OKRs for agile transformation

“What gets measured gets done” is an often-heard expression in business and this concept speaks to why OKRs help enable the agile approach.

To achieve greater business agility, an organization needs clear goals to work toward and a clear plan for accomplishing them. OKRs provide a strategic framework to align teams, resources and priorities, enabling an organization to meet the challenges of agile and digital transformation.

OKRs are widely used for their ability to drive focus and accountability around key priorities. OKR methodology was first introduced at Intel by Andy Grove in the 1970s and popularized by Silicon Valley venture capitalist John Doerr in his book, Measure What Matters.¹

Becoming an agile organization is an aspirational goal for many businesses. OKRs help organizations become agile by providing a framework that offers numerous benefits, including:

Agile is a project management technique that helps deliver continuous improvement, encourage greater collaboration from all team members and boost efficiency. While agile methods were originally used for software development, teams across an organization might benefit from the adoption of these methods.

OKRs naturally complement agile methodologies such as Scrum, Kanban and Scaled Agile Framework (SAFe) by helping organizations prioritize work, manage resources and measure outcomes. By integrating OKRs with agile processes, teams can:

• Set clear objectives for each sprint or iteration.
• Define key results that measure progress and success.
• Align team goals with broader organizational objectives, both long-term and short-term.

To achieve a successful agile transformation, organizations often establish company-wide OKRs that align with their transformation objectives. An example of a company-wide OKR for an agile transformation campaign might be:

Objective: Successfully implement agile methodologies across the organization.

• Key result 1: Train 90% of employees in agile principles and practices by Q2.
• Key result 2: Increase project delivery speed by 30% by Q3.
• Key result 3: Achieve a 25% reduction in time-to-market for new products by Q4.

This example shows how company-wide OKRs might align departments and teams with the organization’s transformation goals.

In addition to company-wide OKRs, organizations might establish department-specific OKRs to support agile and digital transformation efforts. For example:

• IT: Implement a continuous delivery pipeline, reducing deployment times by 40%.
  
  
• Product: Launch three new digital products, each achieving a 20% customer adoption rate.
  
  
• Marketing: Increase online lead generation by 50% through targeted digital marketing campaigns.

When implementing OKRs into the agile transformation process, many organizations take these steps:

Involving key stakeholders and staff in the development of OKRs can help promote alignment and buy-in. Key stakeholders can include executives and leadership teams, product managers, team leaders and other team members. Key responsibility (KR) owners, scrum masters and agile support staff might also be identified at this stage.

Some organizations find that establishing an agile project management office (PMO) helps implement OKRs in an agile environment. An agile PMO can facilitate the development of agile frameworks that align with the OKRs. It can also help teams track progress through iterative and incremental methods.

In defining objectives and key results, organizations often aim for ambitious but doable goals that follow the SMART framework: specific, measurable, achievable, relevant and time-bound. Key results are typically tied directly to the objectives.

Along with defining OKRs, organizations might identify key performance indicators (KPIs) to help measure performance against the OKRs.

OKRs should be set for a defined period—such as yearly or quarterly—and should have clear milestones and deadlines. Establishing a cadence for regular OKR reviews and updates can help organizations stay on track.

Staff might need training and support to help understand how agile teams work and their roles in both agile techniques and the OKR methodology. A key aspect of agile methodology is that it is largely collaborative and less top-down than the management of many traditional organizations.

Tracking and measuring OKR metrics and KPIs can help the organization understand if it is really making progress or if a change of course is needed. 

Regular check-ins, such as monthly retrospectives—at the team level, company level or both—can help make sure that the entire company is on track for OKR success.

OKR reviews provide an opportunity to discuss progress and challenges and review suggestions still in the backlog.

If new actions are needed, the check-ins might provide a goal-setting framework encouraging suggestions for future iterations and an opportunity to brainstorm potential solutions.

Organizations can use data-driven insights to inform their decision-making and refine OKRs to further speed their transformation to agile practices and greater success.