Should HR Teams Use OKRs?

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Hey folks, 

It’s the end of Q1 already. For me, at least, it’s been a whirlwind of a quarter. Between delivering client trainings and keynotes, Josh Seiden and I have been working hard alongside our trusted reviewers to finalize the manuscript for Who Does What by How Much?, our new book on OKRs. We can’t wait to share it with you next month. (And until then, you can pre-order the e-book here.) We’ve taken great care to write a book that is specific enough to be actionable but broad enough to be applied in as many contexts, disciplines and industries as possible. I’m excited to hear what you think of it. 

One of the fascinating parts of writing this book is that, with OKRs, our work is now coming right up against the work of human resources teams. With our earlier books, Lean UX and Sense & Respond, we focused on either the product teams themselves or the C-suite directly. With this new book on OKRs, there is a significant dependency on the work of HR across the board. 

I want to focus a few newsletters on our friends in HR and how OKRs influence their world, starting with this edition. I look forward to your feedback, especially if you work in HR, as we are still learning.  

- Jeff

Article: Should HR Teams Use OKRs?

In our new book, Who Does What by How Much?, we make the case that everybody has a customer. That is, for everything we create at work—regardless of what we do there—there are humans at some point in the process that consumes the thing we create, in one way or another. Those humans are our customers. If we approach our work through this lens, then our measures of success should be tied to positive behavior changes in those customers. These human-centric goals, or outcomes, are how we define goals in a world where everyone has a customer. 

We then look at those humans and determine our success criteria by asking the book’s titular question, “Who does what by how much?” The answer is our goal, written as a key result. Together, with a qualitative objective, we have OKRs. Through this lens, human resources teams are no different than any other team in the company, and yes, they should be using OKRs. 

Who is HR’s customer?

If we’re trying to change customer behavior and everyone has a customer, who is that for the human resources team? A brief analysis comes up with at least three customers of HR. 

1. The employee

HR makes policies that employees have to comply with. They provide learning and development opportunities, content and systems. They define performance management criteria and run assessments. All of these activities (and lots more) generate outputs. Sometimes those outputs are reports, and sometimes they’re new tools. In all cases, the customer is the employee of the company. Simply deploying these policies and programs does not, however, equal success. What if no one followed the policy? What if no one used the learning products the team developed?

The real measure of success for the HR team when it comes to the employee is whether or not employees changed their behavior in a positive, meaningful way. How many folks completed the training programs using the tools provided by HR? Did the new vacation policy encourage folks to take more or less time off? How many new employee referrals did they see in the last quarter? These are the measures of success for the work the HR team is doing for the employee. And yes, these are key results.  

2. The executive team

HR has the executive team as their customers as well. This focuses on workplace productivity, incentives, employee engagement and employee costs. HR prepares hiring plans and, at times not unlike these, downsizing plans. But, again, simply producing these reports and plans and policies doesn’t mean they provided any value to the executive team. Did the executive team read the policies? Did the policies lead to people asking more or less questions? Was this work cited in any major shifts in corporate policy?

If the answer is “yes” and that’s a measurable “yes,” then the HR team satisfied their customer. But if the answer is “no” or “not sure,” the HR team needs to figure out where their work is meeting the needs of the executive team and where it isn’t. In all cases, we want to see if the executive team changed their behavior due to HR’s deliverables. Again, OKRs help the HR team understand that. 

3. The prospective employee

Good job descriptions are a dime a dozen, right? Nope. The good ones make it clear what the role is looking for and attract qualified candidates. The bad ones attract a lot of noise. Onboarding practices can range from elaborate and personalized to quick and incomplete. Which approach is best for attracting and retaining new staff? 

As in the other examples, the HR team is going to make some assumptions on how to best attract, interview, hire and onboard prospective employees. The measure of that work is not the fact that it exists. The measure is how many qualified employees come in the front door, interview successfully, take the new job when offered, onboard efficiently and stick around for more than 90 days (for example). Again, these are all behaviors that can be measured and, as the data fluctuates, used to drive changes to these processes and practices. 

HR having OKR experience will improve everyone else’s experience

Ultimately, the folks in HR will be responsible for deploying OKRs to the rest of the organization. Doesn’t it make sense that they should try them out first? This way, their first-hand experience can help them dictate better policies and performance criteria for the rest of the organization. 

HR has customers. Those customers consume what HR makes, and their resulting actions and behaviors clarify where HR’s work has hit the mark and where it can be improved. Hands-on experience with OKRs can only make a broader OKR rollout more successful. In this way, not only should HR use OKRs, they should be the first to do so in the company. 

I’d love to hear your thoughts and experiences on this topic (especially if you work in HR).

What I've been up to

My co-author and longtime business partner and friend Josh Seiden bakes bread. And he’s very good at it. So, I decided to give it a shot, and I made bagels. You can see them in the pic below. 

They came out much better than expected. Actually, I had no idea what to expect, but I was pleased with the results and, as evidenced by my daughter taking a second one without my prompting, I think the family agreed. 

Aside from randomly baking stuff, I’ve done a small amount of traveling while continuing to deliver product management, Lean UX and OKR training to corporate clients. The other thing I’ve really enjoyed doing lately is in-house keynotes. This year has seen a spike in requests for these presentations and, as someone who used to be on stage with bands, this makes me happy.

Watch, Listen, Read

Watch: The Signal (Netflix) – Netflix has another German-language, sci-fi series going with The Signal. With only four episodes that are about an hour each, it was a no-brainer for me to watch it. Focused on a brilliant scientist who’s tasked with finding extraterrestrial life, things get weird when she thinks she’s found it.

Listen: Air – French synth-pop legends Air are now on tour performing the entire Moon Safari album. It’s been on repeat at Gothelf HQ for a few weeks now. 

Read: The Spinoza Problem by Irvin Yalom – The true story of a 17th-century Jewish philosopher ostracized by both the Christian and Jewish communities, this book is a fascinating look at how history takes a long arc to get to the right place.

What’s new on the blog

Avoiding Local Over-Optimization with OKRs – We tend to set aggressive key result targets and try to regularly hit 70-80% of them. If we get close, we’re likely to push as much as we can to hit our targets. At some point, though, it stops making sense to keep going. How can we tell when we’ve reached that point? Look at our pace of progress and cost of progress. More on these factors—plus an additional tip for gauging your progress—in the blog.

Want OKRs to Succeed? Start with Why – “People don’t buy WHAT you sell; they buy WHY you sell it.” This Simon Sinek quote may be annoying, but I can’t deny that it’s spot on—not just for products, but also for processes. Often, leaders introduce OKRs to their organization without sharing why they’re making the team change the goals and ways of working they’re used to. Without any insight, folks resist the change and it fails. For OKRs to succeed, leaders must start by telling their teams WHY.