Measure What Matters

Measure What Matters

by John E. Doerr

In Measure What Matters, the author digs into how setting objectives, and having key result metrics (OKRs) to measure their achievement, can help organizations to be most productive. The book cites many examples where corporations such as Google have used OKRs to consistently improve their performance, year after year, and stay ahead of competition. The book also emphasizes the human aspect to driving corporate performance through Conversations, Feedback and Recognition (CFRs). It challenges organizations and team leaders to change their work culture for the better, by combining the forces of OKRs and CFRs to create a high-motivation environment for their employees.

Summary Notes

OKRs in Action

“Where OKRs take root, merit trumps seniority. Managers become coaches, mentors, and architects. Actions — and data — speak louder than words.”

OKRs, short for Objectives and Key Results, is a collaborative goal-setting protocol for companies, teams, and individuals. It’s not a silver bullet. It’s not a substitute for sound judgment, strong leadership, or a creative workplace culture. But if these fundamentals are in place, OKRs can take you to the mountaintop.

An Objective is simply what is to be achieved, no more and no less. Objectives are significant, concrete, action-oriented, and ideally inspirational. When properly designed and deployed, they’re a vaccine against fuzzy thinking and execution.

Key Results benchmark and monitor how to meet the objective. Effective KRs are specific and time-bound, aggressive yet realistic. Most of all, they’re measurable and verifiable. You either meet a key result’s requirement or you don’t. There’s no gray area, no room for doubt.

An effective goal management system — an OKR system — links goals to a team’s broader mission. It respects targets and deadlines while adapting to circumstances. It promotes feedback and celebrates wins; both large and small. Most importantly, it expands our limits, moving us to strive for what might seem beyond our reach.

Actions to take

Focus and Commitment

“Measuring what matters begins with the question: What is most important for the next three (or six, or twelve) months?”

Successful organizations focus on the handful of initiatives that make a real difference, deferring the less urgent ones. Their leaders commit to those choices in word and deed. By standing firmly behind a few top-line OKRs, they give their teams a compass and a baseline for assessment.

Regardless of how leaders choose a company’s top-line goals, they also need goals of their own. Just as memos can’t transmit values, structured goal-setting won’t take root by fiat. Leaders have to model it and clearly communicate how the goals relate to the organization’s mission.

To make reliable progress, a manager must be able to measure performance and results against the goals. If an objective is well-framed, three to five key results will usually be adequate to reach it. Too many can dilute focus and obscure progress. Each key result should be a challenge in its own right - if you’re certain you’re going to nail it, you’re probably not pushing hard enough.

Actions to take

Alignment and Connection

“As a species, we crave connections. In the workplace, we’re naturally curious about what our leaders are doing and how our work weaves into theirs. OKRs are the vehicle of choice for vertical alignment.”

In larger organizations, it’s common to find several people unwittingly working on the same thing. By clearing a line of sight to everyone’s objectives, OKRs expose redundant efforts and save time and money.

In an OKR system, the most junior staff can look at everyone’s goals, up to the CEO’s. Critiques and corrections are out in public view, and contributors have carte blanche to weigh in, even on the flaws of the goal-setting process itself.

This sort of transparency seeds collaboration. If an employee is struggling to reach a quarterly objective, for example, because they’ve publicly tracked their progress, colleagues can see they need help, and are able to jump in, post comments, and offer support. The work improves, and relationships are deepened or even transformed.

Focused, transparent OKRs align each individual’s work to team efforts, department projects, and the overall organizational mission.

Actions to take

Tracking and Accountability

"The simple act of writing down a goal increases your chances of reaching it. Your odds are better still if you monitor progress while sharing the goal with colleagues — two integral OKR features.”

Employees are most engaged when they can actually see how their work contributes to the company’s success. Quarter to quarter, day to day, they look for tangible measures of their achievement. Extrinsic rewards, like the year-end bonus check, merely validate what they already know. OKRs speak to something more powerful — the intrinsic value of the work itself.

Most goal management platforms use visual aids to show progress towards objectives and key results. More organizations are beginning to adopt robust, dedicated, cloud-based OKR management software. These platforms make everyone’s goals more visible, drive engagement, promote internal networking, and save more time, money, and frustration.

For an OKR system to function effectively, the team deploying it — whether a group of top execs or an entire organization — must adopt it universally. Regular check-ins, preferably weekly, are also essential to prevent slippage. The days that people make progress, and can visibly see it, are the days they feel most motivated and engaged.

Actions to take

Stretch-Goals and Amazing Results

“For companies seeking to live long and prosper, stretching to new heights is compulsory.”

OKRs push us beyond our comfort zones. They lead us to achievements on the border between dreams and abilities. They unearth fresh capacity, hatch more creative solutions, and revolutionize business models.

Not everyone is a natural-born achiever, but ‘stretched’ goals can help to elicit peak performance out of both leaders and their team members. Not only are stretched workers more productive, but they’re also more motivated and engaged. It turns out that when people are pushed past their old limits, they become forces for operating excellence.

In addition to ‘committed’ goals — objectives that must be achieved 100% within set time frames — every company should have ‘aspirational’ goals. These are bigger-picture goals aimed at stretching every employee to achieve more. They may not be achieved 100%. In fact, failure should be expected and accommodated. The point of having such goals is to push us beyond our comfort zones consistently enough to one day lead us to achieve amazing results.

Actions to take

What Really Counts

“Not everything that can be counted counts, and not everything that counts can be counted.”

Individuals cannot be reduced to numbers. A manager’s role is the personal one — relating with people, developing mutual confidence, and creating communities. To reach goals almost beyond imagining, people must be managed at a higher level.

Just as quarterly OKRs have replaced pro-forma annual goals, we need an equivalent tool to revolutionize outdated performance management systems. One such system is continuous performance management, and it’s implemented with an instrument called CFRs — Conversations, Feedback, and Recognition. CFRs champion transparency, accountability, empowerment, and teamwork, at all levels of an organization. They give OKRs the human voice they need.

When companies replace their annual reviews with ongoing conversations and real-time feedback, they’re better able to make improvements throughout the year. When employees are struggling, managers don’t sit and wait for some scheduled day of reckoning. They jump into tough discussions like firefighters, without hesitation.

Continuous performance management elevates performance from bottom to top. It boosts morale and personal development for leaders and team members alike; and when leveraged with quarterly goals and built-in tracking of OKRs, it can be even more powerful.

Actions to take

Culture Change

“Healthy culture and structured goal setting are interdependent. They’re natural partners in the quest for operating excellence.”

Culture gives meaning to work. A growing number of job seekers are making their top criterion “the right cultural fit.” While chiefs of large companies are turning to OKRs and CFRs as tools for culture change within their organizations.

OKRs are clear vessels for leaders’ priorities and insights, and CFRs help to ensure that those priorities and insights get transmitted. But goals can’t be transmitted in a vacuum; they require a medium. For OKRs and CFRs, that medium is an organization’s culture — the living expression of its most cherished values and beliefs.

High-motivation cultures rely on a mix of two elements: Catalysts and Nourishers. Catalysts are the actions that support work, just like OKRs. They include: setting clear goals, allowing autonomy, providing sufficient resources and time, helping with the work, openly learning from mistakes and successes, and allowing a free exchange of ideas. Nourishers are much like CFRs. They are acts of interpersonal support within the organization — respect and recognition, encouragement, emotional comfort, and opportunities for affiliation.

In changing an organization’s culture for the better, OKRs provide the purpose and clarity needed to plunge into the new, while CFRs supply the energy needed for that journey.

Actions to take

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