Agile Goal Management and Modern Employee Leadership with OKRs
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Patrick Lobacher gave a presentation on Objectives and Key Results (OKRs) as a framework for agile goal management and modern employee leadership. He discussed how traditional management processes are outdated and how OKRs provide an agile alternative for setting strategy and aligning employees. OKRs involve setting qualitative objectives and quantitative key results at the company, team, and individual level to focus efforts on priorities. Examples were provided of how OKRs have been implemented successfully at various companies.
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Agile Goal Management and Modern Employee Leadership with OKRs
- 1. Objectives & Key Results Agiles Zielmanagement und moderne Mitarbeiterführung mit OKR Patrick Lobacher 28.06.2017 1 Agile Leadership and Goal Management with Objectives & Key Results (OKRs) 29.08.2017 | ALE2017 Patrick Lobacher consulting
- 2. Let me introduce myself Patrick Lobacher “living“ agile since 15 years CEO of pluswerk.consulting Consultant, Trainer, Author, Coach 2
- 3. Website: pluswerk.consulting / okr-beratung.de 3 Innovations Design Thinking Lean Startup Lego Serious Play Business Model Canvas Lean Canvas Value Proposition Design Google Sprint Open Innovation Objectives & Key Results 4DX Working Out Loud New Work Management 3.0 (Agile) Team-Development Future/Agile Leadership Leadership-Coaching (Agile) Strategy Development Organisational Development Process-Management / - Consultancy Change Management Culture Development Agile Maturity Level (AML) (Big Groups) Moderation Agile / Lean Consulting Persons Organisations Coaching / Training / Consultancy / Education/ Sparring / Mediation / Train-the-Trainer / Conception/ Audit Passionate Consultancy for Agility and Innovations
- 4. 4 References (>60 OKR projects in 4,5 years)
- 5. 5 Selection of companies which use OKR... +Pluswerk AG | Accenture | Adobe | Amazon | American Global Logistics | Anheuser-Busch | Asana | Baidu | Box | CareerBuilder | Capco | Cap Gemini | Daimler | Datto | Dell | Deloitte | Department of the Navy | Deutsche Messe AG | Domo | Dropbox | Ebay | EDEKA | Edmunds | Eli Lilly | Europace | Eventbrite | Facebook | FiServ | Flipboard | Gap | GE | Google | GoPro | InsideSales | Instructure | Intel | ISO Energy | Juniper Networks | Kelly Services | KupiVIP | Lamudi | LG | LinkedIn | Lookout | Lumeris | Malwarebytes | Meetrics | microfin | Microsoft | mobile.de | Mozilla | MyMuesli | Nerd Wallet | Netflix | Oracle | Panasonic | Paperless Post Rackspace | Red Bull | Salesforce.com | Samsung | Schneider Electric | Sears | Siemens | Slack | Spotify | Splunk | Stylight | SunEdison | T-Online | Tableau | trivago | trusted.com | Twitter | Uber | UpWind Solutions | Viacom | Vmware | Vox Media | Yahoo | YouTube | Zalando | Zendesk | Zynga | ...
- 6. 6 Always start with the WHY... Why OKR?
- 7. 7 The problem... Your company has 21st-century technology, mid-20th-century management processes, all built atop 19th-century management principles. (Gary Hamel)
- 8. 8 One example... Frederick Winslow Taylor „Taylorism“ (1910) „Scientific management“ Complete separation from manual and headwork
- 9. 9 Another example... Peter Ferdinand Drucker „Management by Objectives“ (1954) • Review organisational goal • Set worker objective • Monitor progress • Evaluation • Give reward
- 10. 10 Even more examples... Departments Hierarchy Project Management (waterfall) Annual target agreement Managers Bonus Management by Objectives Budget processes Processes (most of them) Job titles Chiefs
- 11. 11 But wait... We are agile!!!!
- 12. 12 But wait... We have Scrum Kanban Design Thinking Lean Startup ... !!!
- 13. 13 But wait... But what is with: Goals? Ahhh – we have MbO (Management by Objectives)!
- 14. 14 “We basically unplug anything which is anual. The notion is that, in the digital age, sitting down once a year to do anything is weird, it’s just bizarre.” Jeff Immelt, CEO GE, 2015 What’s wrong with MbO?
- 15. 15 “Allthough we are using agile tactically, we are using waterfall for strategy and goal setting” Felipe Castro, 2016
- 16. 16 Strategy (Goals) 1% “Doing the right things” Execution 99% “Doing things right” 30% fail when trying to coordinate their units 40% fail with the alignment Why Strategy Execution Unravels, HBR - 2015 - https://hbr.org/2015/03/why-strategy-execution-unravelsand-what-to-do-about-it The problem is in the execution!
- 17. 17 OKRObjectives & Key Results Now it‘s time for „MbO 2.0“
- 18. 1983 Andy Grove 1999 John Doerr 1999 Google 2012/2013 Google Ventures History of OKR 18 Management by Objectives (MbO) S.M.A.R.T. KPI BSC OKR-Companies • worldwide • all branches • all sizes
- 19. OKR overview Objectives & Key Results Qualitative goals & Quantitative goals Where do I want to go? & How do I get there? Short iterations Focus Alignment Transparency BottomUp goals Vision 19
- 20. 20 „OKR is a critical thinking framework and ongoing discipline that seeks to ensure employees work together, focusing their efforts to make measurable contributions that drive the company forward.“ (Ben Lamorte) (One) Definition of OKR
- 22. Context of OKR Goal Management Leadership Agility Performance Management Vision OKR PM Doing 22
- 23. Vision (MSC) Moals OKR CycleOKR Planning Weekly OKR OKR Review Retros- pective OKR-List OKR Master Standard OKR Extension pluswerk.consulting 3 - 10 year 1 year 3-4 months OKR-Framework 23
- 24. 24 Experte Coach Facilitator • The OKR Master is the expert for the OKR process in the company. He/She takes care of the implementation and the daily use of OKR within the organization. The OKR Master is also the contact person for every question regarding OKR and takes care of removing any impediments. • The OKR Master covers the following five roles: Watchdog Change Agent Servant Leader The roles of the OKR Master
- 25. 25 OKR „Revolution“ „Goals“ Company Goals Manager 1 Goals Employee 1 Goals Employee 2 Goals Manager 2 Goals Manager 3 Goals Employee 3 Goals Employee 4 Vision Mission Goals BU 1 Goals Team 1 Goals Team 2 Goals Department 1 Goals BU 2 Goals Team 3 Goals Team 4
- 26. 26 Advantages of OKR • develops to a result- and value-oriented culture • gives autonomy to the teams in terms of the goal management • strengthens self-organizing teams • helps to keep focus and focuses on priorities • increases productivity and satisfaction • enables and supports the “Agile Transformation” and the “Digitale Transformation”
- 27. OKR example – Foodscore AG 27
- 28. 28 The company Foodscore AG • Online price comparison portal for foods • 2 locations • 250 FTE employees • Organizational chart: CEO Finance Marketing Sales Development HR
- 29. 29 Cascading of the OKR-System Mission statement Mid-Term Goals Comapny OKR Finance- Team OKR Marketing- Team OKR Sales-Team OKR Development- Team OKR HR-Team OKR 3-10 years Team OKR 1 year 3 months In this example, there is no third level of departmental OKR, but the company's OKR derive directly from Team OKR. In the real case there would be clearly more OKR teams.
- 30. 30 The Mission Statement of the Foodscore AG Vision Mission „Cheap food for everyone“ "Foodscore enables everyone to find every food at the best price and act independently and transparently"Note: The Vision + Mission is quite "simple". This can be further expanded in the real case.
- 31. 31 Cascading of the OKR-System Mission Statement Mid-Term Goals Company OKR Finance- Team OKR Marketing- Team OKR Sales-Team OKR Development- Team OKR HR-Team OKR 3-10 years Team OKR 1 year 3 months
- 32. 32 Mid-Term Goals (MOALS) What are the medium-term milestones that must be achieved next year to pursue the mission statement further? Moal 1 Foodscore should be accessible from any device Moal 2 The popularity of Foodscore is expected to increase drastically this year Moal 3 Funding for business development is to be procured Comparison with mission: accessibility for everyone Comparison with mission: preserve independence
- 33. 33 Cascading of the OKR-System Mission Statement Mid-Term Goals Company OKR Development- Team OKR Marketing- Team OKR Sales-Team OKR Finance- Team OKR HR-Team OKR 3-10 years Team OKR 1 year 3 months
- 35. 35 Company OKR (Objectives) Qualitative and higher-level Objective 1 We want to understand the customer better Objective 2 We want to reach more consumers with our offers Objective 3 We want to work more productively Universally doable in one cycle Balance of inspiring and achievable Aligned to vision Comparison with mission: accessibility for everyone
- 36. 36 Criteria for key results
- 37. 37 Company OKR (Key Results) Specific AcceptedMeasurable Realistic Ambitious but doable Aligned Time- bound Objective 1 We want to understand the customer better Objective 2 We want to reach more consumers with our offers Objective 3 We want to work more productively KR 1 Analyze the 5 biggest customer groups Use 5 new marketing channels Learn & experience 5 agile methods KR 2 Get 100 qualified feedbacks from customers Generate 50 content chunks in all marketing channels Digitalize 5 processes KR 3 Analyze 20 cloud competitors
- 38. 38 Cascading of the OKR-System Mission Statement Mid-Term Goals Company OKR Development- Team OKR Marketing- Team OKR Sales-Team OKR Finance- Team OKR HR-Team OKR 3-10 years Team OKR 1 year 3 months
- 39. 39 Development Team OKR Objective 1 Address mobile devices Objective 2 Increase code quality Objective 3 Simplify of user interface KR 1 At least 50% of all views should be responsive Introduce unit tests for at leat 50% of all functions Structured interviews with 100 user KR 2 Make plattform accessible on 10 of the most used mobile devices Introduce at least 20 frontend tests Repair the 10 most common defects in the interface KR 3 Analyze 20 cloud competitors Specific AcceptedMeasurable Realistic Ambitious but doable Aligned Time- bound
- 40. 40 HR-Team-OKR Objective 1 Complete Sales Team Objective 2 Introduce Agile Working Methods Objective 3 Introduce OKR KR 1 Create job description - Match demand profile with sales (50%) - Publication on 5 relevant job portals (50%) Identify 5 agile methods and do a company fit Indentify 3 OKR Consultancies KR 2 Start pilot with 3 new agile workshops Build up a OKR- Committee (5 persons + C- Level) Specific AcceptedMeasurable Realistic Ambitious but doable Aligned Time- bound
- 41. A few numbers... Low RetentionHigh Retention No Retention 15% 70% 15% (Emotionale) Employee Retention • Gallup Organization (since 2001 Engagement Index in Germany) • 15 Percent of the german employees were satisfied with their jobs in 2016 • 70 Percent mare doing „Call of duty“ • 15 Percent have mentally resigned • Damage for „mentally resignation“ with 500 employees: 1,3 Million EUR per year • Fluctuation costs with 500 employees: 675.000 EUR per year • Ben Lamorte (Study with 20.000 employees) • 3% increase in performance level with minimal (but consistent & qualitative) use of OKR • 11.5% increase in performance level with maximum use of OKR • 8.5% increase in sales per employee with consistent use of OKR 41
- 42. Full Stack OKR (@scale) ComplexityofOKR setup Agile maturity of company Vertical Alignment Effective Retrospectives Horizontal Alignment (High) Self- Organisation Full Transparency Extended Cadences Simple Goal Management Enterprise OKR Monetary Decoupling Instant Feedback Lead / Lag Measures Health Measures Valuable Goals 360° Alignment Goal Grading Agile Goal Management Gamification Personal OKR Ambitious Goals Agile Strategy 42 OKR-Master Integration in all Processes Stretch Goals OKR Software OKRs of OKRs Simple Tracking
- 44. Next steps in OKR... OKR-Trainings: 04.09.17 / MUC / OKR KOMPAKT-TRAINING 04.-06.09.17 / MUC/ CERTIFIED OKR-MASTER TRAINING 10.10.17 / BER / OKR KOMPAKT-TRAINING 06.11.17 / DOR / OKR KOMPAKT-TRAINING 06.-08.11.17 / DOR / CERTIFIED OKR-MASTER TRAINING 12.12.17 / MUC / OKR KOMPAKT-TRAINING 12.-14.12.17 / MUC/ CERTIFIED OKR-MASTER TRAINING http://www.okr-beratung.de/okr/okr-trainings/ 44
- 45. 45 The OKR Compendium 09th of August 2017 214 pages https://leanpub.com/okr/
- 46. Objectives & Key Results Agiles Zielmanagement und moderne Mitarbeiterführung mit OKR Patrick Lobacher 28.06.2017 46 Thank you very much! Questions? www.okr-beratung.de consulting
- 47. Contact 47 Christian Jacob christian.jacob@pluswerk.consulting +49 89 244 179 66 Patrick Lobacher patrick.lobacher@pluswerk.consulting +49 89 244 179 66 Magnus Schubert magnus.schubert@pluswerk.consulting +49 2204 842662 pluswerk.consulting +Pluswerk Consulting GmbH Oetztaler Str. 1 81373 München T: +49 89 244 179 66 info@pluswerk.consulting pluswerk.consulting www.okr-beratung.de