Why most Key Results are useless (and how to fix them - 5/10)

So many OKR coaches will tell you that Milestones need to be avoided at all costs. KRs must have a number or they are terrible!

But hold on, what does Ben think?

Learn about the 3 types of Key Results and think through whether or not you should allow Milestones!

There are three types of key results: metric, baseline, and milestone. Metric key results are the most common. They look like “move metric A from X to Y.” Baseline key results are used when X is not being measured and your client seeks a metric to reflect progress on a given objective. Your client should only put in the effort to establish a baseline if they expect to use that baseline as the starting point for a metric key result in a future OKRs cycle.

Most leadership teams define a solid set of metric key results for top-level objectives. However, many teams struggle to define metric key results.

Dozens of teams send us their OKRs for feedback each year. Their key results often look more like a list of tasks that reflect work output rather than measurable outcomes. Unlike metric key results, milestone key results tend not to include numbers. Milestones are binary—they are either achieved or not. Given that milestones are notorious for reflecting work output rather than outcomes, should milestone key results even be allowed?

Some OKRs coaches advise avoiding milestone key results entirely. On page seven of his OKRs book, John Doerr credits Marissa Mayer with her observation, “it’s not a key result unless it has a number.” However, in this same book, Doerr provides examples of milestone key results such as “develop a demo.” (SEE NOTE AT END)

Marissa might not be happy with this key result! As an OKRs coach, you work with your client to transform draft key results that often look like a to-do list into refined key results that reflect measurable outcomes. Here is a hypothetical OKRs coaching conversation to make this concrete:

Client: My key result is to develop a demo.

Coach: What is the intended outcome of developing this demo? How will we know the demo is a success?

Client: Well, the demo is a success if we can get positive customer feedback, but all I can commit to is developing the demo this quarter. It will be quite a stretch to get feedback.

Coach: OK, what will be demo’d and how will we know it is developed?

Client: We’re developing a demo for product X and our sales team decides if it’s developed and ready to be used. Ultimately, it is our customers that will decide if it’s a valuable product.

Coach: Are you committing to presenting the demo to the sales team or to customers?

Client: I can’t commit to showing it to customers. That is the decision of the sales team. I can commit to presenting the demo to our sales team.

A bit more OKRs coaching might lead to the following refined key result that (1) focuses on outcome, (2) distinguishes between a commitment and a stretch outcome, and (3) specifies what is being “demo’d” and who decides it is “developed.”

type="example"

Key Result: 3 customers sign an agreement to purchase product X after viewing the new product X demo

Commit = present product X demo to our sales team for feedback in our test environment

Target = present product X demo to five prospects with feedback on likelihood to purchase

In this hypothetical coaching conversation, the draft key result, “develop a demo,” becomes the commit level of progress. However, the stretch key result now reflects customer interest in the product. It is the number of customers interested in the product that reflects the needle the client is ultimately trying to move. Marissa would likely approve now that the key result has a number.

As an OKRs coach, you help your client translate milestone key results like “produce a demo of product X” into aspirational outcomes like “three customers sign an agreement for product X” that move a metric rather than simply represent completion of a task. Therefore, we might conclude that all key results should be metrics. However, while we recommend defining mostly metric key results, our clients often choose to define milestone key results as well.

Rather than declaring all milestone key results are bad, we invite you to consider the possibility that milestone key results can be used to reflect outcomes not output. Consider the following two milestone key results one of our clients drafted: (1) Present requirements to obtain a permit to build houses in Portland to leadership team and (2) Obtain a permit to begin new construction in Portland. The first milestone is a task that reflects work output. One person should be able to research required documentation for a permit and schedule a meeting with leadership. However, the second milestone is not a task; it is a potential key result that reflects a binary outcome. Ask questions to guide your client to move from task-like milestones that reflect work output to key results that reflect outcomes.

Coaching Takeaways

• Help your client define mostly metric key results (i.e., move metric A from X to Y).
• If your client is not already measuring the right metric to capture progress on an objective, consider defining a baseline key result. In other words, “find X” so your client can define a metric key result to improve from X to Y in the future.
• Not all milestone key results are bad! Ask questions to help move your client further down the value chain to translate tasks and work output into outcomes.
• Use scoring to convert output milestones to outcome milestones or metrics. As inspiration, use the hypothetical coaching conversation that translated the output milestone, “develop a demo,” into the metric key result, “3 customers sign an agreement to purchase product X after viewing the new product X demo.”

Note:

In reviewing John Doerr’s book, Felipe Castro, an OKRs expert and good friend of mine, notes: “Out of the 60 Key Results listed, 32 (53%) lack numbers. They include things such as “Create a retirement plan for all legacy technology,” and “Focus on hiring player managers/leaders.” Even John Doerr’s own OKRs from his days at Intel lack numbers (e.g., “Develop a Demo”).