Create strategic alignment with OKR?

According to There Be Giants’ 2021 OKR Annual Report, 90% of organisations name ‘alignment’ as the reason for adopting Objectives and Key Results (OKR). In my experience most people think of alignment as a way of knowing what other teams, their peers, their direct reports or what their managers are working on today, this week, next month or next quarter. While this sort of alignment is important, I want to show you another kind of alignment. Let’s call it “Strategic Alignment”.

“Building a visionary company requires 1% vision and 99% alignment.”

Jim Collins, Good to Great
Parts of this article was first published on t2informatik blog on 02.05.2022.

What is not strategic alignment?

Alignment also certainly doesn’t mean that I tell people what to do or that I just take and copy OKRs from the top level. In some organisations, Objectives and Key Results are passed down from the corporate level to departments and then to teams. Some even create OKR silos, even though the reason for introducing OKR was alignment. Only because they believe that the OKR structure must reflect their current organisational structure. Sad, but true.

Using OKR only to connect everyone’s work vertically and horizontally along the organisational chart is, to be honest, a waste of time. This kind of alignment can be helpful, but the true power of OKR is only unleashed through alignment around a shared vision, and strategic goals.

What is strategic alignment?

Alignment means that we have a common understanding of the vision and the current strategy.

  • Why are we doing what we are doing?
  • What is the future we want to create?
  • What value do we want to create for people (clients, users, customers, colleagues, society)?
  • What is the impact we want to make?
  • Where is the field we are playing on and how do we want to win?
  • Does everyone in the organisation know and understand the direction we are going?

We people want to be part of something bigger than ourselves. We want to see how our contribution shows up in the big picture. Once we are inspired by the idea of a possible future, we want to actively participate and paint parts of that future picture.

What I am saying is that alignment requires more than just adopting a framework. Rather, it is about an ongoing discussion about the value we want to create and who is involved. The idea behind OKR alignment is that people understand the purpose of their work, and can connect it to the vision and strategy. Once we are aligned around shared vision, and strategic goals, we can then think of ways of how to deliver it in a most effective and efficient way.

Henrik Kniberg – Aligned Autonomy

How do you create alignment with OKR?

Cascading OKRs

As mentioned earlier, alignment does not mean that OKR is simply cascaded down the hierarchy levels, and certainly not that Manager’s KR becomes Team’s OBJ. This kind of OKR alignment prevents autonomy, empowerment, creativity and motivation. Besides, teams have to wait until all higher levels of the hierarchy have defined their OKRs. This slows down the whole process. Consequently, any change in a KR at a top level causes overhaul of the entire plan.

https://www.comicagile.net

OKRS are NOT for Command and Control. Do not use OKRs if you want to control people’s activities. Only use OKRs if you want to direct your people toward desired outcomes and trust them enough to figure out how. OKRs ONLY work for empowered teams, otherwise they are a travesty (a travesty reminiscent how how Agile is implemented in most companies, so not that shocking. But still upsetting.)

Christina Wodtke

Aligning OKRs

Aligning OKRs means:

  • Teams have been given context about the long- and mid-term goals and strategy. 
  • They understand the strategic intent and find their own ways how to contribute to that.

I discuss with each organisation individually how to set up their “OKR Alignment” and it is different every time. After 5-6 years of OKR coaching, I have a collection of different OKR models, such as:

  • Shared OKR between different functions pursuing same goals
  • Virtual OKR Team for specific strategic themes
  • Product OKR incl. sub-product teams and enabling teams

But that is a topic for another article about OKR Architecture.

OKR Architecture

The main idea of OKR Alignment should be to allow flexible planning and create space for creativity. If the teams know the context, the vision, strategy, long and medium term goals and understand the intentions, they will find the best/most innovative and creative ways to contribute themselves. This means they can already start planning their own OKR without having to wait for anything or anyone.

Once all teams have drafted their OKRs, I recommend to facilitate a Marketplace-Like OKR Alignment Workshop, to identify dependencies, duplicates, synergies. If teams and leadership find out that they are drifting apart in different directions, this would be a clear sign for the leadership to think about how they could/should better articulate, visualise and communicate the vision, sharpen the strategic focus and the long and medium term goals.

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