The Product Strategy Samurai. Image via Midjourney.
Are you Product Managing or Project Managing?
This piece originally appeared in the Product Coalition publication on Medium.
Since first working with Objectives and Key Results over 4 years ago, I’ve seen first-hand how they’ve gone from the “secret weapon” of Silicon Valley unicorns to increasing mainstream adoption.
Although initially used exclusively in tech products, they’ve now been adopted across nearly every product category, from aerospace, financial services, to healthcare and hospitality.
But over time, with that enthusiasm, I’ve seen a growing chorus of backlash.
“OKRs don’t work here”
As we’ve seen with Agile, Scrum, Kanban, and SAFe in product development, OKRs can be misused, and create more dysfunction than benefit.
I believe there’s a central reason for these problems that’s actually upstream from the framework itself that’s causing OKRs to fail:
You can’t set goals in isolation. You need to start from a clear product strategy.
Where the gap really lies
And I believe one benefit of the widespread adoption of OKRs and the associated pushback is that it exposes some fundamental strategy gaps common across many product organizations.
Here are two fundamental product strategy problems I’ve seen that spell at best, mediocrity, and worst, failure for any OKR implementation:
- Not being clear about your product strategy before setting your OKRs
- Using OKRs to plan out tasks
1. Not being clear about your product strategy before setting your OKRs
Goals vs. Strategy
Despite what you’ve heard, there’s nothing “magic” about OKRs — they represent nothing more than a goal-setting and measurement framework, a form of “Enabling Management System.”
When grounded in thoughtful strategic choice-making, OKRs can push teams to aim high and break through boundaries in striving to solve client-centric problems.
This is Product Management
When Product Managers align OKRs to an empowering set of well thought-out strategic choices, they can
- Make the most of their team’s and organization’s strengths through “Must-Have Capabilities” and “Enabling Management Systems”
- Coupled with well thought-out approaches to creating competitive differentiation (your “Where to Play” and “How to Win” choices) that lead to unique and innovative products.
But goals without a complete and intentional product strategy amount to nothing more than hope, and hope is never a strategy.
You already have a strategy
Whether you’re aware of it or not, it’s important to accept that your company and your product already have a strategy.
It may not be what you claim your strategy is, but it’s clearly expressed in the set of choices that guide what you’re already doing, and what you decide to prioritize.
Is it intentional, organized, and focused?
Making choices
One of the core competencies of Product Management is strategic thinking.
Some Product Managers may find themselves in organizations that reserve strategy only for the highest levels of the company hierarchy. Those leaders may even have a clear strategy, but may not be communicating it consistently.
Ironically, many of these same leaders then turn around and blame their Product Managers and their teams for “not executing.”
Product Managers at any level can and should take the lead role in strategy choice-making for their products.
Taking control of your choices
“If you want to improve from your current outcomes by improving your strategy, it is absolutely essential to know what your current strategy is. … For this reason, by far the most productive way to start work on strategy is to reverse-engineer your current strategy.”
Roger L. Martin, Strategy is what you DO, not what you SAY
Before any OKRs get set, at the very least, we need to understand the current set of strategic choices guiding your day-to-day product decisions.
Product Managers can lead this process by coming up with the answers to five questions.
The Strategy Choice Cascade
In stepping the Strategy Choice Cascade with a diverse, cross-functional group to share in the strategy reverse-engineering process, everything you need to understand the crucial components of your current strategy will fit on a single sheet of paper.
There’s no need to outsource this to a consultancy to run a “playbook” over a months-long, drawn-out engagement, only to be left with a slick, cookie-cutter “strategic plan” for your product, spread over hundreds of PowerPoint slides filled with charts, graphs, and budgets.
Simply take the time to step through each of the five boxes in the strategy reverse-engineering process with a cross-functional group to give you a clear snapshot of your current choices.
2. Using OKRs to plan out tasks
In cultures that reward efficiency above all else, lengthy analysis and planning cycles take up an entire season.
Product Managers in these organizations are rewarded for using purely internal and analytical approaches to problem-solving
Inevitably, the Objectives and Key Results these teams produce amount to little more than lists of tasks.
OKRs as an Enabler
If we think of OKRs as an “enabling” management system, we ideally use them to set and measure changes that indicate the effectiveness of your strategy.
With task-list OKRs, we won’t be able to measure anything but whether we’ve crossed an item off our to-do list.
Product Managers in these organizations create and work under Key Results that look like this:
- Deliver system upgrade
- Increase number of data sources from 2 to 7
- 50% of User Stories delivered
It’s not the worst thing, but using OKRs to set to-do lists is like flying a helicopter to get to your corner coffee shop.
You’re taking on far too much overhead to plan and measure a bunch of outputs, where you could simply list out things you want to do over a simple problem-based product roadmap.
If you’re doing task-list OKRs, you’re not doing Product Management
While task-list OKRs can be OK as a first step, it’s important to understand all you’re doing is internally-focused ProjectManagement.
The analysis and planning required for Project Management is still an important skill, so don’t beat yourself or your company up for that, but be honest it exists and be aware of it.
As you take advantage of the built-in cycles of check-in, review, retrospection, and re-setting, you can gradually start working towards a more client-centric set of clear strategic choices.
This will allow you to increasingly align your OKRs to measure your client behavior change outcomes that demonstrate the effectiveness of your product strategy.
Strategy, OKRs & the “missing middle” level of the Product Value Stack
One helpful mental model I’ve developed that has helped many Product people I’ve coached take a more client-centric and Outcome-focused view of their work is what I call the Product Strategy/Value Stack.
We connect, top to bottom, the full value chain and strategy stack, laying out our assumptions in how we propose to connect lagging Business Impact goals at the top, through Strategy Outcomes, and down to team Outputs.
- Business Impact — Impact measures the contributions our product makes towards Corporate / long-term Strategic Goals over longer time horizons
- User / Product Outcomes — Because client behavior is out of our control, we use creativity to design strategy to get clients to increase desired Behavior Change Outcomes in our product. Ideally, you’ll set your OKRs at this level.
- Team Outputs — This is the realm of Project Management. We’re in full control of our teams’ efforts and what happens here. Project Management makes use of Analysis and Planning to map out tasks & activities to produce these Outputs. Ideally, we wouldn’t set OKRs at this level.
Note that as you progress from bottom to top, you have less and less control over what happens.
As Product Managers, your role is to understand what you’re in control of at the bottom layer of the stack and use strategy to influence outcomes in the middle layer.
If we’ve set effective product strategy, we can increase the probability of achieving our lagging Business Impact goals at the top layer.
OKRs at their best
At their best, OKRs can represent:
- An effective communication tool
- A shorthand for progress against our strategic choices
- A powerful tool for learning with built-in cycles of reflection and course-correction
- A way to test and measure whether our product strategy can create delighted clients in a way that produces business value
- A way to set inspire, to set goals and push those boundaries of improvement, of problem-solving, of what’s possible
This is what made OKRs so effective at Google — it allowed them to push, innovate, and radically expand the boundaries of the possible.
TL;dr: The OKR Strategy Miss Takeaways
If you’re using Objectives and Key Results now, how’s your implementation going?
Are you doing Product Management, or Project Management?
The pain of OKRs
If you’re using OKRs for planning, you’re turning a jet engine into an accounting exercise, so don’t be surprised if OKRs fall flat for your org.
What could be more demotivating and disabling than when a team is blocked by internal dependencies from delivering the single task that means they made their OKRs this quarter?
The promise of OKRs
When working from strategy and outcomes, OKRs can instead represent
- A truly “Enabling Management System,” both inspiring and measuring the effectiveness of your product strategy
- A way to build in cycles of continuous reflection and learning
When implemented well, OKRs can provide a shorthand, a quick, top-level glimpse into how your strategy is gradually becoming real.
Two questions to ask
- How might we more effectively design, clarify, communicate, and align around our strategy?
- How might we use our OKRs to measure our effectiveness in delivering against that strategy?
Steer the ship
Start by reverse-engineering your current product strategy.
Once that’s clear, align OKRs to the desired client behavior change outcomes that will let you know you’re going in the right direction.
As they’ve done for Silicon Valley’s best companies, OKRs can power your organization towards new heights, but only if you’re not “hoping” for them to happen, or “planning” them to death, focusing only on what you control.
Take control of your strategy choices to harness the rocket fuel OKRs can truly be.
References
The “Playing to Win” Framework — Part III — The Strategy Choice Cascade
In this piece, I introduce the Strategy Choice Cascade, and use it to reverse-engineer the product strategy for one of my favorite products, the OŪRA ring.
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