I have been using OKRs to set goals and align on priorities for the last 5 years, first at Directi and then at Gojek. I have seen how sophisticated OKRs planning has become over time, from simple delivery focused KRs with a date assigned to detailed principles and narrative driven ones. Below I write down the different levels of OKRs setting. Level 1 is how a team who is just starting with OKRs will practice them. Level 8 is where I want to reach. I think my team is at level 7 now.
- Level 1: Most KRs will be around shipping features. This is mostly founder driven. They already know what they want to do. Meeting KRs essentially means delivery.
- Level 2: Same as Level 1 but with delivery dates for features.
- Level 3: You realised that simple feature delivery can’t be a KR. So you align on moving metrics instead of shipping projects.
- Level 4: You don’t just focus on metrics, but also think about projects that will help achieve them. These projects are kept in the Initiatives section.
- Level 5: You realise that you have become metrics driven, but somehow you end up missing your KRs. Also new projects keep coming and instead of focusing on the KRs and their initiatives, you end up doing the new ones. Soon people stop caring about KRs. This realisation is very important. You bring flexibility. You say that hitting 70% of KRs is fine. You keep some room for ad hoc changes.
- Level 6: After a few cycles of 5, you realise that initiatives are too low level. And there are too many of them, without them tying to any coherent theme. So you focus on 3-4 high level themes instead of 10 project initiatives. Then you map those themes to possible initiatives from your backlog. Estimate impact of these themes. Estimate impact of these themes on your north star as well as other high priority metrics.
- Level 7: You realise that till now you have been obsessed on moving output metrics that are lagging indicators. You decide to focus more on input metrics. You set principles for setting OKRs. Focusing on input metrics over output metrics is one such principle. Then you identify themes based on these principles. Find initiatives that map to those themes. You set KRs around input metrics.
- Level 8: Instead of having semester/quarterly OKRs that feel disconnected, you realise the need of a long term narrative. All companies have long term plans, typically 2 years+. Create a narrative around how you will help your company achieve that long term vision. If you have a 2 year plan for your team and you are at the 1 year mark, do a retrospective. Ideally do retrospective for every OKRs cycle. Keep checking progress. Align management on the progress. Do all the other things mentioned in level 7.