- Successful startups get things done. Today I'm gonna show you the system that we've used for the past five years to really get things done. This is Raw Startup. I'm the founder of Vivino. And when we launched Vivino there were 600 wine apps in the app store. There was fierce competition. Today we're 10 times
bigger than number two. We have 33 million users and 20,000 people install Vivino every single day. We've used the OKR system
for the past five years. I believe it's one of the
reasons why we really won. We got things done and we
got the right things done. Today I'm gonna show
you a seven-step process to help you implement
OKRs in your business. There's always this one project that just doesn't get done. A few years ago we were releasing a new version of our website, and we just couldn't get it to release. We were an app company and
everything focused on the app. On top of that, we just
had too many projects. We'd reached 20 people or so, and we knew we needed some kind of system to manage all these projects. That's when we implemented the OKR system, we got the website released, and today I'm gonna show you
exactly how to be more focused, get more done with the OKR system. First and foremost, let's do
an eight-second history lesson. OKR stands for objectives and key results, invented by Andy Grove,
co-founder of intel, evangelized by John Doerr, and made famous by Google. Google has used them since 1999 when they had 40 people. They still use OKRs
today with 60,000 people. OKRs can be used in any size of company. That's the history lesson for today. At Vivino we used OKRs to run our projects in quarterly cycles. It worked incredibly well. Let's take you through
the seven step process. Let's start with number one. Step number one, set the
high level objectives. Too many companies try and do
10 things at the same time. Don't. Do one or two things and have
everyone run towards that. It is so much more efficient. For this OKR process, this high level is the foundation of everything
so you have to do it right. Let's get started. Setting the high-level objective is usually done by top management, two or three people in
the leadership team. That doesn't mean you don't
listen to everybody else, you certainly do, but in the end it's set by two, three people
in the top management. So the question is, what is the primary objective for this quarter. For us it was usually one or two things with the primary high-level
objectives for that quarter. Here are some examples. In Q2 of 2016 we wanted to monetize better as well as improve the net promoter score. Very clear objectives for that quarter. Later in Q4 of 2016 we also
set some very clear goals. We wanted to be profitable in November, and we wanted one day with
at least a thousand orders on our marketplace. Both clear and measurable goals. For this video I will use an example we can use throughout the video. We will have an E-commerce
site that sells T-shirts. And so let's start by setting the high-level objective for the quarter. In this case we want the objective to be to increase the sales by 20%. We start by making a slide with the company objective and add it. So now there we have it. The high-level objective. Let's move on to step number two. Step number two, break the objectives down to projects and key results. Now you have the high-level
company objectives. Let's break that down to projects. At Vivino we usually do three
to six different projects. It all depends on how big the company is, how much bandwidth you have. But don't do too many projects. It becomes very clear when too many people are on too many projects. So don't do it, nothing will get done. So now things are getting interesting. We're gonna take it down to project things that we actually wanna do. We want projects that help us reach the high-level objective. This is still the top
management that does this. We'll wait a little bit before
we take it to the teams. To keep things simple
for our test project, we'll only do one. And that project is to
start selling polo shirts. And now we add the project to
the company objective slide. As you can see here we
now have a separate slide for the new project called
start selling polo shirts. Before we start adding the key results, let me stress you don't
put all projects into OKRs. OKRs are for new stuff,
things you're building, innovating, new business. That's what OKRs are for. Don't put your day-to-day
business into an OKR. Now let's find some key
results for the polo project. First of all, let's find
out what key results are. Well, key results are what
the word literally says. The key results we want
to get to on this project. What do we wanna reach for this
polo project, for instance? There are some requirements
to these key results. They must be specific. No soft goals of any kind. Must be very, very specific. Stretch goals. The goals should make you feel
a little bit uncomfortable, doable but not easy. Measurable. You must be able to
measure very specifically if you reach them or not. Always put a specific
number into the key results. If you wanna open E-commerce site and start selling something don't just say open an E-commerce site. You should rather say, open an E-Commerce site and get 50 orders. This way you get what you actually want, because opening an E-commerce
site could be something. But once you get 50 orders it's very real. Now let's go back to the T-Shirt company. What's a good key result here? Obviously, we wanna sell some polos, but what's the actual key result? For this project a good key result is complete 50 orders with polo shirts. Again, we're not just saying
start selling these things. We're actually saying
complete some orders, and thereby getting closer to the high-level objective
of increasing revenue. For the simplicity of this video we only do one key result, but it's pretty normal to do two, three, four, or five key results
for a single project. Now let's move on to step number three. Step number three, set the team. We now have the key
results, let's find the team that can reach those key results. This is obviously a very, very important part of the process because
these are the people that are actually gonna do this. So to find the right team, you need a team that is
completely autonomous and has all the resources needed to complete the project
and reach the key result. First thing we need to find is a lead. The leader is the one who's responsible along with the team, obviously, to actually reach the key result. Usually the lead is a big stakeholder or somebody who's gonna
do a lot of the work that needs to be done, maybe even both. One of the reasons why this is such an important part of the process. It's because this is when you realize you can't do everything. When you start putting
team members on here you'll see that some people
are on multiple projects. You can put a person
on one or two projects. You really shouldn't put
them on more than that. They will be stretched thin
and you can't do anything. You may have to kill some
projects at this stage. You find out that some people
are just stretched too thin. This is a very, very good,
important, and healthy part of the OKR process, finding out that you can't do everything. You have to make some hard choices. So, don't try and do everything. You will fail. This is all about priorities. You gotta find out what
you really wanna do and what you really can do
with the resources you have. Let's have a look at our
example T-Shirt company. For the start selling polo shirts project, we're gonna do the following team. Sarah's gonna be the lead. She's the buyer. John is gonna do merchandising. Brian's gonna do marketing. And Sandra's on the web team. There you have it, we
have our first project. We have a team, we have some key results to start selling polo shirts. With all that in place, let's
move on to step number four. Step number four, have the
teams do a monthly breakdown. Time to put the team to work. They get the project slide with the team and the key results. Their job is to break
that down into months. Months with initiatives and key results for every single month. So the team now knows they have to complete 50 orders with polo shirts. Their job now is to break
that down into months and what do they need to get done to get 50 orders with polo shirts before the end of the quarter. We assume that it's Q1, so we have January, February, and March. The key results for the
quarter is to complete 50 orders with polo shirts. Now we do a new slide for each month. On the left we have the key result and on the right we have the
key results actually achieved. Let's have a look at what that looks like. First we have January. Find 30 polos that should be listed, and after that order the 30 polos. In February we have
polos in the warehouse, create all content and
photos for all polos. And in March add to E-commerce shop. Do a Facebook campaign that generates at least a thousand visitors with a budget of $500 and sell the 50 polos. That's it, now the teams know
exactly what needs to be done each month to ultimately
get to the key result of selling 50 polos that quarter. A quarter can seem like a long time. But breaking it down to
months works really well. A month is enough time to get stuff done, but also creates a
healthy sense of urgency. With all that done, let's
move to step number five. Step number five, announce it
to everyone in the company. This is very important because
it gets everyone online. It gets everyone in the
company working towards the same objective. Everybody knows that this is
what's important this quarter. For the people working on the actual OKRs, they'll get leverage. They can tell everyone else, hey, you need to help me
with this, it's an OKR. If everyone is at the same location you just set up a presentation and show the presentation
you've already built. You start with the
high-level company objective. Then move to the projects and key results. Then all the way down to each project. All in all an important thing to do, because everybody knows
what the objective is for the quarter, and you're
just more likely to get it done. Anything OKR is open to
everyone in the company. So make sure the
presentation you actually do is in a shared folder that
everybody has access to. With everyone onboard, let's
move to step number six. Step number six, do a weekly check in. Now we have to make sure
the ball keeps rolling. Some people make the mistake and think that things will just run automatically. They usually don't. You have to check in
throughout the quarter. Schedule a meeting or a call every week, same time every week. I prefer a call, actually. But if everyone's in the same office, that's kinda ridiculous. So if everyone's in the same office, maybe a standup. Maximum 50 minutes, get it done quickly. There's one call for each project. The participants are all the
team members of the project as well as the one person that runs the OKR projects from management. Make sure the projects on track and make sure they get
any resources needed to complete the project. All of this is just a short check in. It is important for the
process to do this every week. It makes sure that there
are no showstoppers that get too big. We just solve the
problems on a weekly basis and someone from management
is really there to help. These meetings keep going
throughout the quarter. Let's move to step number seven. Step number seven, score
and announce the project. Okay, we're now at the end of the quarter, time to announce and score the project. I can't stress enough
that this is not about pointing fingers. This is about learning and get even better in future quarters. So every single project
initiative is gonna get a score. There are different ways of doing this. Some people use a score from zero to one. We just use different smilies. So that's what I'm gonna show you today. We have three levels of smilies, not happy, medium, and happy. This is something that the team does. They add what they achieved and the smiley next to each initiative. Now let's get back to our T-Shirt company and look at selling polos. Let's go through it really quickly. In January, we wanted 30
polos and we found 25. Okay, happy smiley. We ordered 24 out of the
25, also okay out of the 30. Get into February we wanted to have the polos in the warehouse. Apparently they arrived very, very late. So we got a medium smiley on that. And secondly we wanted to create content and photos for all these polos. They arrived late so we're
pretty unhappy with that. Get into March. We got the things we didn't
done in February done, and we started adding
it to the online shop. Everything was added and we're happy. Then we wanted to do a Facebook campaign that got us 1000 visitors. Unfortunately, costs
were a little bit higher, and we only got 600. So we're kinda medium on that one. In the end, we ended up selling 45 polos and we wanted to sell 50. So we're pretty happy with that. Then we zoom out and look
at the overall project. So start selling polo
shirts, complete 50 orders. We got to 45 so we're
pretty happy with that. That's it, we've gone
through the entire quarter. Now it's time to show everyone how we did. We pretty much have a presentation because that's part of the process. So we show this to
everybody so they can see all the way down to every
single project how we did. Then finally we give them an overview of how we did for the entire quarter. Here are the seven steps. So there you have it. Go through these seven
steps and implement OKRs. I guarantee you it will
change your business. If you get OKRs working you
will get more things done. You'll also get the right things done. And that's really what
matters if you wanna win. There are all kinds of
different ways of doing OKRs. We did it in a certain
way at the company level. Others do it all the way
down to the employee level so employees have their own OKRs. I'd love to hear from you
guys if you seen other methods other scoring systems, whatever. Put it down here in the comments. I'd love to hear about it. If you want more videos to help you build your amazing startup please subscribe to my channel right now. Thank you very much for watching. (upbeat music)
