By adopting the OKR methodology, Agile Lab goes beyond the well-known limits of most organizations which are based on a command and control model.
As a matter of fact, most of traditional organizations deal with slow decision making processes, difficulties in keeping a high level of innovation and a lack of employees' commitment and ownership.
What are OKRs?
OKR (Objectives and Key Results) is a goal-setting framework conceived to spread the company's strategy among employees and to support the efficiency in the execution of tasks with a transparent and collaborative approach.
From a historical point of view, the OKR method is generally attributed to Andrew Grove, who introduced it to Intel during his tenure, and later to John Doerr at Google.
As the name suggests, an OKR is made of an objective and some key results
the objective describes the company priorities in the short term, consistently with the company purpose and the long-term vision. This is the outcome of the process since it explains "what" we want to achieve.
key results are a list of results that must be numeric, measurable and linked to the objective. They show how near the company is to the objective. They are the output of the process since they explain "how" the goal will be achieved.
As a rule of thumb, a company should have no more than 2 OKRs per quarter. This will lead to the choice of real priorities. Ideally, one objective could be more aspirational and the other one more technical.
A good objective should be:
- feasible in one quarter
- shared among the organization members
- inspirational and not numeric
- clearly consistent with the company business
- challenging but realistic
- under the team's control
- in the form "verb + what do you want to reach + why + the application field"
Good key results should:
- be measurable on a weekly basis
- not be binary
- not exceed the number of 3-4 per objective
- clearly show how near is the goal
- be limited to the only ones useful to reach the target
- represents the 100% of the objective
- not be influenced by external actors and dependencies
- in the form "verb + what will be measured + the extension of the result"
This is an example of a good OKR:
- OBJ: Increase the employees' digital skills to sustain the ongoing digital transformation process of the company and to reduce costs
- KR1: Write a gap-analysis document with x pages comparing the - internal skills to the reference market's ones.
- KR2: Reduce digital experts' turnover from x% to y%
- KR3: Hire x digital experts in the next quarter
- KRn: ...
One of the most powerful aspects of the OKR framework is the ability to align each employee's effort and decision, from the front line through the most operational areas to the company strategy.
This is possible because the objectives of lower levels become the key results of higher levels. These are called cascading OKRs.
OKR adoption in Agile Lab
Agile Lab adopted the OKR framework by crafting its own customized process, which recurs quarterly.
The OKR Facilitator is in charge of the process milestones, timelines and outcomes.
Each quarter starts with the "OKR week" which aims at involving as many employees as possible in the process by inviting them to a series of scheduled meetings.
In these meetings, we take forward the following steps:
- The CTO and the CEO communicate the quarter strategy
- The top-level OKR objective is defined and formalized
- As many employees as possible get involved in the brainstorming process for key results of top-level OKRs
- Selection and formalization of best key results for top-level OKRs
- Gathering of ideas for cascading OKRs (as explained in the "Cascading OKR" section, objectives come from top-level key results and don't need to be defined anymore)
- Selection and formalization of best key results for cascading OKRs
The beginning of the OKR week is notified to the whole company by the OKR Facilitator, who will then invite all the members interested in attending these events.
Execution and monitoring
After the OKR week, we track progress of tasks and projects related to OKRs during weekly status meetings. If there are roadblocks, we'll try to find a collaborative way to remove them.
Review and retrospective
At the end of the quarter, the OKR Facilitator organizes a review and a retrospective meeting to understand what went wrong and how to improve the process.