OKR should be ambitious and significant, yet still realistic and not demotivating. This is a delicate balance that requires practice from any individual.
The rule of thumb: OKR should be difficult, but not impossible.
According to Christina Wodtke, the author of Radical Focus:
"As you set the KR, you are looking for the sweet spot where you are pushing yourself and your team to do bigger things, yet not making it impossible. I think that sweet spot is when you have a 50/50 shot of failing."
Finding this sweet spot should not be a matter of guesswork. Track records, historical data, and projection should be taken into consideration to make a calculated and informed decision.
The practice of setting ambitious goals that is defined with the 50/50 shot of failing is called stretching.
The importance of stretching
One case study to illuminate the importance of stretching is Google and their Google Chrome project. Let's trace the steps of Google all the way to 2008 to understand why and how OKR practitioners should stretch.
2008 marks the launch of Google Chrome, a cross-platform web browser developed and owned by Google. Let’s take a sneak peek to the ambitious Objective and Key Result (OKR) set for the Google Chrome Project in its initial year:
20 million was not a random number. According to Sundar Pichai, the then Google's Vice President of Product Development, "we deliberately set the bar for 20 million weekly active users by year’s end, knowing it was a formidable stretch."
The team might have been comfortable at 17 or 18 million seven-day active users. Had they chosen to use either of that number, it would not have pushed them outside of their comfort zone. Their principle was to challenge the team without making them feel the goal was unachievable.
Fast forward to December 2008, they did not manage to achieve their OKR.
Given the particular failure, a conventional leader would set a lower aim for the upcoming year. That doesn’t apply to Google, of course. In 2009, the team kept the same Objective, while stretching their Key Result even further, looking to cater to 50 seven-day million active users.
The result? Google Chrome only managed to reach 38 million active users in its second operational year, falling 12 million short of the goal.
Once again, they failed.
If we were to look at these incidents from 2008 to 2009 separately, they would think something was wrong with Google because they failed to reach their OKR two years in a row.
However, through an OKR perspective, situations like these are not marked as defeat. The key is by looking at them together from a holistic approach.
An additional 18+ million (<20 million in 2008 and 38 million in 2009) active users, in fact, is huge progress. Imagine what would happen if the Google Chrome team decided to just recycle their first year’s goal of 20 million users. Without a stretch of Key Result, they would settle on a low bar and work on achieving 20 million seven-day active users once more. Conversely, when they set a higher aim of 50 million seven-day active users, an atmosphere of ambition and expectation for improvement is established, encouraging themselves to aim for greater numbers.
Unlocking new potential
Setting ambitious OKRs means having to think of how to do things in a different, more effective way. But, given such a challenge, what if the team fails?
Oftentimes than not, it is understandable and reasonable that people fail to achieve their KRs after a stretch. It is also understandable for team members to feel discouraged upon such failure. Thus, it is important for a team leader or manager to change the way failure is framed. Taking the example of Google Chrome, the team took exemplary action upon their failure to achieve 20 million seven-day active users. Instead of giving up on their Objective, they changed the way they frame and communicate their situation into a narrative best described through the following sentence:
“We might have not reached our Objective, but we have successfully laid a solid foundation to break through this barrier.”
Remember: this change doesn't exempt one from failing. However, the point is not to avoid failure, but to leverage the lessons from past, unsuccessful OKR attempts to become better. After reframing the failure that happened, the next step to take in order to avoid repeating the same mistakes is to ask yourself and your team: what are we going to do differently?
By asking what we should do differently, we give ourselves and our team the chance to explore new perspectives and find new solutions.
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