Measure What Matters: How Google, Bono, and the Gates Foundation Rock the World with OKRs

by John Doerr

OKRs are a simple process that helps drive varied organizations forward. We have adapted how we use it over the years. Take it as a blueprint and make it yours, based on what you want to see happen!

Barely a year after incorporating, Google had planted its flag: to “organize the world’s information and make it universally accessible and useful.” That might have sounded grandiose, but I had confidence in Larry Page and Sergey Brin. They were self-assured, even brash, but also curious and thoughtful. They listened—and they delivered.

“A management methodology that helps to ensure that the company focuses efforts on the same important issues throughout the organization.” An OBJECTIVE, I explained, is simply WHAT is to be achieved, no more and no less. By definition, objectives are significant, concrete, action oriented, and (ideally) inspirational. When properly designed and deployed, they’re a vaccine against fuzzy thinking—and fuzzy execution. KEY RESULTS benchmark and monitor HOW we get to the objective. Effective KRs are specific and time-bound, aggressive yet realistic. Most of all, they are measurable and verifiable.

Where an objective can be long-lived, rolled over for a year or longer, key results evolve as the work progresses. Once they are all completed, the objective is necessarily achieved. (And if it isn’t, the OKR was poorly designed in the first place.)

OKRs surface your primary goals. They channel efforts and coordination. They link diverse operations, lending purpose and unity to the entire organization.

Like any management system, OKRs may be executed well or badly; the aim of this book is to help you use them well. But make no mistake. For anyone striving for high performance in the workplace, goals are very necessary things.

“hard goals” drive performance more effectively than easy goals. Second, specific hard goals “produce a higher level of output” than vaguely worded ones.

But exactly how do you build engagement? A two-year Deloitte study found that no single factor has more impact than “clearly defined goals that are written down and shared freely. . . . Goals create alignment, clarity, and job satisfaction.”

OKRs were an elastic, data-driven apparatus for a freewheeling, data-worshipping enterprise.* They promised transparency for a team that defaulted to open—open source, open systems, open web. They rewarded “good fails” and daring for two of the boldest thinkers of their time. Google, meet OKRs: a perfect fit.

While Larry and Sergey had few preconceptions about running a business, they knew that writing goals down would make them real.* They loved the notion of laying out what mattered most to them—on one or two succinct pages—and making it public to everyone at Google. They intuitively grasped how OKRs could keep an organization on course through the gales of competition or the tumult of a hockey-stick growth curve.

As Google and Intel alumni continue to migrate and spread the good word, hundreds of companies of all types and sizes are committing to structured goal setting. OKRs are Swiss Army knives, suited to any environment. We’ve seen their broadest adoption in tech, where agility and teamwork are absolute imperatives.

Structured goals give backers a yardstick for success: We’re going to build this product, and we’ve proven the market by talking to twenty-five customers, and here’s how much they’re willing to pay. At medium-size, rapidly scaling organizations, OKRs are a shared language for execution. They clarify expectations: What do we need to get done (and fast), and who’s working on it? They keep employees aligned, vertically and horizontally.

OKRs are the scaffolding for Google’s signature home runs, including seven products with a billion or more users apiece: Search, Chrome, Android, Maps, YouTube, Google Play, and Gmail.

Many companies have a “rule of seven,” limiting managers to a maximum of seven direct reports. In some cases, Google has flipped the rule to a minimum of seven. (When Jonathan Rosenberg headed Google’s product team, he had as many as twenty.) The higher the ratio of reports, the flatter the org chart—which means less top-down oversight, greater frontline autonomy, and more fertile soil for the next breakthrough. OKRs help make all of these good things possible.

“We’ll go back in front of the company and articulate, ‘This is our high-level strategy, and here are the OKRs we have written for the year.’”* (In accordance with company tradition, the executive team will also grade Google’s OKRs from the prior year, with failures unblinkingly dissected.)

As you will see in the pages to come, objectives and key results drive clarity, accountability, and the uninhibited pursuit of greatness. Take it from Eric Schmidt, who credits OKRs with “changing the course of the company forever.”

I’ve witnessed countless individuals use objectives and key results to grow more disciplined in their thinking, clearer in communication, more purposeful in action. If this book were an OKR, I’d call its objective aspirational: to make people’s lives, your life, more fulfilling.

Grove was ahead of his time. Acute focus, open sharing, exacting measurement, a license to shoot for the moon—these are the hallmarks of modern goal science. Where OKRs take root, merit trumps seniority. Managers become coaches, mentors, and architects. Actions—and data—speak louder than words.

Superpower #1—Focus and Commit to Priorities (chapters 4, 5, and 6): High-performance organizations home in on work that’s important, and are equally clear on what doesn’t matter. OKRs impel leaders to make hard choices. They’re a precision communication tool for departments, teams, and individual contributors. By dispelling confusion, OKRs give us the focus needed to win.

Superpower #2—Align and Connect for Teamwork (chapters 7, 8, and 9): With OKR transparency, everyone’s goals—from the CEO down—are openly shared. Individuals link their objectives to the company’s game plan, identify cross-dependencies, and coordinate with other teams. By connecting each contributor to the organization’s success, top-down alignment brings meaning to work. By deepening people’s sense of ownership, bottom-up OKRs foster engagement and innovation.

Superpower #3—Track for Accountability (chapters 10 and 11): OKRs are driven by data. They are animated by periodic check-ins, objective grading, and continuous reassessment—all in a spirit of no-judgment accountability. An endangered key result triggers act...

Superpower #4—Stretch for Amazing (chapters 12, 13, and 14): OKRs motivate us to excel by doing more than we’d thought possible. By testing our limits and affording the freedom to fail,...

At Intel, he went on, “we tend to be exactly the opposite. It almost doesn’t matter what you know. It’s what you can do with whatever you know or can acquire and actually accomplish [that] tends to be valued here.” Hence the company’s slogan: “Intel delivers.”

In finding his way, Grove had followed the trail of a legendary, Vienna-born gadfly, the first great “modern” business management thinker: Peter Drucker.

Peter Drucker—professor, journalist, historian—took a wrecking ball to the Taylor-Ford model. He conceived a new management ideal, results-driven yet humanistic. A corporation, he wrote, should be a community “built on trust and respect for the workers—not just a profit machine.” Further, he urged that subordinates be consulted on company goals. Instead of traditional crisis management, he proposed a balance of long- and short-range planning, informed by data and enriched by regular conversations among colleagues.

Drucker aimed to map out “a principle of management that will give full scope to individual strength and responsibility and at the same time give common direction of vision and effort, establish team work and harmonize the goals of the individual with the common weal.” He discerned a basic truth of human nature: When people help choose a course of action, they are more likely to see it through.

Andy Grove’s quantum leap was to apply manufacturing production principles to the “soft professions,” the administrative, professional, and managerial ranks. He sought to “create an environment that values and emphasizes output” and to avoid what Drucker termed the “activity trap”: “[S]tressing output is the key to increasing productivity, while looking to increase activity can result in just the opposite.”

There’s a different school of thought that values outcomes just as much, or even higher than output, stressing the bigger picture and challenging employees to see how output impacts the company’s customers and employees above simply pushing for outputs.

Grove was a scientific manager. He read everything in the budding fields of behavioral science and cognitive psychology. While the latest theories offered “a nicer way to get people to work” than in Henry Ford’s heyday, controlled university experiments “simply would not show that one style of leadership was better than another. It was hard to escape the conclusion that no optimal management style existed.” At Intel, Andy recruited “aggressive introverts” in his own image, people who solved problems quickly, objectively, systematically, and permanently. Following his lead, they were skilled at confronting a problem without attacking the person. They set politics aside to make faster, sounder, more collective decisions.

Grove was hard on everybody, most of all himself. A proudly self-made man, he could be arrogant. He did not suffer fools, or meandering meetings, or ill-formed proposals. (He kept a set of rubber stamps on his desk, including one engraved BULLSHIT.) The best way to solve a management problem, he believed, was through “creative confrontation”—by facing people “bluntly, directly, and unapologetically.”*

Intel managers “leave our stripes outside when we go into a meeting.” Every big decision, he believed, should begin with a “free discussion stage . . . an inherently egalitarian process.” The way to get his respect was to disagree and stand your ground and, ideally, be shown to be right in the end.

The essence of a healthy OKR culture—ruthless intellectual honesty, a disregard for self-interest, deep allegiance to the team—flowed from the fiber of Andy Grove’s being. But it was Grove’s nuts-and-bolts approach, his engineer’s mentality, that made the system work. OKRs are his legacy, his most valuable and lasting management practice.

Near the end of my time at Intel, the company faced an existential threat. Led by Andy Grove, top management rebooted the company’s priorities in four weeks. OKRs allowed Intel to execute its battle plan with clarity, precision, and lightning speed. The entire workforce shifted gears to focus together on one prodigious goal.

They revamped their marketing to play to the company’s strengths. They steered their customers to see the value of long-term systems and services versus short-term ease of use. They stopped selling to programmers and started selling to CEOs.

The 8086 didn’t bring in so much revenue in and of itself, but it had a broad ripple effect. My division sold design aids—software development systems—for systems using Intel microprocessors. Though we were growing like crazy, we were still dependent on customers’ choosing Intel’s microchip for their products. Once Intel got its foot in the door with the 8086, we’d get EPROM [the programmable, read-only-memory chip invented at Intel in 1971] and peripheral and controller chip contracts as well. In total, they might be worth ten times the original sale. But if the 8086 went away, my systems business went away, too.

Microprocessors were Intel’s best hope for the future, and we had to get back on top. I can still remember the first slide of one early presentation: Crush, the purpose: To establish a sense of urgency and set in motion critical, corporate-wide decisions and action plans to address a life-threatening competitive challenge.

I thought we could win by creating a new narrative. We needed to convince our customers that the microprocessor they chose today would be their most important decision for the next decade. Sure, Motorola could come in and say, “We’ve got a cleaner instruction set.” But they couldn’t match our broad product family or system-level performance. They couldn’t compete with our superb technical support or low cost of ownership. With Intel peripherals, we’d remind people, your products get to market faster and cheaper. With Intel design aids, your engineers work more efficiently.

I’ve seen people walk out of meetings saying, “I’m going to conquer the world” . . . and three months later, nothing has happened. You get people whipped up with enthusiasm, but they don’t know what to do with it. In a crisis, you need a system that can drive transformation—quickly. That’s what the key result system did for Intel. It gave management a tool for rapid implementation. And when people reported on what they’d gotten done, we had black-and-white criteria for assessment.

What made Intel different was that it was so apolitical. Managers sacrificed their little fiefdoms for the greater good. Say the microprocessors division was putting out the futures catalog. Somebody might notice, “Oh my God, we’ve got a peripheral missing”—and that would ripple out to the peripherals division and the allocation of engineering resources. The sales force organized the seminars, but they leaned on application engineers and marketing, and on my division, too. Corporate communications wrangled articles for the trade press from all over the company. It was a total organizational effort.

Andy always wanted people to bring problems to management’s attention. A field engineer tells his general manager, “You turkeys don’t understand what’s happening in the market,” and within two weeks, the whole company is realigned, top to bottom. Everyone’s agreed: “The whistleblower is right. We’ve got to act differently.” It was terribly important that Don Buckout and Casey Powell felt they could speak their minds without retribution. Without that, there’s no Operation Crush.

“Bad companies,” Andy wrote, “are destroyed by crisis. Good companies survive them. Great companies are improved by them.”

It is our choices . . . that show what we truly are, far more than our abilities. —J. K. Rowling

Measuring what matters begins with the question: What is most important for the next three (or six, or twelve) months?

Successful organizations focus on the handful of initiatives that can make a real difference, deferring less urgent ones. Their leaders commit to those choices in word and deed. By standing firmly behind a few top-line OKRs, t...

What are our main priorities for the coming period? Where should people concentrate their efforts? An effective goal-setting system starts with disciplined thinking at the top, with leaders who invest the time and energy to choose what counts.

With a select set of OKRs, we can highlight a few things—the vital things—that must get done, as planned and on time.

For organization-level OKRs, the buck stops with senior leadership. They must personally commit to the process.

Google turned to its mission statement: Organize the world’s information and make it universally accessible and useful.

But good ideas aren’t bound by hierarchy. The most powerful and energizing OKRs often originate with frontline contributors.

Larry opted to elevate the login objective to a Google company-wide OKR, but with a caveat: The deadline would be three months, not six.

OKRs require a public commitment by leadership, in word and deed. When I hear CEOs say “All my goals are team goals,” it’s a red flag.