Categories
Leadership

Outcomes Matter

When you are trying to measure what matters, frame it in terms of Outcomes, rather than Outputs. When you start to measure something, then that number will tend to improve as you focus on it. If you are committing to something, then ticking off progress towards is an important way to help you get there.

It’s vital to make sure that the focus is on the actions that end up moving the right needle in the right way. Getting this right can take some time, so it’s worth putting effort in at the start.

The classic example from the tech world is measuring of how many lines of code a particular person has written. It’s a terrible metric, but let’s dig into the why.

Firstly, it’s easy to game. Software engineers can look at this, and just write code that does the same thing in more lines of code. It ends up being counter productive, as you see more complexity for no actual benefit.

Secondly, it’s not linked to the benefits that you are trying to bring to customers. Software exists to solve problems but the number of lines of code is not linked to this. This means the measure is incentivising something that’s not connected to your true goals, which is a bad place to be.

You can run this process with any sort of measure you want to use:

  1. What outcome are you aiming for?
  2. How can you measure progress towards that outcome?
  3. If the measurements are focused on, what behaviours will that drive?
  4. Does that behaviour support the outcomes you are driving for?

If you’ve got good measures that support positive progress to a great outcome, then you are in the right place to move forwards.

You will tend to find that your measures become a bit more complex, as you try to balance multiple behaviours. That’s a positive thing, but make sure to refine them until they are as simple as possible, while still driving you towards the best outcomes.

They’ll also become more specific to your particular situation, which again is a positive as it ties you more closely to the problems that you are trying to solve.

So instead of measuring the amount of code written, you may instead consider how you can help the team make more releases per month whilst reducing the number of issues caused in the production systems.

That’s better, as it’s encouraging fast and small releases, something we enjoy in tech as it reduces risk and means that we can learn faster by putting features in front of customers sooner.

Even better may be to aim to increase revenue, conversion or another core business metric. That brings more of the team together, allows you to focus on solving problems and may results in creative solutions like removing low value of complex features, which you’d never do if you were just focused on writing lots of code.

Focusing on the right outcomes is a powerful driver to positive change and unlocking the creativity of the people you are working with. As a leader that’s a core part of your role, so put the effort in early and reap the dividends of an engaged and highly performing team.

Categories
Book Review Leadership

Measure What Matters

Measure What Matters is John Doerr’s new book outline the theory and practice of using OKRs to drive success and 10x growth.

Objectives and Key Results are a goal setting method that can be used to bring to bear four superpowers:

  • Focus and Commit to priorities
  • Align and Connect for teamwork
  • Track for accountability
  • Stretch for amazing

The basic premise is simple, on a regular cadence, set Objectives that can be measured by a set of Key Results.

Each OKR is made public, they are transparent and shareable. Every person in the company can link their personal OKRs in to the company wide objectives, as an example one of your personal Objectives may tie directly to a Key Result of your team or department’s OKRs, and so on up the chain.

Key Results must truly be measurable, they should be specific, set with a real date and the metric should be unambiguous. ‘Increase active users’ is bad ‘Increase daily active users by 25% by 1st May’ is far better. They don’t cover the how, but are used to define the direction and measure of success.

We must also check in on OKRs regularly, the value is not just that they exist, but that we measure how we are getting to the goal. Looking at the successes and understanding the failures is a fundamental method to ensuring they add the true value they can provide.

John reminds you that OKRs should not be tied back to personal performance reviews. One of the superpowers is the ability to stretch, and OKRs should be set so they are difficult or uncomfortable to achieve. A stretch OKR may only be hit 60% of the time, but if it’s tied to personal compensation, you can be sure it’ll be hit more often. The stretch is so important because hitting 80% of a massive goal is much more rewarding and transformative than reliably hitting 100% of a simple goal

The book is an easy read, with a history of OKRs, how they came to Google and illustrations of their use at a number of other companies. It’s an inspirational guide on how a simple tool can have such significant power. The resources at the end of the book are extremely valuable, especially if you are attempting to set up your own OKR system, so it pays to spend to the time studying these as well as the case studies covering specific areas.

Overall, a great introduction to the OKR mindset, definitely worth picking up, and returning to as you go on your own OKR journey to success.