In the article “The perils of bad strategy” the author Richard Rumelt summarizes some key concepts and stories from his excellent book “Good Strategy/Bad Strategy”.
A good strategy does more than urge us forward toward a goal or vision; it honestly acknowledges the challenges we face and provides an approach to overcoming them.- Richard Rumelt
Richard Rumelt writes that a good strategy has a kernel that contains three important elements: a diagnosis that condense and explain a difficult challenge, a guiding policy on which approach you’ll take and constraints you have while trying to overcome the challenge and lastly a set of coordinated coherent actions which together will solve the challenge.
This sounds awfully similar to the Objective and Key Results (OKRs) popularized by the likes of Google at the end of the last century.
OKRs is a very popular framework for setting goals on different levels of a company. It sprung out of Peter Drucker’s “Manage by Objectives” coined in the 1950s and later improved by Andrew Growe over at Intel in the 1960s.
Objectives are a description of how we see the future. A quote that is inspiring, sets a direction that is qualitative and hard to achieve.
Key Results are how we measure results and progress towards achieving an Objective.
Key Results are like latitudes and logitudes in the background of Google Maps. Informing us when we’ve made wrong turns, if we’re progressing as expected and when we’ve arrived at our destination.
If you write your important KRs before you dig deep into initiatives or actions will also help you from jumping to conclusions on how to solve the problem. What if there are multiple ways of getting to the goal? What if you actually arrived at your destination faster by taking another path?
While some part of the Objective states the guiding policy for your strategy, the Key Results are equally important as constraints.
Initiatives are the OKRs way of clarifying coherent actions i.e. What kind of work do we need to do to get us there?
Good strategy gives us clarity and acknowledges the biggest challenges we have a company. OKRs is one great way to clarify and work with that strategy.
OKRs is a bridge between a Good Strategy and Execution.