What are OKRs? (An how you can use them as a Product Manager)

did you know that there is one thing that companies like google spotify twitter airbnb and linkedin among many others shared that made them incredibly successful sure they have millions of users now but how do they get there all of them share the same thing they make decisions using okrs or objective and key results and what is the role of okrs in the world of product management come let's find out hey friend welcome back if you are new here my name is diego and i've been in product management for over five years i worked at companies like clinton and microsoft and on this channel i'm going to help you break into product management and become a great pm companies of every size and every industry are always looking for ways to increase performance and set organizational and individual goals are probably some of the most important things that you can do to succeed in the world of business it sounds easy but plenty of companies don't actually achieve their goals why is that well setting their objective can be very easy but knowing how to get there that is the difficult part so how do companies like google and linkedin and airbnb and many others manage to experiment fast and also launch so many successful products and features by following the okr method and okr stands for objective and key results and this goal setting methodology helps to set a clear goal and track measurable results but what exactly do all of this means well okrs keep you on track it focuses you on the most critical issues in the organization it started in 1954. peter drucker also known as the godfather of mother management published a book called the practice of management in which he talked about the mbo or management by objectives and we can thank peter drucker for some of today's principles in management such as defining objective for employees and managers as well as monitoring evaluating and rewarding employees it sounds very obvious today but it was very revolutionary at the time in the 50s later on in 1968 intel co-founder andrew grove evolved drucker's methodology into the okr framework that we know about today and it basically breaks down the biggest issue into two parts one the objective what do you need to achieve this should be simple concrete and action oriented and two the key results which is what will happen to help you achieve your objective it's a verification for the job done and it helps to keep it specific time bound and realistic for example let's say that you want to exercise and prepare yourself for a 10k run your goal is to complete this race under 50 minutes and you want to achieve it in the next six months this is your objective if you've never done a 10k run before you may not even know where to start and and which ways you are training to prepare for you to actually finish it under 50 minutes and by setting the proper key results you can have the confidence that you'll get there even if you don't have the experience for example first you will make a habit to run three times a week for at least 30 minutes this is to help you get your stamina and endurance up second you will increase the distance by one mile every week and third you will increase your speed by 5 seconds every week suddenly when you look at this plan knowing how to finish a 10k run in under 50 minutes if you've never done it before seems reachable the path looks kind of simple doesn't it well that's exactly the whole point of okrs but enough about running races all cars are important but as a product manager in this case why should you care are you responsible for the okrs will your team follow the plan to run the 10k races with you let's assume that you're the product manager for one of google's newest product they wanted to make revenue of i don't know 1.5 billion dollars from that product in the next year the point is that you have a big goal to accomplish and you have to chart the path to get to that goal as any pm you could start by listening to your customers the people in your team and other stakeholders on how to improve the product or maybe some way to solve new pain points but then you will be dealing with a lot of different opinions and before you know it you're gonna be drowning in feedback without a real game plan to achieve the goal of hitting 1.5 billion or whatever the goal is in your case that is where the okrs come in your objective is to hit this milestone in this example 1.5 billion dollars in revenue or again whatever the objective is and you want to achieve it by the end of next year how are you going to get there that's where we define the key results for example you can establish that some of your key results can be interviewing 10 customers per month to get feedback achieve product engagement of eighty percent weekly active users and grow up visitors by seven percent each month now i can guarantee that this specific key results will get you to the 1.5 billion dollars but hopefully you get to the point your key results should serve as a guide in the process on how to get to that goal now this process doesn't remove the fact that as a pm you will still be bombarded with feedback so how do okrs actually help with this well every time you get more feedback and ideas because you will check back with your all cares with that new idea that they just told you make a difference to the overall objective of achieve the 1.5 billion dollars by next year can we measure it against our key results no then it can wait as a product manager your users the business and its goals should take precedence anything that does not align with these goals can be discarded or at least put in the backlog or a site for later another advantage of using okrs is that as the pm in the group you need to get the buy-in from many different departments and stakeholders to work towards the common goal and since okrs are very easy to understand and they are transparent to everyone in the organization it's easy to check if you're headed in the right direction okrs can make the process of aligning different stakeholders much easier in fact in many cases if you're meeting with executive team your entire discussion will be based on okrs and how do companies apply this in real life let me show you a real example of how duolingo turned around its entire product by using okrs duolingo is a very popular language learning app it's fun it's easy and it has gained quite a fanbase in the recent years and in july of 2021 they actually went public in the market but not so long ago the company was struggling to keep one of its main features of today the duolingo stories alive if you've never used duolingo before dual lingua stories is a feature in which users can learn a language by listening or reading stories making learning much more fun than just repetition of words today it's a main feature in the app but back then this feature was about to be completely removed and duolingo was actually facing problems with its growth and retention of users conor walsh the product manager and at the time a brand new hire was given the task of reinventing duolingo stories and this wasn't easy the team behind duolingo stories was completely demoralized at this point and management have given up hope on this feature he did not have the time or resources to do any study to make any decisions so what did he do he used okrs and centered them around gaining a better understanding of what duolingo stories user experience was like instead of starting with an objective like increased duolingo stories traffic by 50 he started with a simple yet very powerful objective make duolingo stories the best product possible on its own this objective sounds too broad and impossible to achieve however to accomplish this he set the team's key results to include talking to a number of users to understand why the feature wasn't working understand their pain points and produce a document analyzing these pain points to come up with solutions well this was a very time consuming activity it actually worked this analysis allowed conor and his team to identify pain points that were categorized into high medium and low impact groups this effort helped him focus on the biggest problems affecting the future and create solutions based on those as we cover already taking every little issue or every piece of feedback into account is a complete waste of resources and time so just like conor and his team did you have to determine which problems have the biggest impact and focus on correcting those because okrs are meant to be simple and efficient conor didn't just use okrs to set a path for his team to reach success but he probably used them in conversations with other stakeholders and management to get their buy in after all somebody had to approve the plan and okrs help everyone understand what the team is going after and as the pm in the group it's your job to make communication easy for everyone and absolutely everyone to know what is the team trying to accomplish and okrs help with that conor's use of okrs to turn around this feature not only led to a big success in the company but it also caused a major redesign in its main product duolingo's app to center its use around stories a feature that not so long ago nobody cared about his focus on understanding the user experience helped him to create a much better version of duolingo stories and the users skyrocketed when he joined in 2018 stories had less than 20 000 users and after his redesign in 2019 the numbers went to over 80 000. in an interview conor spoke about his use of okrs as you learn more you can change the prioritization of your okrs there is nothing said about okrs it should grow it should change it's not static it's important for people to understand that okrs should be more of a guidepost rather than a roadmap and by the way if you're new to the product management role or even thinking about becoming one i have a great survival guide just for you check the description below because you can get some of my quick and easy templates for your first 30 60 and 90 day plans you're gonna get tracking sheets status updates and much more let me know if you have any questions about okrs and if you want to learn more about product management check out my other videos where i interview other pms and they talk about their aspect of the role and how to succeed in them don't forget to subscribe for more and i'll see you in the next video thanks for watching [Music] you

Channel: PM Diego Granados

Views: 12,637

Keywords: product management, product manager interview, product manager, product management interview, product management interview questions, google pm interviews, google product manager interview, circles method product management, product sense interview, product execution interview, product execution interview facebook, pm diego, product management execution questions, product management execution interview, OKR, okrs, okrs explained, okrs google, okrs john doerr, okrs vs kpis

Id: j3Vx_daAO38

Length: 10min 21sec (621 seconds)

Published: Tue Apr 05 2022