OKRs Ensure OIT is Tech-Driven, People-Powered

Objectives and Key Results (OKRs) are more than just checking off a box when a project is complete. They are measurable results that set direction and can supercharge an organization. 

OKRs famously played a role in the rapid rise of tech companies like Google and LinkedIn, but all sorts of organizations – tech and non-tech, private and public – have grafted OKRs into their DNA.

These organizations include the U.S. Department of Health and Human Services, which began to implement OKRs two years ago. As CMS OIT codifies them into our own operations, we’d like to help employees understand what they are and how they should be used. 

What are OKRs?

OKRs are a goal-setting system. They originated at Intel and gained prominence when Google adopted them at the behest of investor and former Intel executive John Doerr. 

The formula for an OKR is, “I will [objective] as measured by [key results].” Objectives like “increase customer satisfaction” or “improve website user experience” are laudable, but how can we measure those goals? And do our measurements communicate the right incentives? 

That’s where key results come in. Examples of key results include, “increase purchase rate from X% to Y%” or “increase weekly visits from X to Y.” Note that these key results are measurable and trackable. (Measurable does not mean quantifiable. In other words, measurements must be taken from objective phenomena, not a subjective judgment like “percentage completed.”) Further, the measurements should communicate actionable information. 

Why do they Work?

• OKRs increase transparency because they can be seen by the entire organization. They help everybody visualize value streams.
• Rigorously measurable key results encourage data-driven decision-making.
• In a healthy organization, the best ideas get sunlight, no matter who they come from. OKRs do not flow top-down from leadership. They represent every work effort in parallel with leadership’s OKRs. Staff OKRs inform management OKRs and vice versa. This system allows for two-way communication and real-time alignment.
• In addition to vertical alignment, OKRs create horizontal alignment. They may include two or more teams to ensure employees are working toward the same goals and that they do not end up in silos. Furthermore, the key results of one team may become the objectives of another team, or team-level quarterly objectives can be aligned to organization-level annual objectives. This is crucial because many of our deliverables depend on collaboration.

What are some best practices?

• OKRs should be aspirational. One purpose of OKRs is to encourage employees to stretch themselves. Objectives should not be easily obtainable, and if key results are all being met, then they are probably not ambitious enough.
• An industry standard is to aim for a 70% success rate on objectives. We encourage a culture of experimentation where staff feel safe to take calculated risks. When OKRs are working, personal growth accompanies organizational growth.
• For the above reasons, OKRs should not be used as evaluation tools. They have nothing at all to do with performance reviews or compensation. They are about charting a path for organizational improvement.
• OKRs go hand-in-hand with the Agile mindset, which encourages iterative approaches to change. Therefore, OKRs are not set in stone. They can be adjusted at regular intervals, typically quarterly. If we find that either objectives or key results are not helping us to deliver value to our customers, then we can amend them, discard them, or try new ones. 

While OKRs are important for aligning our organizational operations, they are also important for distributing responsibility and handing the keys to those most knowledgeable about each area of our business. OIT might be technology-driven, but it’s people-powered.