It’s the time of year when we start reflecting on all the work we did and all the work we’ll need to do in the year ahead. For many of us, that means relying on a popular framework like OKRs (Objectives and Key Results) to guide us through the new year.
It got me thinking about Roger Martin’s critical post on OKRs titled the “OKR Hype Train” and the danger of ceding our thinking to a playbook. In a nutshell, Martin posits that businesses put so much faith in the OKR playbook they neglect developing a thoughtful strategy unique to their circumstances. And without a principled strategy, there’s no good way to decide what work should be done to take us from an “Objective” to a “Key Result”. Martin details how we can shoehorn deep thinking about the company’s strategy between the Os and KRs and solve the “and then a miracle occurs” step made famous in the S. Harris cartoon:
The OKR framework is just one example in a long parade of models that are widely used and which become foundational concepts underlying our shared understanding of how businesses should operate. Other examples include SWOT (Strength, Weakness, Opportunity, Threat), Clayton Christensen’s Disruptive Innovation Theory, and the long list of decision-making models (like DICE, RACI, and DARE).
Over time, previously innovative ways to help people think about markets, business, and work are ritualized and applied without much — if any — reflection on the current context or the limits of the models themselves. That is, of course, the benefit of a model. It offers an abstraction of the situation at hand and minimizes the time and effort required to determine the salient factors of a situation.
In my experience, the shiny appeal of abstract models lies in making decisions through deduction. But deduction relies on starting with facts we know to be true, and in complex systems like businesses, we must work with incomplete information of unknown accuracy and reliability. If the inputs to our models aren’t very good, we must instead rely on something else. I believe we should rely deeply internalized principles to guide us.
One approach to using internalized principles I’ve found helpful is making decisions based on explicit relative values. The approach uses “even over” statements to guide our decision making, like these:
- Employees' wellbeing even over customer satisfaction
- Customer satisfaction even over profits
With these principles in place, a customer support rep can make the decision to give a customer who has an emergency temporary free access to a paid tier of the product knowing customer satisfaction is more important than the profits from a single transaction.
A company, team, or individual can draw upon internalized principles like these when deciding a course of action that will take them from an Objective to Key Results, without resorting to some Harvard Business Review article on strategy.
Martin offers one critical takeaway, when focusing on the missing piece, saying “desire is not strategy”:
"But desire (as with hope) is simply not a strategy. The desire to achieve the named key results won’t cause those key results to happen. You may desire the substantial rise in your NPS, but if you are serving customers that your key competitor serves better than you do, your NPS is unlikely to rise — even though you really want it to. Your strategy is the thing that will cause your NPS to rise or your customer churn to fall, or your customer acquisition to strengthen."
Perhaps this year, before forging ahead and hoping OKRs lead to success, it would be worthwhile to write down your principles and see if they help you navigate the chasm between Objectives and Key Results. Models will never be a substitute for the hard work of strategic thought.