6 Lessons Learned Over Two Years Coaching OKRs in a Legacy Enterprise

Photo by Thomas Brown: https://www.pexels.com/photo/photo-of-a-moving-train-14038776/

Outcomes, Cadences, Product Management, and Psychological Safety make the difference

I recently appeared on the FitBots OKRs podcast with FitBots co-founder and CEO Vidya Santhanam.

We touched on a wide range of topics across our conversation, centered around the theme of lessons learned using OKRs over the past two years in a nearly 200 year-old legacy Enterprise.

Listen to the full podcast here, or below:

Intro & How Mike Discovered OKRs

Please tell us about your backstory, and how you went on to become an OKRs coach.

I’ve been in IT consulting for about 20+ years, and came to KeyBank almost 5 years ago to help teams with Discovery, Delivery, and Product Management. About 4 years ago, my tech lead / architect on a team I was leading gave me Christina Wodtke’s “Radical Focus,” and I was completely blown away by it. In this slim volume, through an involving story, Christina laid out this incredible way to set goals and work towards them as a team. I was sold. But I had a hard time getting teams to buy into it, for reasons I’ll get into later.

Finally, about 2 years ago, we rebooted our Agile Transformation with the help of a global consultancy, and they also brought OKRs and sold them to management at that time.

After working informally with OKRs, it was a natural fit for me to take over the training and coaching component.

Over the course of 2022, I formalized my education with OKRsTraining.com’s certification, followed by the WorkBoard Outcomes Coach certification, both of which were excellent.

Lesson #1: Defining OKRs, & how they’re different from KPIs

There are various definitions of OKRs, how would you like to best define OKRs for our audience, especially when many find it difficult to discern from KPIs.

OKRs represent goals of movement, achievement, and improvement, and I would describe them as the essence of Leadership.

KPIs represent “acceptable thresholds,” ranges within which we want to keep certain numbers to effectively manage certain parts of the business. I think it’s helpful to call KPIs “health metrics,” and I see them as embodying the essence of Management.

Lesson #2: How to know whether OKRs represent just another management “flavor of the week”

Organizations which have a legacy, would have tried different management practices in the past. How easy or difficult is it to make such a transition to OKRs without being seen as a shiny new penny of management?

One of my favorite questions to ask when starting an OKR implementation is to ask senior leadership:

Why are you doing OKRs? And why are you doing them now?

Providing you get a candid answer, I think this cuts to the essence of how likely OKRs will be to succeed in that environment.

Lesson #3: Introducing OKRs — The First 90 Days

Could you share more about your first 90 days of introducing OKRs? What were some emotions you went through as the Internal OKRs coach to teams at KeyBank?

I was fortunate to work with a few programs across the portfolio, and obviously, the first step was to do some base knowledge sharing, help people understand what OKRs are and how they’re different from other goal-setting frameworks.

We then emphasized with team leadership how to work backwards from program strategy to create at most 1–3 Objectives for each team.

Next, we worked with the Product Managers, tech leadership, analytics subject matter experts, and User Experience people to identify 1–3 Key Results per Objective in more of a bottoms-up approach.

The Product people leading each team became our “OKR Champions,” and crafted their backlogs to deliver against their OKRs.

What sets OKRs apart — Cadence

And this is the key piece, and what sets OKRs apart — I coached teams to check in on their OKRs weekly, reflect on their OKR delivery confidence, and continuously adjust their backlogs to increase confidence, week over week.

My emotions going through these early days were extremely positive — we were finally doing OKRs! I was very motivated and passionate about working on training materials and meeting with teams.

Of course, it was challenging when teams wanted to bring the same legacy Gantt-chart mindsets to OKRs. I didn’t solve the riddle of why some people got it, and others had a hard time, until I started to better understand the importance of Creativity and Strategy in direct opposition to an Analysis & Planning Project Management mindset.

Lesson #4: What teams work best with OKRs?

What did you keep in mind while selecting teams who were to pilot OKRs?

Fortunately, we picked a single Portfolio to start, but I will say not every Program within that Portfolio was well-suited to setting OKRs.

Ideally, you would set OKRs for cross-functional teams who are building new client interfaces and experiences, who are looking to move a specific set of Leading Client Behavior Change Outcome metrics.

We had interesting challenges early on — like how would you set OKRs for a group of software architects? Or a support group? Team where the people in general had no ability to manage their own time?

The answer we learned over time was you don’t.

We learned to set KPIs for those teams for some basic thresholds — number of tickets moved, Service Level Agreements (SLAs), time to first touch, etc..

Lesson #5: Project vs. Product Thinking and OKRs

OKRs make teams aspire towards a path which probably is less trodden; something which brings change, innovation or doing something better. It’s not always that OKRs progress is in Green as we know. What kind of company culture would help OKRs thrive?

Well, I wrote a piece about this point specifically, but Legacy and Regulated Enterprises are dominated by more of a Project Management, Planning, Efficiency, Internally-focused culture, and there’s a desire to only set goals teams can absolutely be sure of hitting.

Simply put, many people get very uncomfortable unless all dashboards are Green, and this is what prevented me from getting teams to adopt OKRs early on.

Unfortunately, traditional Project Management and Waterfall methods are just as bad at predicting the future as any other methods, but we still pretend as though somehow, if we just plan long enough, and analyze enough data, we’ll finally get it right this time.

Misplaced optimism

So there’s a remarkable amount of optimism in traditional Legacy Enterprises in the usefulness of Analysis and Planning.

And I think the success rate of traditional methods is less than 20%, so someone isn’t really paying attention to reality. Those green dashboards that you see everywhere stay green until the day before you’re supposed to go live, when suddenly, everything turns red.

But to your point, your organization will never learn and grow without setting aspirational goals. And when you set those goals, there’s always a chance you’ll aim high and come in lower than expected.

The built-in OKR Reflect, Retrospect, and Re-Set Cadence

With OKRs, this is absolutely fine — you score your OKRs at the end of the quarter, do your Retrospective, and learn enough to set your OKRs for the next cycle.

But with a move to a more Product Management, Strategy, Effectiveness, and Client-focused culture, you can set Achievement-focused goals and work with teams to Discover and Deliver solutions that will increase your confidence of achieving those goals.

Psychological Safety — a prerequisite for innovation

But if organizations don’t have a culture of psychological safety, of risk-taking, of encouraging teams to try new things, and tolerating some yellow and red dashboards, teams will set what we call “sandbag,” easy to achieve goals, and teams will never expand that of which they’re capable.

And I think this was really instrumental to Google’s success early on — the willingness to set moonshot, aspirational goals, check in regularly, and reflect every cycle.

Lesson #6: The cadences and rituals to sustain OKRs

What kind of rituals do you have to sustain OKRs? Are there any interesting stories which you can share with our audience?

For us, we started with weekly internal OKR check-ins to gauge confidence in delivering the Key Results, and then used the bi-weekly Sprint Reviews to share OKR confidence and progress with Executive Leadership.

Over time, added more Scaled Agile events, including a Quarterly Business Review, and a mid-cycle Portfolio-level planning to coordinate across the numerous dependencies that are inevitably part of the legacy Enterprise.

The power of OKRs in action

One story that really impressed me with the power of the OKRs was a team that had set Key Results based on getting a return on investment on something like a thousand dollars per unit sold.

As they checked in regularly, it became apparent the economics were radically different — it was something like an order of magnitude less per unit sold.

This allowed the team to pivot at the end of the quarter, and set new Key Results.

Traditionally, a team like this in the Enterprise would have worked for 6–12 months, heads-down, and only later would they have realized how far off the assumptions were.

So staying focused on the basics, get good training and coaching, and OKRs will definitely provide value.

Parting Notes

Your favorite business book –

For this audience, I’d recommend Christina Wodtke’s “Radical Focus (Second Edition),” and Ben LaMorte’s “The OKRs Field Guide” — the combination of those two books can give you a solid foundation within a week.

I personally wouldn’t recommend aspiring OKRs coaches read John Doerr’s “Measure What Matters,” as it’s more of a cheerleading book for executives to get excited about the idea of OKRs, and not only lacks substance and actionability, but provides some flat-out unhelpful guidance.

When Michael is not at work or coaching teams on OKRs, you would rather…

Be writing, doing speaking engagements, or reading. Otherwise, I like to spend time with my family, meditate, & work out.

Your advice to enterprises introducing OKRs.

My main points would be to stick to the basics:

Get good quality training
Sustain with good coaching
Identify OKR champions internally who will sustain the practice
Set aspirational Objectives.
Learn to collaborate with the team to set Leading Client Outcome Behavior Change Key Results.
Check in on them regularly.
Set your scoring, reset and retrospective cadence, and keep going.
Emphasize progress over perfection.

Your favorite quote that inspires you.

“Faster alone, further together.”

Meaningful goals worth achieving are always accomplished through collaboration and teamwork.

References

Two Reasons Why OKRs Are So Hard In Legacy Enterprises

Michael Goitein