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Kindle Notes & Highlights
by
John Doerr
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July 20 - July 27, 2018
“The specific, challenging goals were met (speed to market, fuel efficiency, and cost) at the expense of other important features that were not specified (safety, ethical behavior, and company reputation).”
To safeguard quality while pushing for quantitative deliverables, one solution is to pair key results—to measure “both effect and counter-effect,” as Grove wrote in High Output Management. When key results focus on output, Grove noted:
But to paraphrase Voltaire: Don’t allow the perfect to be the enemy of the
As Steve Jobs understood, “Innovation means saying no to one thousand things.” In most cases, the ideal number of quarterly OKRs will range between three and five.
Or as Larry Page would say, winning organizations need to “put more wood behind fewer arrows.”
What gets lost are the human connections.
We had what every new company wanted, a hockey-stick growth chart. On
By the time John Doerr saw our goals posted above our office toilet, they were more concrete. We listed three metrics: Weekly Active Teachers (WAT), Monthly
More than two years of rejection, frustration, and more ramen dinners than I could count had finally led Nuna to a product-market fit.
One hundred percent of candidates feel they had a well-organized, professional experience even if Nuna does not extend an offer [0.5].
We don’t hire smart people to tell them what to do. We hire smart people so they can tell us what to do. —Steve Jobs
Soon it’s apparent that the individuals moving up are the ones doing what the company most values.
Organizational poisons—suspicion, sandbagging, politicking—lose their toxic power.
According to the Harvard Business Review, companies with highly aligned employees are more than twice as likely to be top performers.
Our founder, Scott Cook, believed the best idea should win, not the biggest title, and that still holds true today.
In God we trust; all others must bring data. —W. Edwards Deming
Daniel Pink, the author of Drive, agrees: “The single greatest motivator is ‘making progress in one’s work.’ The days that people make progress are the days they feel most motivated and engaged.”
Stephen Covey noted, “If the ladder is not leaning against the right wall, every step we take just gets us to the wrong place faster.”
After CEO Patty Stonesifer heard my OKR pitch at an Amazon board meeting,
We borrowed from Jim Collins: “What can you be the best at in the world?”
And the way the payout rules work, it has to spend a minimum of a billion dollars a year.
In philanthropy, I see people confusing objectives with missions all the time. A mission is directional. An objective has a set of concrete steps that you’re intentionally engaged in and actually trying to go for. It’s fine to have an ambitious objective, but how do you scale it? How do you measure it?
Conservative goal setting stymies innovation. And innovation is like oxygen: You cannot win without it.
Google divides its OKRs into two categories, committed goals and aspirational (or “stretch”) goals. It’s a distinction with a real difference.
Andy Grove was a fan of Abraham Maslow, the mid-twentieth-century psychologist best known for his “hierarchy of needs.” According to Maslow, only after we satisfy more basic concerns—starting with food and shelter, then safety, then “love” and “belongingness”—can we move to higher-level motivations. At the top of Maslow’s pyramid stands the need for “self-actualization”:
The Gospel of 10x If Andy Grove is the patron saint of aspirational OKRs, Larry Page is their latter-day high priest.
The way Page sees it, a ten percent improvement means that you’re doing the same thing as everybody else. You probably won’t fail spectacularly, but you are guaranteed not to succeed wildly.
That’s why Page expects Googlers to create products and services that are ten times better than the competition.
You know, in our business we have to set ourselves uncomfortably tough objectives, and then we have to meet them. And then after ten milliseconds of celebration we have to set ourselves another [set of] highly difficult-to-reach objectives and we have to meet them. And the reward of having met one of these challenging goals is that you get to play again.
The career of Sundar Pichai is a stretch goal personified. In October 2015, at age forty-three, Sundar became Google’s third CEO. Today he presides over an organization with more than sixty thousand employees and $80 billion in revenues.
I tried to be thoughtful and systematic and not too emotional, and I think that helped.
I wanted to emulate that quality in our browser—to the point where you could be a kid in India or a professor at Stanford, and it wouldn’t matter.
None of this happened by accident, or by the grace of a single insight. It took years of rigorous execution, meticulous attention to detail, and the structure and discipline of OKRs. And one more thing: Before YouTube could begin to chase its monumentally audacious objective, first it had to figure out how to measure what mattered.
Annual performance reviews are costly, exhausting, and mostly futile. On average, they swallow 7.5 hours of manager time for each direct report. Yet only 12 percent of HR leaders deem the process “highly effective” in driving business value. Only 6 percent think it’s worth the time it takes. Distorted recency bias, burdened by stack rankings and bell curves, these end-of-year evaluations can’t possibly be fair or well measured.
A manager’s “first role,” Drucker said, “is the personal one. It’s the relationship with people, the development of mutual confidence . . . the creation of a community.”
That transformational system, the contemporary alternative to annual reviews, is continuous performance management. It is implemented with an instrument called CFRs, for:
Peter Drucker was one of the first to stress the value of regular one-on-one meetings between managers and their direct reports. Andy Grove estimated that ninety minutes of a manager’s time “can enhance the quality of your subordinate’s work for two weeks.”
Sheryl Sandberg notes: “Feedback is an opinion, grounded in observations and experiences, which allows us to know what impression we make on others.”
If we can rate our Uber drivers (and vice versa), and even rate the raters on Yelp, why can’t a workplace support two-way feedback between managers and employees?
What do you need from me to be successful? And now let me tell you what I need from you.
Tie recognition to company goals and strategies. Customer service, innovation, teamwork, cost cutting—any organizational priority can be supported by a timely shout-out.
But neither JIRA nor LiquidPlanner could answer one big question: What’s the most important thing to do?
Old-school business models suggest that your role as an executive gets more abstract as you rise in the ranks. Your middle managers buffer you from the operational day-to-day, freeing you to focus on the big picture. Maybe that worked in a slower-paced era.
Your people may not like you very much through the adoption curve, which can take up to a year. But it’s worth it.
What you should do is more counterintuitive: Stop for a moment and shut out the noise. Close your eyes to really see what’s in front of you, and then pick the best way forward for you and your team, relative to the organization’s needs.
You need a culture that high-fives small and innovative ideas. —Jeff Bezos
Culture, as the saying goes, eats strategy for breakfast.
“Put simply,” he wrote in High Output Management, culture is “a set of values and beliefs, as well as familiarity with the way things are done and should be done in a company. The point is that a strong and positive corporate culture is absolutely essential.”
The qualities prized by Andy Grove—collective accountability, fearless risk taking, measurable achievement—are also highly esteemed at Google.
Structure and clarity: Are goals, roles, and execution plans on our team clear? Psychological safety: Can we take risks on this team without feeling insecure or embarrassed? Meaning of work: Are we working on something that is personally important for each of us? Dependability: Can we count on each other to do high-quality work on time? Impact of work: Do we fundamentally believe that the work we’re doing matters?
