Teaching OKRs to Executives w/ Andrew Young

I have found teaching OKRs to an executive is not about teaching OKRs. It's about helping the executive understand their role in the system. Helping the executive understand that their force multiplier is to create a trusted system that works. Hey, this is Dave Prior. Welcome to leading Agile's Sound Notes. Andrew Young is here today. Andrew, thanks for taking time out of your Friday afternoon. Of course Dave, excited to be here and chat about something that has been exploring a lot on. Yeah, so we're going to talk about teaching OKRs to executives, which I'm going to let Andrew tell you a little bit more about the topic and how it relates to some other stuff we've been talking about. But before we do that, Andrew, can you share with the folks that are listening, the work that you do at leading Agile? I know there's like a specific focus to it. So maybe kind of how you ended up pursuing that area that you're so kind of locked into. Yeah Dave. So I'm here at leading Agile. We have a couple different flavors of coaching and historically we've been around the system of delivery. How do you create stability and increase your throughput and focus on advancing what we might refer to as like the machine or the factory. And one of the things that the industry has seen is that there's a layer of once the factory is going what's coming into the factory and out of the factory has to be improved as well. And so leading Agile, we have this subcluster of people called the product practice where we're focused on how do we advance what's coming in and going out of the machine. And you know that's kind of where I spent my time in one of the topics around today's conversation is around how do we decide value? How do we define value? In value historically might have been measured on dollar amount or a cost savings amount or the number of new logos that you can do. And there's this kind of amorphic definition of value that we're really looking at. How do we clarify that with our executives all the way down to the team so that we can help make better prioritization decisions? I come from a little bit of like a design background. I didn't write code but I came from this like systems thinking problem solving lens. It's what can be optimized to increase value. So before we get into the topic I want to ask you a question about that because when I'm teaching the PO classes a lot of people ask me like you know how do I get better at this job? How do I become you know like an engine-ish person in this job? And it seems like everybody I know at least everybody at leading Agile that's really heavy into this stuff maybe with the exception of Scott like straight out of design background. Is that normal? I mean it's like that what you find across the board or is that just a leading Agile? Well so I mean you're you got a selection bias you're starting with and you know I I have a premise and a belief and an assumption and a hope and a desire that yeah designers are going to run our businesses of tomorrow. We're going to we're going to leverage this the skill set that's being taught in design school or and you know I substitute design school and product management right now because we don't have product management school but we see a high correlation between designers and product managers and it's the ability to assess the system not the solution and designers you know they're forced through critique all the time it's not good enough are you solving for the customer are you building a thing that's going to resonate with somebody who's not you most designers don't design for themselves and I think that's the really fascinating part of this is designers from day one are taught you're not your consumer and that lens is really important in this progression of value it's what's going to be valuable for the people paying us money or signing up for our service it's about solving the right problems for the right people and odds are you're not one of them and I think that's that like nugget there that that designers intrinsically come to the business with. So in that and I just want to check in with you on this it seems to me like if you are design minded right it doesn't matter whether what kind of designer working on it could be websites motorcycles you could be just studying Edward Tufty stuff like anything where you're trying to make sure that you understand who the person is what they actually need and how to give them what they need is opposed to just deciding and executing. Yeah and that's a great reference the Tufty reference you know we can throw a fuller in there as well design is just problem solving right so I historically taught it Georgia tech a little bit some design thinking courses and I used this boilerplate definition is the design is just solving problems within constraints and the more constraints you have the harder it is to solve the problem but the more creative you have to be and so is it organizational design is it website design is it graphic design am I focused on a poster am I focused on a process am I focused on organization it's all rooting out the same stuff you know I highly correlate six sigma mindset into this space I think about influence in this space you know our trust influence with the leading agile is just a application of design what problem do we need to solve and how do we do it well we create the opportunity we then show that we can do it we then gain some influence and and have a point of view right we just go through that loop over and over and over again it's just a design problem and so it to your point and I think you cleanly identify all of the stuff we're going to talk about today roots back to stuff that was happening in the 50s it roots back to the way Disney thought about how he was going to create the Disney theme parks it thinks about forward and how people claim they just wanted a faster horse but what they really wanted was a way to get somewhat faster so if you have somebody about the solution they're going to tell you what they think they want and we're not actually going to emerge the advancement and so you can kind of like throw in the word innovation which I'm not the biggest fan of but the progressive elaboration we talk about is all just rooted in what are my constraints and what's the problem and who's going to pay for it okay and I want to mention one thing about the constraints too because it sounds like this is very much like that chaco will and it's like good thing like whatever whatever box they put you in good because I get a lot of people in class you talk about how they can't do this they can't do that and I always want to be good good do it anyway figure out way that's your whole job whether you're designing a product or a way to make actual work in your organization right that's exactly right I think that the box or the size of box you can play with influences the other boxes you will eventually get to play with and so you're right maybe you can't reinvent the whole organization but you have a set of constraints you can play with them to build the best version within the constraints and then over time you gain agency you gain traction you gain influence to change the box you're playing with and you know if you look at my career that's what it was I started off designing posters and kids toys and kids books but it was the same process it was the same mindset it was the same procedural advancements that I would go through to make sure that the customer was getting what they needed and it wasn't for me and then that moved into web experiences and to end experiences customer journeys we started thinking about how do you start from the first touchpoint of a customer to the last touchpoint of a customer you might need a poster and a customer service interaction and a way for them to interact with you and a follow-up chain but we're still just designing an experience and then what do you need once you get over the experience you need an organization to offer that and then once you have the organizational solution or the business model you need to then build a system that people can live with them and you know that's what we're playing with this transformation stuff is it's not just about the systems and practices to deliver the output it's about making sure that you have employees that stay with you that you retain the knowledge management systems that you retain you know the intellectual property because if that's an attrition point as well you're constantly having to reinvent the process of people and you're not even focused on the outputs anymore so it's all the same domain space it's just the different execution and actualization you're focused on this is this podcast is already great man there's nowhere to go but down from here well I was going to say and we might just go and change the focus of podcast it's got you know okay I've got notes we're going to do more I've got a whole bunch of notes now stuff I want to ask you but but let's go back to the main topic to the main topic we're going to focus on was how to teach O.K.R.'s to executives and before we go down that path I'm hoping that maybe you can clarify what O.K.R.'s are because I hear people talk about them and I hear them talk about KPI's and I know that some people mix the two things up and the old school project manager in me when I hear them thinks about balanced scorecard so what is an O.K.R. yeah so by definition O.K.R. are three letters that are clustered into two words it's an objective and a key result what they are synonymous with is you know some of the things or possibly synonymous with or poorly substituted for is maybe the way I would say it is a goal is a KPI is a balanced scorecard is performance management it's a way to measure it's the leading and leading indicators it's the outcomes it's the manifestations you know I hear all of those different things but when I pause and really think about O.K.R. it's two units of a framework where we give something aspirational an objective a place we want to go a direction we're heading something we want to actualize and then some key results how are we going to measure we're getting there how are we going to make sure we have a checks and balances system in place to get us there when we think about maybe how some people have referenced O.K.R.s before there's a couple different lenses or maybe a maturity model of ways people have implemented O.K.Rs when I think about the ways that I've started O.K.Rs and some of my early references I think back to it's a way to say no and it's a way to empower us to stay focused and so I love this phrase that if you don't have a priority but you have many priorities you actually don't have a priority so if everything's the number one priority you actually don't have a number one priority that's what this objective and key result system is focused on is what's the most important thing to keep our and at whatever level of the organization we're focused on focused so as an organization what's our primary objective what are we investing into where do we need to go how do we need to get there and then maybe there's a network of O.K.R.s in the organization that say okay to help us actualize that big objective that's going to take a whole bunch of COGS and nuggets and pieces to come together what do we need to focus on be it a functional team be it a product line be it an individual person there's hundreds of ways to implement this but it's you know what's the one thing I'm focused on right now and it allows me to look at my day or my week or my team and say I'm all the work we're working on is any of this actually helping us progress towards that objective and are we keeping score appropriately with these key results do we have any impact of the outputs we've created over the past day week month have we made progressions on those two results if not are we focused on the wrong stuff and how do we then get focused on the right stuff okay I have a whole bunch of questions I want to ask you about this stuff right now but before I start riddling you with questions can you comment on the evolution of this because this is not like a brand new thing it's not it it's not something that emerged from leading at leading agile it's something that's been around for a bit and we've kind of applied it maybe in a different way or put it together in a different formula but this approach has been proven out in a number of different locations yeah yeah there's this common cycle of frameworks and management practices that kind of add and flow in and out I think about a sign wave of you know the popular and then a group of people say well that's not the popular one it's going to be this and then we introduce something new and we then introduce something new and what we've seen with the OKR reference and the legacy and Genesis of OKRs is you know most people in today's world are you know getting some anchoring around the Google version of them the Google story John Doer has the book a measure of what matters it's kind of glorified or helped people understand how we can leverage these things but he didn't invent it either before that we had Andy Grove who took this kind of management based approach management by objectives model intel in the 70s you know that was a reference back to what OKRs emerged from but it was called management by objective and you know Andy wasn't either the Genesis of this either it kind of reference all the way back to Drucker in the 50s he started thinking about this goal setting by strategy called management by objectives as well so you see this evolution of thinking in the 50s Drucker goal setting he's the term goal and setting and how are we going to actualize that we're going to manage to objectives in the 70s Andy Grove reintroduced some of the concepts and he took management by objectives into intel and really actualize that through some of the OKR model and then it inspired Doer who is at intel to really take it further and then in the 90s Doer wrote the book and explicitly called out the O and the KR methodology the Google leverage and now we're seeing this new Genesis of OK how do you take what Google or what the Valley did and these startups that came hyper focused on the thing that they had to do to stay surviving as an organization today tomorrow this month next month and how do you exploit that into the enterprise and so we're seeing this new Genesis of OKR scale in the enterprise and and a lot of the organizations that have you know they've come out of the startup space or moved over into Agile this is another tool they use to sharpen their approach yeah I think so I think there's a high correlation to to the startups leverage the Agile mindset or the Agile frameworks and they've kind of exploited it we're seeing the attraction of startup employees to help scale enterprises this is just one of the things they're bringing out their toolbox or their tool bag or their their tool belt and kit to say this is how we found success and execution OK now you mentioned scaling is this something that is being more focused on by organizations that are trying to come up with ways to be efficient at scale or is it equally applied across all sizes of organizations so I think it's equally applied across all organizations right it's a tool to help you focus okay I think we're seeing some new literature and some further thinking in today's world about the failures of trying to scale the OKR model you know we're trying to really stay away from some of the maturity where it's not a hierarchy but a network we're trying to decouple things how do you create containers of encapsulation right a term we use all the time if I have an encapsulated thing well what do I point them at do I point them at a business objective do I point them at a strategy do I point them at execution well let's give them a purpose and you know you know another whole set of terms that we haven't even correlated to OKRs nor star my purpose my guiding light where I'm running towards all of these different lenses it just is a quantifiable way to do that and we're just now seeing a lot of exploration as to why they might be failing in their price and I think leading agile you know we come from it in terms of you're still going to have that system of delivery you're still going to have that execution arm that can really focus on actualizing the stuff but we've got to help them shape where they're going and this is just a natural evolution for us is to helping point the aligning the north stars OK so I want to try to simplify it for a second and then ask a bunch more questions and then talk about how it ties back to the L.A. approach is that OK curve absolutely just in sort of a path because there's there's I want to keep myself from getting too lost in the meats so when you were explaining how this works earlier I was thinking okay so this is basically like a bunch of executives sitting around saying this is the one thing we have to do we're all going to agree to do the one thing and everyone says yes the one thing and they leave the retreat center and go back to the little fiefdoms and like I screwed the one thing I got to get my thing done the north star whatever you want to call it that's the one thing like this is the most important thing right now you could say that the most important thing is to come up with a vaccine for COVID with that does that work well um so I fumble on my words for a second I think about one of the first things I do and when we think about coaching this is context is important okay and what I say is right for organization a in terms of what a good objective or key result or OKR framework looks like might be completely wrong for context B so okay so knowing that like people love a framework people love give me the plug and play the madlibs and I would love to say OKRs are maturing to a place where we have some plug and play stuff but it's not a madlibs and so it's first off what's our context what's our importance um why were we at that retreat what who are we and so there's a couple common examples that I use that aren't even related to the software that might be relevant here and so I say you know what if I'm a coffee shop owner uh local little coffee shop independent guy have you know my building on the corner and I I have a intrinsic driver that I only ever want to sell coffee and you know we're a coffee shop we're going to be the premium coffee shop okay that's our mission and what is our objective right now it's what do we need to do to stay in business or grow or go to where we're going and so if our current conditions say you know what we're not creating enough revenue to remain to even break profitability our objective is to find profitability that's the top you know objective right here is everybody we got to figure out anything we can do to achieve profitability at the same time what we're doing is creating the curbs of decisions and autonomy for the rest of the organization so if I have attention here and this belief is an owner that says I'm only ever going to be a coffee shop don't do anything besides coffee also achieve profitability and so I has in the organization I've created the tension that says don't go do something that's not coffee but find profitability so if it's around coffee make fine profitability so that might say a group of people in the organization say we have a good way to find profitability let's sell coffee merchandise as opposed to just coffee or let's sell coffee t-shirts or let's sell coffee books or let's sell coffee beans or let's sell coffee classes it's all around the domain of coffee but if somebody were to come in and say you know what we have and this is a real common thing that happens in our software systems I have a whole bunch of customers that come through our door and they say you know what we'd also really love tea but if if I just say go ahead and go do the tea I have this tension I'm breaking I'm achieving possibly the profitability but I broke my mission and so as we're in this tension the value of the OCR is to give enough context so that people can make independent and absolutely the decisions in service of where we need to go so maybe that objective maybe the more mature version of that objective is to find profitability with enhancing the coffee business but nothing but coffee because if I don't create those conditions it's going to empower the people because that's what we're hoping for here is empowerment go figure out the best thing you're the closest to the customer you know our domain the best I executive know where I need us to go but I might not talk to all the customers and I'm maybe one two three four orders away from a customer let's empower the people that are at the customer to influence where we need to go okay I worked at the first Starbucks in New York City when it opened and when it opened all we sold was coffee nothing else I think coffee and tea and lots of beans you could buy every kind of bean we had bins full of beans but no food was served and that was like a thing they were super snotty about like Starbucks is about educating people about coffee food and refuse with the taste we're not going to have that and then a couple weeks in they brought in bagels because they said New Yorkers couldn't handle coffee without bagels and then it was bagels and muffins and bagels and other kinds of pastries and then it was candy bars and now like you can go to Starbucks and not have any coffee at all just get like a salad and a milkshake um if the mission of the company was to deliver good coffee and teach people about coffee and they realized that it didn't work in that particular environment and that continues to spread does that mean that they're losing sight of their mission or is the mission changing or is that the context you're talking about well it's the context and then it's a great example to think about something Dennis our methodologist really talks about it in the the trusted system and we're we go from markets to customers to one of their problems what are our targeted solutions and how do we design them and then implement them and there's this evolution and as we learn and one of the things we're trying to do with uh not just OK ours but you know everything we're doing with our transformation work is make smaller bets and learn and so some of our key results are just about learning cycles and if one of our objectives in that first Starbucks example was to be focused on the coffee and the only way you can sell coffee is with a bagel in the context well we have to now make a decision are we going to evolve our objective to say something around creating an environment around coffee or do we now need to change our objective to say New York was the wrong place even though it's a high density population it's not aligned as the customers we want and so one of the things OK ours are going to help us with this fine clarity into who and the who there is markets and customers do we need to be closely tied to and so there's always this tension of feedback loops and learnings from assumptions and how we can evolve them and so unlike goal setting frameworks OK ours are dynamic or have the potential to be dynamic so we could end up having the conversation of do we want our mission to be to educate people about coffee to just sell coffee to provide people with an enjoyable experience or take over the world and be you know on as many corners in New York as we are in Seattle that's yeah yeah it's interesting I'm I'm going back through watching on our lockdown here I'm watching Silicon Valley again and I just re-hit the episodes where they're talking about Pied Piper and the focus of like what is the product and the claim is it's it's whatever the stock market needed to be or shareholders wanted to be so that we can be profitable and that's very mean startup though right yeah and and so if that's our focus right in our mission and our top objective let's just be explicit about it if our driver here is to make as much money as we can and whatever means possible we might have competing and or divergent markets customers and products okay that's reasonable but I have to know that from the beginning and where we then choose to invest our money and where we place our beds is we just the similar way we have a backlog of features and stories and epics at some point we're going to end up with a stack rank prioritization list of objectives and that group of executives we talked about that came out of the retreat they're going to have to come out with the one or two and so the process of executing what objective we pick because we're going to have hundreds of objectives everybody in their brother has an opinion about what the right objective is right and so there's the difference of what is the purpose of the framework enabling the organization to achieve and actualize and then how we execute the framework and how we populate the content in the framework right and so there's you know we're getting into like the nuances of execution because there's also two different or layers of maturity with the okay or are they top down or bottom up are they middle out right all of those versions are appropriate based off the conditions we've established so we can do a top-down deployment which you know isn't maybe as mature the model of sentin responding all the feedbacks from the products and the teams of where we need them to go to achieve our bigger objective okay so if our objective was to send a man to the moon and return him safely within 10 years how would we measure the key results along the way like how do you get from that big wish to we're making the appropriate progress towards that and is that is that a fair example well so it's not okay come up with another one it's an okay example I'm going to bring it down to a personal level and know that this could scale into an enterprise but what you introduce there in the big notion of duration of 10 years and a man on the moon is something that's big and grandiose okay so to do that do I want to just wait and we're going to introduce the concept of leading the leading indicators here now do I just want to wait 10 years to see if we did it no I want to measure progress for right so I think about a similar example of somebody tells me they want to lose 20 pounds my objective is to lose 20 pounds okay okay interesting but why and so if you've ever interacted with some of these designers or some of these product people who are like the five year old little kid tugging on your shirt but why but why but why that's what we're looking for here with some of this okay artwork is but why do you want to lose 20 pounds because what that really sounds like to me is an outcome and there's a difference in our maturity model of okay hours between objective and outcome okay the outcome and I think about football teams there's a lot of examples around the sports ball teams metaphors with okay hours but winning the super bowl kind of is an outcome but the number of touchdowns you score the number of points you score rate those are lagging indicators of success so this 20 pound thing my first question is why do you want to lose 20 pounds and maybe it's a mother and she says well it's so that I can run in the park right well why do you want to run in the park well because I enjoy spending time with my daughter well what does that really mean to you well I want a healthier lifestyle so I can enjoy my child's upbringing and an outdoor fashion okay there's an aspirational objective that sounds like an objective find a way to spend time with my kid in the park outside and enjoy it and it just so happens our hypothesis outcome is that I need to lose 20 pounds to do that right but one of our big things that we've learned with our clients is there's a lack of ability to what we call trim the tail and if I'm so focused on the losing the 20 pounds and I lose sight of the objective of having fun with my kid in the park I might not ever go have fun with my kid in the park if I'm only losing 18 pounds but 18 pounds might have been the right number for me and I just didn't know it from the beginning and so in this example what are my key results of being able to do that well my really hypothesis key results might be eat a thousand less calories every day so I have a hypothesis that if I get a thousand less calories I'm going to be well on my way to losing my desired outcome of 20 pounds all in service of that objective to be able to play with my kid in the park or ride my bike with my kid I might also say okay one of the ways I think I'm going to measure this is I'm going to start going to the gym and if I at least just get to the gym three days a week so my next key result is get to the gym three days a week and then you know maybe that last one key result so we talked about eating less calories we talked about going to the gym maybe one of them is also just choosing to have a more centered outdoor lifestyle and so maybe a key result is I go on a walk every evening with my husband and so when I think about these key results I'm going to start looking at these on a short term basis I can measure those and I can look and do an assessment on a weekly basis did I hold myself accountable as a leading indicator to these things and maybe I do and maybe I do eat a thousand less calories and I had hit the gym consistently for the past month three days a week and I have gone on these walks but I'm not seeing any progress towards my desired outcome well this is the beauty of the key results is there could be dynamic maybe our hypothesis was wrong maybe it takes 1200 calories and so we're going to adjust it and we're going to take another small bet of something we're going to test and maybe it's five days of a week we need to get to the gym right and so now we can be having some sort of progressive elaboration of how we're approaching this but all the units of work we're going to do each day we have the reminder to go to the gym that's like an initiative or a task okay and so I can just start tracking the outputs and the outputs is go to the gym go to the gym go to the gym eat less calorie eat less calorie eat less calorie I can track all of those but just tracking outputs isn't sufficient I just track that I went to the gym actually not measuring my impact towards my objectives okay but so I have a couple things I want to ask with is I want to start with that last one so let's say somebody is trying to lose weight and they weigh themselves every day and they keep a record of that every day and you can see the weighing yourself every day isn't going to necessarily drive a result but there are those you know that that one approach for you supposed to put a scale in front of the refrigerator and weigh yourself before you take food out of the refrigerator and it is a subtle chip at like takes a dig at your motivation like why am I getting this food do I need this food do I need to have this is it more important to me than this thing that I want to lose weight is that is just measuring it enough sometimes enough of a reminder to keep people headed in the right direction absolutely and when we think about it it's well how did who who chose in that okay are assume we're in a big enterprise again who chose in that okay are structure those key results well it's probably not the executive it's the person closest to the customer and so if the person closest to that style of customer says for this customer segment or persona these are the leading indicators we need and for this persona it's just getting them on a daily scale that key result of did you just measure yourself every day is a leading indicator for some people that is not a leading indicator that's going to be their leading indicator because the scale isn't a motivator for them and so we're going to create those conditions of key results and this is where I you know when we started this said conditions are going to look different and what I say is good for you might be a bad example for somebody else right and you know and this is the the situation on this is is if my key result can't be if my key result only measures when I'm done it's a leading indicator and I don't know until I'm done and what I don't want to do is wait until I'm done to know if I'm done or not okay so with what you just said my example of 10 years to the moon and back is the way it's the way that people tell that story the way that I introduced that story potentially is is not a good example because if I was totally waterfall which is how I was raised I say 10 years this is going to happen and I and I need to see a plan but I don't really look at anything until 10 years is up and we have no idea if we can do that in 10 years if we're not checking along the way and iterating along the way on this is the indicator this is the thing we thought was going to move the needle didn't move the needle enough okay let's try something else the scale in front of the fridge is okay but maybe we need to add something else to that and something else to that and then we figure out how to have the biggest improvements to get us to the goal that we have as opposed to just waiting that's a reasonable presentation Dave and I think because my my product guys are so polite with my bad examples there's always a long pause and then like yeah okay well my first like desire to ask you and I'm going to connect this now to like what's unique about the executive right we had this teaching okay ours to executive in the title and so let's let's bring that in okay executive tells me we got to get this man on the moon in 10 years yeah I first want to say but why well yeah that was going to do the next question okay good yeah what do we want to do when we get the man on the moon what's the value of getting the man on the moon like so oh to play golf okay so now I'm going to say why do I want to man on the moon to play golf and as we start to decompose this the difference between teaching okay ours to a to an executive and to my product manager or my enterprise architect or my front end developer is a lot of executives have a command by directive approach go build this thing because I have either some crazy suspicion or some historical data or just some crazy desire and the value of the okay are in teaching the okay are to the to the executive is it's not about what to go do it's what can we do once we're there so once we're on the moon why did we want to go to the moon is it if it's purely just an ego play show we can put another man on the moon okay let's be explicit about that that the true objective when you tell me the whole objective is just to get the man on the moon and I have no desires post getting the man on the moon we check it we're done the outcome wasn't the man on the moon and so that's what I'm going to first ask is your outcome is really just the man on the moon it's not something greater it's not the next evolution it's not that this isn't a part of a bigger network of desires because if it is just getting the man on the moon isn't sufficient right if I I'm gonna be darker for a second but like yeah uh does the man have to be alive because you just said put a man on the moon well and so the reason this is I think a good example is you said that why questions it's not really about the moon it's about beating Russia into space and getting to the moon before Russia yeah and so if you ask why then we get into the whole thing about you know whatever patriotic stuff is going on but there's got to be some reason at the end that people don't even bother to ask most of the time correct and those little nuggets are really important because it changes the frame in which the teams will work the sequence that they work the micro validations that they need to prove to get to the big validation the I'll use the term milestone but I'm not using it in like an old project timeline sequence but what are the the validations we have to prove the milestones we have to declare to be able to do that right and so when we think about historically men on the moon if we're talking about our first man on the moon we first had to like have an objective that we can launch a thing in the space like and that's our big objective right now is can we get a thing in the space and our outcome is do it without killing somebody do it without it blowing up do it within this timeframe okay so we've accomplished that and so we're making a smaller bet because what I first want to if my big objective is man on the moon but I make a smaller bet just prove to me you can get something in space and if we come back and say you know if that's not feasible that's not reasonable we have two traces to make abandon the original objective right in place of the next most important objective to invest our money in so we stop bleeding money or go find more money go find new resources go find the right conditions so we can put the man on the moon everything's possible and that's what you know fascinating and fun with executives is I don't run into an executive that doesn't have a good idea it might be dated it might take more time it might be more difficult it might take resources they don't have yet but you know what we can get there the question is is are you willing to invest into that the same way we think about a backlog I'm gonna say yes to this until we have something more valuable my objective this is just scaling up and I'm ginger on the way I think about this because I just don't want to take backlog prioritization the way that we teach it in a system of delivery and say well that's how you create okay ours because there is an intersection between the way we coach the system of delivery to deliver and what they're going to focus in the delivery on there's at some point an overlap between how you prioritize your backlog or how you run your impact map or how you run your prioritization processes connected to objectives and these objectives now become part of that weighted matrix if I use your term balance scorecard I think about like how do I choose what what goes into it it's what what's going to help me actualize my backlog has to help me actualize creating the business objective okay and and so I you through the term business objective in now because I'm thinking about a large enterprise yeah I have business objectives at the top strategic objectives we're going to have some functional objectives kind of in that network and then a product might have an objective maybe the objective for this product is just business as usual okay maybe for that product it's become the new competitive advantage for the organization wow okay and so now we're going to have this network of objectives that all have to piece together then when we zoom out on our monthly review our quarterly review or annual review say if we go do all of this network of stuff that our organization is telling us that we can do all of these objectives will we get to where we want to go and if we say yes we're going to let the system go if we say no is it because we have the wrong people do we have the wrong allocation makeup or do we have just an impractical objective at this point right okay so I want to ask you a question about this and see if I can thread this back to transformation and the leading agile approach and then I want to come back to executives and what makes it unique to teach it to them see if this if this works if I can get to a why then not only do I have a better understanding of how to make adjustments to get me closer to where I say I want to go but it's also going to be easier for me to make choices about what I'm willing to sacrifice and give up and the parallel that I see with transformation would be an organization says I want to be agile and if they can't answer why it's going to be really hard for them to make hard choices about okay what are they willing to give up to get that encapsulation to get cross-functional teams to get work broken down into these you know smaller pieces and to get it all decoupled and all that stuff if they don't know why they're chasing the thing what is the outcome they're looking for and they can't decide what they're willing to do to get there correct it goes into the whole transformation concept of understanding your trade-offs and that's exactly you know you couldn't I couldn't have said it any better Dave that was a beautiful explanation of hoping someone understand the trade-offs you have to make at any given point to achieve what you want to achieve okay so if you have this conversation with thank you for saying that so I always get nervous when I talk to you guys because I feel like I'm like the slow one when you're talking with executives about this stuff and they want the thing but they don't know why they want the thing how does the fact that they're in this leadership role like how do you get to the point with okay ours where they're seeing where they really need to be focusing their decision-making and where they're seeing the questions they need to be answering and what they're seeing what kind of stuff that they're going to have to measure it goes into teaching okay ours and this is where the difference between teaching okay ours to an executive and to the team members yeah really splits I have found teaching okay ours to an executive is not about teaching okay ours it's about helping the executive understand their role in the system helping the executive understand that their their force multiplier is to create a trusted system that works to focus on improving the system and giving a direction for the system and letting the system figure out how to optimize towards that you know one of the things that we find over and over and over again with executives is they found success by having answers right and what we hope them do as an executive in terms of this bigger transformation that we're going through because we're probably not just going in and just saying yeah you guys need some okay ours and you'll be better with okay ours it's a it's about that whole practices and systems we're instilling during the transformation that we're also going in and saying you know what it's really important to connect people with purpose it's all about a ripple effect the more people that have purpose the more inspiration you have the closer they are to customer the more conversation they have it's not just a cog in a machine trying to deliver an output but we're all inventing we're all brainstorming we're all thinking about the outcomes and when an executive just says go build the green paper airplane machine as opposed to we need to figure out how to win in the airplane paper machine paper airplane markets the best possible we take that ownership away from teams we take that ownership away from the system and when we do that we take away the ability to be creative to put the constraints in we've actually put too many constraints in and so we talked earlier about like this idea of like constraints or a good thing until you're over constraint and if I don't feel empowered to have the right conversations to provide feedback we're running off of assumptions that are so far disconnected from the customer or the problem or the market or the segment that we're trying to address that we're running on assumptions and so with executives we're really focused on this okay our thing is about empowering the organization it's about learning and creating a learning system that you're focused on building the system not playing in the system it's your role as an executive to create the conditions for all of these you know you we assume you hired good strong talented people that were able to do the job but yet we're not letting them always do the job that we hired them to do we asked a product manager to manage a product to decide where it goes what functions what features we ask product owners to go talk to customers what will this solution work does this solve your problem we ask engineers to say what's the best way to architect this thing for scale and for scalability of time and space and um load of people on our systems and if we take all that away and say go build the green thing that can do a thousand paper airplanes every day all we're asking people to do is just be an executing arm and at some point that the knowledge transfer gets lost and that knowledge gap gets so big that executives are only running on assumptions that are not connected to reality yeah I did an interview with Marty Bradley not that long ago where he tells the story about like guy that he worked with and he told the guy like build the green paper airplane and because that's what Marty had decided the solution was and the guy came back and asked Marty a bunch of questions and Marty's solution was going to take like months and months and months and months and this guy figured out a different way to solve the problem that didn't involve building the paper airplane and it took like two days yeah it's crazy because the thing we coach with these executives is technology is moving faster than you can keep up with yeah let the people that are close to the technology and I use the term technology there is also encompassing progressive elaboration of how we think and how we execute but let those people because they know more than you know and your one mind locked in a room is not as good as the thousands of minds you have on the front mind despite what their ego tells them so despite what their ego and their their tie and their suit and their beautifully watch yeah their mahogany wooded wall boardroom like all of those things are great and we need these leaders because here's the other thing if you flip it around and you give a team all empowerment to make all decisions they're not going to be aligned and so there's different tiers right you think back to our transformation model we have the four tiers or five tiers or three tiers based off the organization there's a different level of responsibility at each of those tiers yeah so people are focused on solutions some people are focused on direction I don't have the capacity first most and I probably don't have the capability to do all of it really good it's that like Jack of all trades master of none well let's create masters of things and as an executive with the okay are your mastering skill here is can you set clarity that helps you achieve the assumptions you want to achieve with the least amount of investment as possible so you can then keep having a desire an exponential growth so I imagine that when you're teaching this to executives a big part of this also is going to involve creating a space where they feel safe enough to unclench and let go of the wheel and to trust that the people that are down there in the weeds of doing the thing every day who actually understand all the tech behind it that don't make sound decisions and all that's going to be predicated on this executive being super clear about where are we trying to get to and why yeah it's the trust thing is really important the other thing is these executives and I say that like a negative like those executives those people yeah those people the people right and that's the the nugget here is like everybody wants purpose and connection and value and what they're protecting is the organization and we have to remember at the end of the day they're not hopefully they're not out just for self-fulfilling interest right they're here creating the conditions and what they have to be able to do is the executive is looking at a longer scale than most of our teams they're also saying how do I trust anything coming from the system not just the request and the desire and when the output is but how do I know that it's directionally aligned with where we're going and so how do I sense and respond we talk a lot about this sensing and responding and the coaching models of coaching executives and OKRs is you have to figure out how to have a healthy relationship of smaller bets for better information for smaller bets for better information and that we're creating that trusted system that I can delegate into and that it's up to the executive to establish that trusted system so the OKRs is just one little piece of helping establish the trusted system the bigger coaching here and the coaching of OKRs to executives is how do you really create a trusted system have you created the conditions of a system you can trust because nobody else is going to create that system but you executives and that's not that's one of the things you can't just leave up to the team right it's it's almost irresponsible to leave up to the team if you leave it up to the team they're going to go locally optimized against what their interpretations are and so we're trying to remove levels of interpretation at the same time of creating clarity it's directionally aligned yeah so we've been talking about this for a little while now and there's two things that I want to kind of come back to before we close it out one is about the leading agile approach with OKRs because I mean anybody could go out and pick up you know one of the books that did talk about it but we're using this in a slightly different way so can you comment on that like what about leading agile approach with OKRs makes it unique yeah there's two primary things we're doing and I think back to a reference I had of a maturity model everything we've talked about all the books they're beautiful the great they're going to be useful don't abandon it go use them they're better than nothing and they're better than just setting a goal I think the secret sauce we're bringing is the first secret sauce is how we connect it with our system of delivery so we think about these objectives and you have executives this it maybe above this system of delivery or next to the system of delivery and they're shaping that lens for the business and what we're really focused on is how do we decompose those strategic and functional objectives and key results that we're going to measure on a quarterly basis into the prioritization of the backlogs that the teams are working towards so we're really taking that impact map we're taking those proto personas we're taking all of those assumptions and saying how do we actualize the key results through the system of delivery and we also fully understand that the OKR is not exclusive to the system of delivery and so what we're really focused on coaching is hey system of delivery how can you build your impact map how can you build your influence how can you build your assumption basis to be as little as possible based off of the right learnings as quickly as possible to actualize in that and so in some of our clients we're instantiating what we're calling the investment tier focused on what opportunities we're going to invest in and in some clients we're just instantiating up to what we call the portfolio tier in both of those models what we're focused on is saying we have these objectives how are we going to allocate our funds now to solving this problem and if you structured organization around products or if you structured your organization around capability themes or if you've structured them around skill-based teams you're still making the choice of we think that these skill-based teams get 33% of the investment to help us solve this and these capability teams get 50% and you go through that allocation but what we're really focused on is not holding these out to five year three year even one year cycles or measuring and reallocating on a rolling basis with our clients to say do you still want to invest in this objective or is there something else that's more important because we've learned something about this objective or we learned something about the objective that's now more important that's to invest into and not thinking about that as throwaway work or sunk cost we're really getting into the habit of coaching towards the objective of do you want to invest in the objective ahead regardless of how much you have invested into it historically is it still worth the money or percentage of the pool of money so that's kind of like that first thing we're really focused on is don't worry about the sunk cost don't try to do everything all at once don't try to do peanut butter spreading how much money do we want on what percentage of the pie do we want to invest in solving this objective and if we don't solve this objective do we have the assumption we won't be here tomorrow or next year because of competitors going to eat us up and that first part is not an easy thing for people to let go of sunk cost or to get away from that peanut butter spreading thing because that's the way that they've done things for forever and they have an emotional connection to that way of behaving we have and we've we've gotten here that way right that's the the funny thing behind all this is there's a book out there that I absolutely love and you know I'm going to misquote it and do all the things but well God is here God is here it won't get us there and that's kind of this advanced coaching we're coming in with executives and okay ours entrusted system is you're right well got you here has gotten you here but we're going to help you get to where you need to go and we're going to have to unlearn one of my favorite terms we're going to have to unlearn some of the stuff we have learned to actually learn what's going to be the most effective way to get a store we want to go tomorrow I think you got the quote right I just looked it up what got you here won't get you there yeah the quote is what got you here won't get you there that's the name of the book too by Marshall Goldsmith it's such a good concept it's been a while since I've read the book and unfortunately I'm a reader of way too many books to pull it out and be like oh it's such a valuable book but conceptually a phrase we use a lot with the executives or thinking about this okay ours you're right you didn't use them before but we're going to help you understand how these could possibly be a better maturity model for you leads into the second thing we're doing differently with the okay ours and there's a lot of if you're in the know of who's writing about these things there's a lot of conversation going on right now of what's broken with the okay our model at scale okay and one thing that we're really leaning into if you look at our literature and our coaching is we introduce the term outcomes and so we have objectives and key results and then when every time we write an objective and a key result we say if you actualize this objective what are the desired outcomes because as we've learned to coach this most of our executives they want outcomes and they want 10 percent revenue growth they want 200 new logos they want a 20 million dollars for the cost savings that's what they want and so they're out searching for the outcomes and so as we coach this we put the outcomes over here in the bucket on the side that said that's what we're running towards but our objective why do you want those things why do you think you need to save 20 million dollars why do you think you need to get 12 percent revenue growth versus 11 percent revenue growth and if we're going to actualize all that what's the actual objective because I can just go I can have all of our employees you know bring a sack lunch and we can close the cafeteria and I can find your 20 million dollars yeah or maybe we don't send a rocket to the moon we just have people go over and take apart rushes ability to try to get into space that's right it allows us to gain the system if we treat the outcome is what we're focused on and so we have to create some sort of purpose and so we're thinking about the okay our model is now what are your hypothesis outcomes and then as we track over time what are what have become our realized outcomes and those don't change the okay our framework it's an addition or a bolt-on so I'm going to introduce a term that that I'm using as a placeholder right now Dave it's not you know know that everything we're doing is also progressive elaboration we're evolving this with each one of our clients but I'm at the place we're doing okay our owe we are doing objectives and key results with outcomes okay and that's kind of the the progressive elaboration and the maturity model we're focused on you know there's a couple other people out there talking about okay ours need a purpose statement okay ours need a scaling statement okay ours need a network statement I think what we're settling on and the way we've been thinking about it is we have objectives where we need to head aspirational purposeful motivating right key results the way we're going to measure our progress that's the way we keep score and our outcomes that are broken into hypothesis when we write them and realized as we close it out cool all right now just to make sure we've answered this question the podcast interview started with the idea of explaining how you teach us to executives and you've commented on that a little bit is there anything else that people need to know about trying to help executives get their heads around these ideas anything else that you want to share any kind of parting words or advice anything we missed yeah the parting word here for me will be if this resonates with you and you find value in it or you have been using it or functionally your team has been aligned in around okay ours know that you can't just go into the executive suite and say these okay ours are really great let's use them because what we have to do is figure out how to connect the okay are to building a trusted system because for an executive team to leverage okay ours we have to have a system they can delegate into without that it's a futile attempt to go do okay ours at the executive bubble you might as well just stay at your desired outcomes or your goal setting or whatever from where you have because without that trusted system that we can empower to create additional network objectives we're going to just fall short or everybody in the system just going to get really frustrated that they're still handcuffed and we're just calling it something different all right this was a fascinating conversation man I hope the people that are listening to it got as much out of it as I did you know I hope they do as well because if anything it was another attempt and at the way we coach it's it's fascinating to me that use the title of this is coaching executives around okay ours this is the conversation we actually have with it with the executives I mean you almost could have recorded a four-hour conversation we've been doing with some of our clients and it would sound just like this we're not trying to use big words or change the content or do something different it was this conversation this is how we're coaching okay ours with them this was great man so if people want to get in touch with you to dig into this more what's the best way to reach you best way uh like most people is through my leaving agile email address so it's [email protected] all right um cool and thank you very much this is such a spectacular way to end the week I really appreciate you taking time for this no they thank you it's uh it's always fun to practice my pitch you you