How John Doerr used football to land OKRs
- Larry Page credits OKRs — Objectives and Key Results — with making Google’s “crazily bold mission” achievable.
- When used in a “cascaded” fashion, the OKR process can degrade into a mechanical exercise with adverse effects.
- Precisely because OKRs are transparent, they can be shared without cascading them in lockstep.
In the bygone business world, work was strictly driven from the top. Goals were handed down the org chart like tablets from Mount Sinai. Senior executives set top-line objectives for their department heads, who passed them to the next tier of management, and so on down the line.
While this approach to goal-setting is no longer universal, it remains prevalent at most larger organizations. The appeal is obvious. Cascaded goals corral lower-level employees and guarantee that they’re working on the company’s chief concerns. In the best case, cascading forges unity; it makes plain that we’re all in this together.
In my pitch to Google and many other organizations, I’ve used an imaginary football team to show how the OKR system works effectively—or not—when used in this fashion.
Let’s say I’m the general manager of the Sand Hill Unicorns. I have one objective, the WHAT: Make money for the owner. My objective has two key results: win the Super Bowl and fill the stands to at least 90 percent capacity, which is HOW I will make money for the owner. If I fulfill both of those HOWs, there is no way we can fail to show a profit. So it’s a well-constructed OKR.
As general manager, I cascade my goal down to the next level of management, the head coach and the senior vice president of marketing. My key results become their objectives. The head coach’s objective is to win the Super Bowl, with three key results to get him there: a passing attack of at least 300 yards per game, a defense surrendering fewer than seventeen points per game, and a top three ranking in punt return coverage. He cascades those KRs as objectives for his top three executives, the offensive and defensive coordinators and special teams coach. They in turn devise their own, lower-level key results. To achieve a 300-yards-per-game passing attack, for example, the offensive coordinator might aim for a 65 percent pass completion rate and less than one interception per game—after hiring a new quarterbacks coach.
Meanwhile, my SVP of marketing has derived her objective from my other key result, to fill the stands to 90 percent capacity. She’s crafted three key results: Upgrade the team’s branding, improve our media coverage, and revitalize the in-stadium promotion program. These KRs are cascaded as objectives for the marketing director, team publicist, and merchandise manager, respectively.
Now, what’s wrong with this picture? Here’s a clue: The SVP’s key results are a mess. Unlike the head coach’s KRs, they’re unmeasurable. They’re not specific or time bound. How do we define “improvement,” for example, in the team’s media coverage? (Five special features on ESPN? One cover spread in Sports Illustrated? Fifty percent more followers on social media?)
But even if the SVP came up with stronger key results, the organization’s goal-setting approach would remain deeply flawed. The top-line objective—to make a wealthy person wealthier— lacks intrinsic motivation for the general manager, much less for the team’s East Coast scout or the PR intern slaving away at the copy machine.
In moderation, cascading makes an operation more coherent. But when all objectives are cascaded, the process can degrade into a mechanical, color-by-numbers exercise, with four adverse effects:
- A loss of agility. Even medium-size companies can have six or seven reporting levels. As everyone waits for the waterfall to trickle down from above, and meetings and reviews sprout like weeds, each goal cycle can take weeks or even months to administer. Tightly cascading organizations tend to resist fast and frequent goal setting. Implementation is so cumbersome that quarterly OKRs may prove impractical.
- A lack of flexibility. Since it takes so much effort to formulate cascaded goals, people are reluctant to revise them mid-cycle. Even minor updates can burden those downstream, who are scrambling to keep their goals aligned. Over time, the system grows onerous to maintain.
- Marginalized contributors. Rigidly cascaded systems tend to shut out input from frontline employees. In a top- down ecosystem, contributors will hesitate to share goal- related concerns or promising ideas.
- One-dimensional linkages. While cascading locks in vertical alignment, it’s less effective in connecting peers horizontally, across departmental lines.
Fortunately, we have an alternative. Precisely because OKRs are transparent, they can be shared without cascading them in lockstep. If it serves the larger purpose, multiple levels of hierarchy can be skipped over. Rather than laddering down from the CEO to a VP to a director to a manager (and then to the manager’s reports), an objective might jump from the CEO straight to a manager, or from a director to an individual contributor. Or the company’s leadership might present its OKRs to everyone at once and trust people to say, “Okay, now I see where we’re going, and I’ll adapt my goals to that.”
Considering that Google has tens of thousands of employees, its innovative culture would be hamstrung by OKRs cascaded by rote. As Laszlo Bock, a former head of the company’s People Operations, observes in Work Rules!:
Having goals improves performance. Spending hours cascading goals up and down the company, however, does not. . . . We have a market-based approach, where over time our goals all converge because the top OKRs are known and everyone else’s OKRs are visible. Teams that are grossly out of alignment stand out, and the few major initiatives that touch everyone are easy enough to manage directly.
The antithesis of cascading might be Google’s “20 percent time,” which frees engineers to work on side projects for the equivalent of one day per week. By liberating some of the sharpest minds in captivity, Google has changed the world as we know it. In 2001, the young Paul Buchheit initiated a 20 percent project with the code name Caribou. It’s now known as Gmail, the world’s leading web-based email service.
To avoid compulsive, soul-killing overalignment, healthy organizations encourage some goals to emerge from the bottom up. Say the Sand Hill Unicorns’ physical therapist attends a sports medicine conference and learns of a new regimen for injury prevention. Of her own volition, she coins an off-season OKR to implement the therapy. Her objective may not align with her direct manager’s OKRs, but it aligns with the general manager’s overarching objective. If the Unicorns’ top players stay healthy through the season, the team’s chances of winning the Super Bowl will soar.
