’t draw out the difficult choices that need to be made and the difficult conversations needed to help get there.
Plan like an investor - good VCs are great at managing risk and reward, so learn from them. View the investments you’re making as a portfolio of spread risk - there will be some sure-things, but there should also be some bigger bets that might be high risk, high reward. It’s important not to portray false confidence over the riskier bets.
What do OKRs mean here? Given the vast array of different interpretations of a framework like OKRs, it’s important to be specific about what OKRs mean in your organisation. How many should we be aiming for? Are they a target we should expect to hit or a moonshot goal where success is getting 60% of the way there? What proportion of people’s time should align with them vs. other things? What are the implications of missing them?
Be clear on how to scrap or update plans - there are different ways to approach this
Scenario planning - one way to mitigate the impact of constantly changing plans is to incorporate some scenario planning into the original plan e.g. here is plan A, but if X client lands ahead of schedule then this is what plan B might look like
Process for the unexpected - it need not be too specific, but simply look back at the last few occasions where something cropped up which changed plans dramatically, and ask, a) ‘were we right to make the change?’; and b) ‘what could we have done to better support and communicate that change?’
Don’t lose sight of what you’re there to do - this seems strange to need to point out; but in the motions of meetings, reviews, OKR drafts etc. it can be easy to mistake an OKR document as the end goal. But more important than the OKRs themselves is the process of debate that got you there, and the action which will happen as a result. So make time and space for that and avoid it becoming a box-ticking exercise.