You may have heard the maxim, measure what matters. Aside from being good advice, it’s also the title of a very successful strategic management book by John Doerr. The book focuses on the concept of objectives and key results – OKRs, which is an increasingly popular approach to defining organizational performance expectations and measurement criteria.
OKRs were popularized in recent years by some notable successes at organizations like Google and Microsoft. This received lots of attention because organizations are desperate for a better way to plan and execute on their strategic priorities. Strategy execution failure rates vary from one survey to the next, but there is little evidence of any dramatic improvements in the 25 plus years since Kaplan and Norton reported it at 90% in their book "The Balanced Scorecard."
This lack of improvement is clearly not acceptable, and OKRs promise a more straightforward approach that makes it easy to determine whether the objective has been achieved. It also helps to focus the minds of everyone doing the work on what success looks like – the key results that need to occur. But of course, there has to be more to it than that.
OKRs in themselves are just a starting point; where they really make a difference in improving strategy execution is in the changes that they enable in how an organization thinks and operates. They provide a mechanism for communicating consistently with the entire organization, helping to ensure that all stakeholders have a common understanding of what is required and how success will be determined.
OKRs also provide work teams with context for their efforts – not only understanding why their work is being done, but how they will know if they have been successful. Teams have more confidence that the organizational priorities are appropriate because those priorities are tied directly to not only objectives, but also the determination of whether those objectives have been achieved.
To put it simply, OKRs make everything around strategy easier and more straightforward. When things change, as they inevitably will, those changes are easy to understand based on the delta between the original and revised OKR, and that in turn allows for adjustments in delivery to occur more quickly and with less disruption.
The only reason that more organizations aren’t leveraging the opportunities presented by OKRs, is that they haven’t been able to do so effectively. That’s where ServiceNow comes in. Not only does our Goal Framework for Strategic Portfolio Management (SPM) support OKRs, the SPM solution makes the communication of those OKRs to all stakeholders simple and straightforward. Because ServiceNow SPM supports work delivered in all methods – traditional, agile and hybrid, teams can operate in any way that they choose and be clear about what has to be achieved.
Because our SPM solution is integrated with the Now platform, strategy execution isn’t simply an overlay to how the business is run, it’s an integral part of it. This ensures that there is seamless transition from project, product, epic, program, etc. to operations, and that new demand feeds prioritization and planning effectively. With ServiceNow, OKRs can be a real differentiator.
