6 things I learnt about OKRs @ Microsoft

Sandeep Chadda

Sep 12, 2019·4 min read

We implemented OKRs in our group in Microsoft recently and it was a great learning to understand how to accomplish business or product goals effectively.

This post only talks about my perspective on how we benefited from OKRs. This post does not talk about how to execute OKRs.

What is OKR

OKR stands for Objectives and Key Results where the philosophy is to go after a goal by achieving measurable key results on a periodic basis.

• Objective: goal that the org, product, or team is set out to achieve
• Key result: one or more metrics that measure progress to achieve the objective

Here is a small example of OKRs. My son plans to increase awareness amongst kids on pollution and wastage. This is how we defined OKRs for him:

Objective: Increase awareness amongst kids about saving our planet

Key results: (until December 2019):

1. Complete writing a series of 8 books on plastic pollution, water wastage, cleanliness, reduce, reuse, and recycle
2. Complete illustrations for 4 of the 8 books
3. Find a publisher

Here our objective is clearly the big picture goal that we want to go after. One of the ways to achieve the goal is to write a book. And the KR is clear, simple, and measurable while not being a list of all the to do things.

6 things I learnt about OKRs

1. Drive clarity : Often in organizations, we know the vision and mission statements of an organizations. The vision and mission are mostly long lasting. However, it may become difficult to understand what is the top priority of the senior leadership at a particular time. These top priorities could be related to product, people, processes, culture etc. and may change from time to time. OKRs helped us in Microsoft to ensure that any one in the organization can get up to speed on what is the top priority of the leadership. This helped drive clarity with all the employees and helped teams or individuals to align with the overall organization objectives.
2. Common language: OKRs helped the whole organization to speak the same language as far the goals of the organization, product, or team goes. Anyone in the organization could read the OKRs of any other product or team and understand the kind of problems one is going after. We often heard complains about a team not knowing what another team in the same product is doing. Though we have backlogs shared across the organization, however there is not much that one can infer by reading the backlogs. Now we operate in a world where I can understand the objectives and measurable key results of any other team in my division.
3. Purpose: Employees are motivated by purpose, autonomy, and mastery as mentioned in the book Drive by Daniel Pink. OKRs helped drive the clarity deep within the teams. This helped individuals to build their mastery or expertise aligned with the larger purpose of the organization. One theme you will hear in Microsoft is that every individual wants to work on hard problems and deliver great customer value. OKRs helped us find where are those hard problems that would keep us super excited and charged up to come to work each day.
4. Boundaryless: Great products are built when the product groups are boundaryless. With clearly defined Objectives and Key results, the organization or team boundaries start to collapse since all teams are together motivated to achieve the common objective. This helps manage the team dependencies within and across teams since failure of one KR with one team can lead to the overall objective not getting accomplished. I observed heightened collaboration amongst teams where a common string of conversation was the Objective of the product as a whole.
5. Prioritization: Prioritization is a major skill that Product Managers need to learn to build great products. I have seen many product managers struggle with prioritizing their backlogs therefore shipping features that the customers would not value. OKRs bring some discipline and clarity around prioritization as well since the product team now continues to drive on a common product objective.
6. Growth Mindset: It is obvious that not all KRs are met and not all objectives are accomplished. Everytime we missed our KRs, the discussion was always around what we learnt and what others can learn from us. Were the KRs aggressive, was the planning not right, did we miss dependencies, some hypothesis were wrong, did an experiment not validate the hypothesis: At the end the intent is to ensure that all teams learn from one person’s mistake. With this mindset we got into celebrating misses and failures to ensure the org stays in a learning zone. As I always say, at Microsoft mistakes are expected, inpected, respected and corrected.

To summarize, the concept of OKRs is engrained deeply in our planning and execution cycle with the primary aim to drive clarity, generate energy, and ship success and generate tremendous customer value.