Killing ambiguity with OKRs

We discussed good practices and anti-patterns of organizational goal setting, the ones that create psychological safety and the ones that produce a negative impact on employee morale and autonomy. Below is a brief summary:

1. The goal of OKRs is to establish cascading organizational objectives so that everyone in the organization is aligned against the same set of priorities. It helps with dependency management and prioritization at any level.

2. OKRs differ from KPIs because they are not used for performance evaluation. This would be an anti-pattern and cause OKRs to be non-ambitious or to game metrics. It is important to establish a shared understanding that no one can use OKRs to evaluate individual or team performance.

3. OKRs are bi-directional: management establishes organizational and divisional objectives, and teams base their objectives on organizational priorities. Then there is a pass to align on dependencies and any prioritization conflict. Once this is done, the organization shares the same understanding of priorities and delivery values.

4. OKRs are inspirational in nature. Objectives are aligned with company’s mission and vision, and key results contain metrics to support these objectives.

5. OKRs are self-graded. The standard scale is from 0 (blocked) to 1 (fully achieved). 1 means OKRs are not ambitious enough. Ideal grade is around 0.75 but it is meaningless as a number. The role of grading is to promote meaningful conversations about the reason for some OKRs to fail and join alignment on challenges and achievements.

6. Finally, we discussed ongoing feedback approach that Vistaprint is implementing. Each employee manages their own feedback and coordinates retrospective-style feedback sessions with their stakeholders. They define the frequency and choose the format. The feedback is actionable and received as a gift. Self-managed feedback is a way to give to employees the right to be accountable for their own professional development while supporting them on this journey. However, this data goes into HR system and is being used by managers for performance reviews and compensation decisions. There is a lot of training within the company or accepting and giving feedback, as well as on the changing role of managers who now coach and support their teams rather than command-and-control them.