OKR Approaches

Numbers, Relationships, Systems

I often say, "There are different approaches to OKRs and not just one way to apply them," and recently I’ve wondered, what does that mean exactly?

I have been working with OKRs for years now, and over time, I have had the chance to talk and compare notes with many different people somehow interested in the topic (colleagues, people in companies that use them, participants in the courses we held, curious individuals who have not yet delved into it, etc.).

All these discussions have made it clear that OKRs are applied in different ways, giving rise to approaches that, while preserving the core of the methodology, focus on different objectives to achieve (the use of "focus" and "objectives" is not accidental in this sentence 🙂).

In fact, I must admit that until a few days ago, I never had a clear understanding of how this difference materialized. However, the picture became much clearer in one of the last conversations I had on the subject at the WMF.

By nature (I am an engineer by training), I tend to create clusters to explain phenomena to myself. Although not precise, these clusters allow me to orient myself and perceive most of the sense I want to express in this case.

Now, let me tell you about the three clusters of OKR approaches I have identified.

Analytical Approach 

A heavily numbers-based approach where OKRs are interpreted as a tool to identify, monitor, and act on the company’s key numbers, orienting business actions towards this goal and the achievement of targets. In this conception, the process of implementing and executing OKRs is quite deterministic and defined, revolving around the constant recording and evaluation of the company’s key metrics in relation to the targets to be reached for those metrics over the period. Reviews (check-ins or cadence reviews) focus heavily on numbers and the activities done or to be done to move them toward the defined target. In this case, having software tools and data collection and analysis systems aimed at simplifying the calculation and constant monitoring of key data is particularly important. It is also absolutely necessary that the organization is culturally inclined to work with data and that everyone is aligned on the meaning of the chosen metrics.

Relational Approach 

This approach prioritizes the use of OKRs as a tool to connect people and departments to increase collaboration and improve communication. In general, it is used to improve the overall relationship within companies. To get the most out of this approach, it is essential that activities are followed by one or more coaches (rather than consultants) to favor the development of relationships aimed at achieving objectives. In this case, numbers and targets take a back seat, and the ultimate goal of implementing the methodology is to nurture and grow relationships between various elements of the company.

Systemic Approach 

This final view sees OKRs as functional to the introduction of a new working method within the company. In particular, they are used to promote a bottom-up approach in strategic definition and execution. According to this approach, which is the one we mostly apply at Redlab, OKRs are used to bring about positive transformation in the company’s operational and governance practices. In this view, it is essential to enable the distribution of decision-making authority and a bottom-up approach to defining objectives and KRs to increase motivation and ownership (see Daniel Pink and the principles described in his book "Drive”). This allows for greater team autonomy and better alignment between all elements of the organization towards a common goal. 

Approaching the methodology systemically essentially means allowing the organisation to change its way of working and start this change from alignment and sharing of objectives (where sharing means everyone is perfectly clear about what they do to achieve them and what their impact is).

To ensure that change happens and the organization embarks on a path of continuous evolution, constant quantitative (how teams are progressing towards targets) and qualitative (learning aspects are crucial) alignment between people and teams is necessary. 

We prefer to carry out the first asynchronously, while the second is done synchronously through meetings designed specifically for the purpose, of bringing out all voices and disseminating the qualitative aspects of the progress made.

It is important to note that none of the approaches is exclusively focused on the described aspects, but what is described is the main focus of each approach and what is most emphasised in the application of OKRs by those who favour it. 
Another important note is that there is no better or worse approach, but only one that is suitable for the purpose you want to pursue.

I have always thought that OKRs, beyond some key points of the methodology, should not be applied in a static and rigid manner but adapted to the goals you want to achieve. I have always been convinced that the key to success in implementing OKRs lies in the ability to adapt the methodology to objectives and organizational context. If this is done well, the flexibility of OKRs allows companies to evolve and adapt continuously, always keeping objectives clear and fostering a culture of continuous improvement.

The above considerations are related to what I have seen happen in the part of the world I have observed in these years of working with the method, but they are far from being “the truth” or “definitive.” 

The reason I wrote this piece is actually to open a discussion and comparison on the topic. 

So, I would like to know your experience and the approaches you have seen adopted in the implementation of the methodology. Are they similar to what I have seen happening?