An agile system for changing times

Table of contents

Purposeful organization, Agile leadership, Culture, Empathy and Digitization (PACED) is what we deem critical to succeed in the marketplace today, and for the future. Relying on systems created for customers and market conditions that are no longer valid at this time, is sheer stupidity.

OKRs accommodate the new demand. They help organizations maintain themselves and grow. From my conversations with 45 CEOs & CXO leaders of startups/scale ups, the following factors have emerged as clear mandates for success - the fundamentals of OKRs. I’ll assess how OKRs enable each of them in detail.

#1 Translating Strategy to Execution

Company OKRs should be developed to be the driving goals, that inevitably lead to successful execution of strategy, enabling the company mission. By breaking down the strategy into measurable goals, teams can determine what actions to take and which initiatives to prioritize, in order to achieve the goals. Thus, translating strategy to the day to day execution.

OKRs are set on a quarterly basis, allowing teams and individuals to pivot based on changes in the marketplace, and more importantly ‘fail fast’. They help companies mobilize their resources and implement tactics, using regular measurement, and progress reviews. Traditional goal-setting and execution systems have relied heavily on mechanistic and outdated systems, no longer yielding results. This creates vulnerability, and it impacts their top-lines and bottom-lines. Refining the archaic annual cycle to a more frequent cycle, allows more effective and efficient pivots respond to changing consumer and competitor activities.

#2 More Focus on Priority

With a growing number of companies trying to compete in the marketplace, everything seems to be a priority at work. What the business avoids doing, is as important, as what it chooses to do. Priorities should be connected to the purpose, vision, mission, and values of an organization, and will provide the clarity necessary for strong direction. That way, your finite resources will be directed to the most important areas for growth.

OKRs provide you with a solid framework to determine what matters most. Enabling organizations to execute on the highest priorities with agility. The ultimate goal of OKRs is to help teams prioritize goals and make decisions on how to use resources - specifically their people, time, and money - to achieve the desired objectives.

#3 Alignment on goals

OKRs enhance systemic thinking. It encourages leaders to convert their strategy to annuals goals, and break them down by quarter to simplify immediate actions. It then becomes critical for teams to align themselves with the overall goals and purpose of the organization, to ensure they are working on the right thing. One will see true alignment when there is a healthy fusion of top-down, bottom-up and cross alignment between teams. All working towards the same goals. The result? A well-oiled engine, generating great value for the organization.

The FIFA World Cup is a great example of how team coherency is the key to success. Heroes do not guarantee a win. Football clubs spend millions buying players, but still end up losing, simply due to player compatibility issues. This is the exact same in business. A fantastic executive can only drive the company so much. Company-wide alignment is the winning goal.

For instance, if a supply chain is unable to produce enough volume of a product, higher sales numbers will not do anything on their own. If the procurement team of a cell phone company is unable to make enough chips available on time, the product development team’s goals of rolling out 10x more products in the marketplace will remain unachievable.

Cohesion among departments and teams is critical, to the overall success of the organization. Without the alignment, you’ll find that it’s every man for himself and the company is directionless.  

#4 Value Creation & Ownership

OKRs, especially the Key Results, are defined in a way that help create more autonomy and empowerment. Well crafted Key Results are value-based, rather than activity-based. That way, tasks, projects and activities are chosen, based on directing efforts toward the set outcome.

Employees are seeking more autonomy and empowerment at work, and by using OKRs they have the opportunity to determine what they work on. Overall, this will help them find more meaning in their work, as they can see how their actions directly affect the company’s achievements. They are compelled to look beyond the, otherwise, narrowly defined tasks, in their attempt to ultimately create value.

Let’s take the example of John who was asked conduct 10 interviews per day as part of his role within the  recruitment team of an HR department. While Jane on the other hand had a different goal - to hire and onboard 2  key positions in the next 3 months. I would now ask you to think what John would be experiencing as he shows up to work every day. John’s focus will remain on completing 10 interviews daily. Jane, on the other hand, would be more focused on the final outcome – thus allowing her to take charge of the results and own the job.  

#5 Rapid Innovation

The OKR framework ignites a truly agile system, by acting as the conduit for cultural transformation within organization. Rapid innovation is able to thrive with the OKR culture as the ‘fail-fast’ mindset is adopted. You’ll see quick experimentation of initiatives, safety to take calculated risks, collaboration, and learning.

Apple, Google, Amazon, Microsoft, and Samsung, in the order of appearance, have been ranked the top 5 most innovative companies in 2020 by Boston Consulting Group. What do they have in common? It’s their ability to generate value through constant disruption and innovation. Innovation is a key factor that propels organizations from one S-Curve to another.

By now you may have noticed how these elements not only work as causal factors for organizations to perish, but also act as change levers in making them thrive and grow. OKRs help organizations to build agility, enhance interdependencies, increase levels of innovation, and create more ownership and engagement from its employees. OKRs are also, therefore, the automatic choice for businesses  that want to gear up to create a Purposeful Organization, Agile Leadership, Culture, Empathy and  Digitization led company (PACED).

Author photo

Nikhil K Maini

OKR Coach, OKR International

Share this post
Weekly insights for outcome-driven teams
Subscribe to our newsletter to get actionable insights in your inbox.
Related articles
More articles →