The main objective of the OKRs framework is to align the product roadmap with the business challenges using the same target names and metrics. Instead of prioritizing features (outputs), we align on expected targets (outcomes). That way, product teams are empowered to be more ambitious and creative to achieve the objectives.
One of the critical phases is the prioritization and definition of the OKRs. The best way is to combine a top-down (C-level setting the key company objectives) with a bottom-up approach (product teams proposing the OKRs).
This article focuses on the best practices to achieve this for a company of the size of Ontruck (~160 employees). We have three product teams, five C-level, and around ten key business stakeholders). If your company is smaller, you may want to simplify it. If it's bigger, you may need extra steps within the product team.
Aligning product teams with C-level and key stakeholders is easier said than done. You usually face the following problems:
- Some C-level don't understand why you want to prioritize certain KRs
- Some key stakeholders would expect to prioritize other targets instead
- Many of them don't feel involved enough in the prioritization
- Many of them don't know if the goals are ambitious enough, and if you can commit 100% to some KRs
It's essential to solve these issues because you need the trust of C-level and the full commitment of the key stakeholders to enable empowered PMs and product teams.
Best practices to align
I recommend the following practices to align Product OKRs:
- Empower PMs to drive the conversation and propose Objectives and Key Results
- CPO must set the product vision, and aggregate and unify the different perspectives
- Use a single doc as the central repository of all discussions with business
During the last two years, I've iterated several times how I align the Product OKRs with the rest of the C-level. I've found the following six steps to be the most effective.
1. C-level sets company objectives
They can be annual or semi-annual, depending on the stage of your company. Either way, C-level needs to do this exercise of high-level prioritization of the main targets of the company in advance. These objectives need to be propagated to the teams, so they can set goals and prioritize their work. Therefore, each of them will have a subset of targets.
2. PMs propose Product Themes for next quarter
Three weeks before the end of the cycle, PMs work with their teams and business stakeholders to propose the product themes and objectives for the next cycle.
- Product Theme
- Categorization of customer needs or problems, e.g., Order creation
- What you want to achieve, e.g., Answer all quotes instantly
PMs need to combine different perspectives:
- Business stakeholders who see their opportunity to prioritize their challenges and opportunities.
- Design and Engineering who want to keep iterating current OKRs as there are many opportunities yet to explore
The best practice I've found is to have one single Product OKRs document on which each PM writes the product themes she wants to prioritize with current status, objectives to achieve, and the rationale to prioritize them. It's also important to add the themes they would leave out of scope, explaining the reasons.
I do some back-and-forth with my PM team to make sure we are prioritizing the right themes from my point of view, and we are explaining well the rationale with metrics.
3. C-level gives feedback on Product Themes
I share the Product OKRs document with the rest of the C-level, and I organize a C-level session to gather their input. I ask them to review and comment directly on the document.
As C-level can diverge a lot in this session, I suggest you set up a dynamic to manage the conversation. One that works for us is the following.
- For each product team (10 min):
- 1. Have one post-it per product theme on the wall. Give them 3 minutes to order the post-its by importance. They can't talk during these minutes. They can add up to two new themes in total. The idea is that they debate the order. Insist that they do it in silence because they would want to talk.
- 2. In the next 7 minutes, they can speak. Ask if everyone is aligned in the order, what's the rationale for the highest and lowest priorities, and especially try to understand the difference of opinion to what the PM team is thinking.
The outcome of this session is that all C-level agree on the key priorities, and you get structured feedback to give back to the PMs. Write down the feedback on the same document, and have individual sessions with each of the PMs to discuss the feedback.
4. PMs propose OKRs
During a week, PMs work with their teams and business stakeholders to define the Objectives and Key Results for the next cycle. PMs must share the C-level feedback with their business stakeholders. That way, everyone is on the same page; and if they don't agree, they can talk to their corresponding C-level.
In a previous article, I shared some best practices on settings the right OKRs. On top of them, I suggest you give more importance to phrasing the Objectives to make sure they are ambitious. Remember that they may endure several cycles of OKRs. The right phrasing can help teams focus on the final objective and not just on the Key Result, in case they are having problems impacting it.
To align them back with C-level and key business stakeholders, I recommend that PMs restructure the Product OKRs document and write down the proposed OKRs. They need to add the previous work, vision, and rationale to prioritize them.
I do some back-and-forth with them to make sure we phrase and scope the OKRs in the right away, they are ambitious, and they have the resources to execute.
5. C-level approves OKRs
I share the updated Product OKRs document with the rest of the C-level, and I organize a session with C-level and PMs to discuss and approve the OKRs. I ask them to review and comment directly on the document. As we solve the doubts, we close the comments.
By the beginning of the session, most of the Key Results should be clear. Its objective is to discuss live the pending comments and last details:
- Prioritization doubts that still arise about certain KRs
- Pending scope or targets that needs to be agreed with C-level
- Concerns raised by PMs on topics that must happen in business areas so they can execute
If you have done an excellent job before, a one-hour session should be enough for C-level to approve the OKRs. As a productivity tip, you can solve the latest details with the corresponding C-level during the following day.
6. Communicate OKRs
Last, PMs update the Product OKRs doc, and I share it with key business stakeholders highlighting that the C-level has approved those OKRs. We may make some minor changes in the following days, but we are ready to start the new cycle and communicate the new Product OKRs to the rest of the company.
As you can see, we spend quite some effort defining and aligning the Product OKRs with the C-level and key stakeholders. My experience is that you save tons of hours of discussions during the OKRs cycle for every hour you spend aligning at the beginning. Following these best practices, business stakeholders are committed, and your product teams can advance quickly on their objectives.