Agile Goal Setting. If Agile is the cure, here comes the elixir – OKRs

Agile Goal Setting. If Agile is the cure, here comes the elixir – OKRs

Agile methodology

Companies are realising that traditional project management (waterfall or sequential methodology) is not fully efficient and thus are looking for better solutions to manage their projects. Agile methodology is the cure that has finally helped them get rid of the drawbacks. It is increasingly being adopted by teams from various industries.

Agile Software development

Compared to traditional software engineering, agile software development mainly targets complex systems and product development with dynamic, non-deterministic and non-linear characteristics, where accurate estimates, stable plans, and predictions are often hard to get in early stages—and big up-front designs and arrangements would probably cause a lot of waste, i.e., are not economically sound. These basic arguments and previous industry experiences, learned from years of successes and failures, have helped shape agile development’s favour of adaptive, iterative and evolutionary development (Source: Wikipedia)

Versatility of Agile methodology

While it has proven to be effective for project management, fundamentals of the concept have been found to be useful for various other industry domains/areas. One such area where Agile has been effective is performance management. Companies who have adopted agile over traditional performance management methodologies have seen improved performance visibility leading to higher team engagement, better product/service quality, reduced risk and higher customer satisfaction.

Agile Methodology and Objectives and Key Results (OKRs)

At first glance, both terms may seem unrelated but many similarities exist between Agile methodology and OKR framework. Agile aims to manage projects more effectively whereas OKRs help organisations set and manage goals (in essence, overarching projects) more efficiently. To see the similarities, we need to first what see what are OKRs.

OKRs

OKR is a goal setting framework that was introduced in Intel by Andy Grove. Its philosophy helped the company sky-rocket their employee performance which had a huge impact on the productivity of the organisation. Intel eventually became a household name with their famous ‘Intel Inside’ marketing campaign.

OKR methodology was later adopted by Google in 1999 and has proven to be instrumental in its astounding success. To this day, every level and every department of the company continues to follow OKRs which seems to have a major impact on Google being one of the top companies.

Previously we have seen the concept of OKR and how they work. To recall, the methodology states that objectives need to be set at company level and aligned with individual and team objectives. With each level having a clear understanding of what their target is and how it will help others achieve their’s, teams can perform more efficiently. This leads to a higher productivity and lesser waste of time.

Similarities between Agile and OKRs

Here we’ve listed some of the principles from Agile Manifesto and have drawn parallels with OKRs. Fundamentally, both agile methodology & objectives and key results seem to be extensions of each other. It is imperative that Agile OKRs end up culminating in agile goal setting processes.

Set targets for shorter durations

Agile Principle – Deliver working software frequently, from a couple of weeks to a couple of months, with a preference to the shorter timescale. Setting smaller durations with proportionate targets helps you deliver more.

OKRs – One of the most important features of OKR that separates it from other goal setting methodologies (such as MBO) is the duration for which goals are set. It believes in setting goals either monthly or at most quarterly depending on the individual, nature of work or the current need.

Teams are able to perform better and deliver results more frequently.

Collaborate to succeed

Agile Principle – Projects are built around motivated individuals, who should be trusted.

OKRs – 60% of all OKRs are set from bottom-up and and are later aligned with organisational goals. Managers and their teammates together decide upon individual objectives that are aligned with team objectives and subsequently with company goals. This way everyone is aware of how their goals are tied to other’s goals and fit into the bigger picture. Everyone understands that if there is even one weak link in the chain, their team won’t be able to achieve its target.

Teammates need to trust and motivate each other whenever there is a need.

Focus on Continuous Improvement

Agile Principle – Regularly, the team reflects on how to become more effective, and adjusts accordingly. If there are any bottlenecks that are impeding the flow of work, the teams discuss and identify solutions to remove these and maintain the flow.

OKRs – Managers as well as teammates check in weekly to track their progress and overcome any difficulties that may hinder it. While this is not a necessity, it helps to keep everyone on their toes as well as assure that they can get help/feedback whenever they want.

OKR methodology also recommends setting ambitious goals and it is expected that you achieve around 60% to 70%. If it seems too easy and more than this is achieved, then probably the targets weren’t ambitious enough. Targets can be thus adjusted accordingly.

Simplicity is the key

Agile Principle – Simplicity – the art of maximizing the amount of work not done – is essential.

OKRa – Goals need to be set on frequent basis so they need to be extremely simple. They need to be easily understood and executed. If you have very complex goals, not only will they take up a lot of time for completion, you will most probably miss the deadline.

Frequency of feedback

Agile Principle – Very short feedback loop and adaptation cycle, daily standup

OKR – Since the targets are set for shorter durations such as monthly or quarterly, the feedback too is given quickly. You do not have to wait for an entire year to review performance and find out if the individual or team has been effective or not.

Flexibility to adapt

Agile Principle – Welcome changing requirements, even in late development

For any project, all conditions do not remain constant at all times. Some tasks that may have seemed important initially may no longer be required due to change in perspective or other reasons. You have the flexibility of changing your tasks at any point of time and add new ones as and when required. This can be done at any stage of the project thus saving you valuable time.

OKRs – They are set in such way that they help individuals and teams contribute towards the company’s vision. Though certain situations may demand that one or some of the goals may no longer suit the company’s vision in the near future. In such cases they can be modified or removed and new ones can be set that are more suited for the situation.

Need of the hour – clubbing Agile with OKR

Agile has many benefits over waterfall or sequential models but while there are ways of estimating its value, there are none to track the actual results! Clubbing Agile methodology with OKR can help the company to replace uncertainty with more results based outcome. While one simplifies the process the other helps quantify to what extent the process has been able to deliver. 

If Agile has been the cure, club it with OKR and you’ll get an elixir companies can thrive on. Agile goal setting or Agile OKRs is really the next big thing for companies looking to establish winning ways.