Measure What Matters by John Doerr (Summary & Review)

About The Author (John Doerr)

John Doerr is an American venture capitalist at Kleiner Perkins, based in Menlo Park, California. He is an advocate for venture capitalists investing in high-growth technology startups, and for the use of Objectives and Key Results (OKRs) as a management system.

His book, Measure What Matters, outlines the history and implementation of OKRs in various companies, including Google and Intel.

He co-founded the Doerr Institute for New Leaders, a non-profit that provides leadership development and training to high-potential students from diverse backgrounds.

Who is this for?

Measure What Matters is a must-read for entrepreneurs, executives, and business owners who want to make sure that their team is working on the right objectives, and that the objectives are aligned with the company’s vision.

It’s also great for anyone who aims to learn how to set OKRs and use them to track their progress and success.

Finally, it’s great for those who wish to create a positive and value-based culture in their organization, and learn how to use feedback as a tool for growth.

Bullet Summary: Actionable Key Takeaways

• OKRs (Objectives and Key Results) provide a clear roadmap to achieve goals, measure progress, and stay focused.
• OKRs should be clear, action-oriented, focused, and measurable.
• Aspirational objectives help companies to expand and scale beyond their limits.
• CFRs (Conversations, Feedback, and Recognitions) are an alternative to annual performance reviews.
• A healthy culture reflects the organization’s values and encourages employees to be creative, productive, and engaged.

Measure What Matters Detailed Summary

In this book summary, you’ll learn:

• Why every company must have OKRs and why simply having goals is not enough?
• Why are transparency and feedback crucial within any company?
• How big companies like Google or Intel create positive and value-based workspace culture in their offices to make sure all the teams and individuals have right direction and approach?

The lessons or strategies discussed in this book summary have been followed by big companies like Google, Intel, etc.

This means if you understand every lesson discussed below, you can 10x the growth of your company.

Alrighty, so without further ado, let’s get started.

Lesson #1: Execution is more important than ideation.

We all get thousands of ideas every day.

Every person who runs or works for an organization also gets lots of ideas.

But then why do we see many organizations work without any proper direction?

This is because they don’t know proper execution.

Ideas tell us what could be done. It comes with a possibility.

But if you don’t execute your ideas, nothing gets done.

Execution where all organizations can improve upon.

The challenge is: How do one organize ideas? And how to make sure that things get executed with a proper plan?

Obviously, companies need focus to move in one direction and improve their services.

Again, how do people at top-level make sure that the people are focused and working towards a common goal?

Execution of ideas with planning is crucial for any company to grow.

Unless you execute, it’s tough to figure out whether your idea is practical or not.

Considering the rapidly changing business environments these days, entrepreneurs need to adapt quickly.

But this doesn’t mean that idea generation is not important.

Without ideas — without creative juices flowing in the minds of people within a company — businesses will fail to come up with solutions.

The problem is: Every business is unique in itself, with its own set of challenges.

If the ideas aren’t practical enough, they will only slow a company down.

Most people conceive ideas and execution as one thing. But they’re very different from each other.

They are connected, no doubt, but they are not the same.

Successful companies know this well. And this is what separates them from other companies that are not successful.

All the strategies and planning are useless if they don’t get executed.

Let’s learn more in the next lesson.

Lesson #2: Set clear OBJECTIVES and KEY RESULTS at all organizational levels to stay focused.

What should entrepreneurs and founders do to make sure their ideas get executed with a laser sharp focus by their teams?

In other words, what’s the best approach to turn their IDEAS into ACTIONS?

The solution is: Know what to do and what not to do.

The author talks about setting OKRs against traditional goal-setting and annual performance reviews that most companies or organizations follow.

What are OKRs?

“OKR” stands for “Objectives and Key Results.”

Let’s break it down so that we understand it properly.

OKR is made up of two term as shown below:

OKR = OBJECTIVE + KEY RESULTS.

“Objective” means what you want to achieve.

Do you want more sales?

Or you want more social media reach?

Anything that you aim to achieve for your company is your objective.

“Key results” define what the result will look like once the objective has been achieved. In short, they act as a benchmark or metric to define success and failure.

The right way to set Objective is to make sure they are:

• clear
• action-oriented
• focused
• measurable
• trackable
• easy to understand
• concrete and executable

For example:

I will [OBJECTIVE] by doing [STRATEGY] in [TIME FRAME] so that [KEY RESULT].

Or simply put:

• I will [objective] as measured by [key result].

What’s the significance of setting good OKRs?

Most organizations often get caught in their fuzzy thinking; thus they become inefficient in executing their plans.

Setting OKRs makes sure that every individual, from CEO to an employee, everyone knows what to do and what not to do.

OKRs help the founders of any company eliminate all kinds of doubts. And thus help the company progress with focus.

Depending on how complicated the objectives are, OKRs can change. Usually, there are n number of Key Results with one Objective while setting OKRs.

The fun part is: You can even set OKRs for your personal life as well to become highly productive.

For example:

If you want to limit your social media consumption this year, you can set OKRs as shown below:

Objective: Limit social media consumption in next 5 months.

Key Result 1: Turn off mobile 1 hour before going to sleep.

Key Result 2: Replace social media with reading.

Key Result 3: Spend time with nature and don’t take mobile with yourself.

What are the benefits of setting OKRs?

Although setting OKRs may sound boring, it’s actually an interesting exercise that will force you to think clearly.

• It helps you stay focused on your goal.
• It makes sure that all teams and individuals have their goals tightly aligned with each other.
• It helps you track your progress.
• It helps the companies stay committed to their purpose and vision.

How many OKRs should one set?

Remember, OKRs can be flexible. So depending on what you want to achieve, you can set any number of OKRs. They can be set both on a company-wide scale and on an individual-scale.

But you also don’t have to go overboard in creating OKRs.

Make fewer and quality to get the best results.

Okay…

Now you’ve set your OKRs, but do all individuals in the company understand them?

How can founders make sure they are executed by their employees?

Let’s learn more in the next lesson.

Lesson #3: Transparency in key results helps everyone stay aligned and collaborate efficiently.

Every company struggles in communicating their values to their teams and departments.

That’s why companies must have TRANSPARENCY in whatever they do.

Transparency in key results is essential for everyone to stay on the same page. It helps ensure that everyone is aware of progress and any changes that may need to be made.

This helps avoid miscommunication and ensure that everyone is working towards the same goal.

All members of a company appreciate when their work is appreciated.

But if there is no transparency in how the performance is tracked or measured, their work might be underappreciated.

The basic idea is: Everyone must know about OKRs.

Thanks to recent technological advancements, companies can have their cloud-management systems to track everything.

Here is why companies should use cloud-based systems:

• They are easy to use and maintain. As they are connected via internet, they are easy to store and maintain through the year.
• They are secure. Cloud-based systems are highly secured compared to other systems. In fact, these days they create copies of your databases and allow backups; thus your data is easy to restore in case something goes wrong.
• They make collaboration easy. Gone are the days when you had to sit in an office to collaborate on big projects. Modern cloud-based software programs allow teams to collaborate and network easily in real-time.
• They are highly affordable. You might think they are expensive. But no, they are highly affordable, thus allowing to spend your resources in other areas.

The thing is: If all team members know what exactly they are doing, they will find it much easier to focus.

Focus is difficult without clarity.

Collaborating efficiently also gives all teams enough motivation to work, as it gives you a sense of purpose.

Lesson #4: Track your objective parameters to stay accountable.

The title of the book, “Measure What Matters”, emphasizes the importance of measuring anything necessary to ensure that a company’s objectives are met. This gives an accurate understanding of progress and helps to make informed decisions.

It could be anything, such as:

• Marketing related: number of visitors on your website, number of leads/sales, number of followers on your brand account, etc.
• HR related: Employee satisfaction rate, number of employees engaged, etc.
• Product/Service related: number of successful products, conversion rate, launch dates, etc.

If you don’t track your numbers accurately, you won’t fully understand your company’s growth.

OKRs won’t work if everyone in the team isn’t involved.

Tracking numbers also helps everyone to stay accountable.

Companies should do quarterly or annual revision cycles to make sure the most important objectives are met.

Remember, OKRs are not set in stone. If assessment reveals a need to change them, feel free to do so.

There should a proper method to let the employees know their progress. That’s why it’s better to keep the results public so that there is full transparency and accountability.

It also helps if the key objectives are easy to understand and clearly defined so that there is no confusion later.

Okay, so now we know that setting goals is essential — and they should be transparent enough, so they can be tracked and accessed easily.

But what about scalability?

Companies don’t stay the same, do they?

As they progress, they expand.

How should top-level management make sure that the company is flexible enough to changes?

Let’s find out in the next lesson.

Lesson #5: Set aspirational objectives for your company in addition to regular ones to push your limits and explore new possibilities.

The author talks about stretching your OKRs.

Every company must have aspirational objectives.

What do they mean?

Aspirational goals are different.

Allow me to explain with an example.

Think about giant companies that are already successful in their market.

Let’s say, Intel.

They are too big to fail.

But they still keep working to improve their brand.

They all believe that their company could be bigger than it already is.

There are normally two types of objectives.

Initially, when the company is just a startup, it has different goals. It requires more brand awareness, more customers, etc.

But when it becomes, it has so many options to expand.

For example, they can expand internationally, or they can potentially target a different market. It could be anything.

Aspirational objectives allow the company to expand and scale beyond its limits.

Such objectives are usually challenging as they focus on something bigger.

The chances of failure increase significantly when you try new things.

But without those risks, growth will get limited.

Founders must have such aspiring objectives along with other basic objectives so that they keep growing the company and inspire others as well during the process.

For instance:

Google has two types of objectives: Stretch and Committed. The former are ambitious goals that may be difficult to achieve, while the latter are more achievable and realistic. Both types of objectives are essential for the success of the company.

Ambitious goals can be rewarding, but they also come with the risks, especially if you don’t have enough cash to take such big chances.

To mitigate this, it’s important to have a backup plan in case things don’t go as expected.

On the other hand, if you succeed, the growth can be drastic.

Lesson #6: Avoid blocking conversations, recognitions, and feedback within the organization.

The author also discusses CFRs as an alternative to annual performance reviews.

Those reviews aren’t much effective today.

Instead, companies should adopt continuous performance management.

It means regularly checking the performance of employees and managers on a weekly or monthly basis.

There are 3 things to focus on:

• Conversations. It’s best if employees and managers do one-on-one meetings with each others and discuss if they can improve anything within the company. Managers can guide their employees and check whether they’ve met all their goals or not. Furthermore, employees should feel free to discuss anything that is stopping them from being more efficient. The conversation doesn’t always have to be formal.
• Feedback. Employees will not tell their flaws by themselves, that’s why managers are required to judge the performance of the employees without any biases. If the feedback is positive, managers can give it publicly or privately. But avoid harsh negative feedback in public.
• Recognition. Everybody loves recognition. If employees show a great performance, managers must appreciate it. This motivates employees to perform even better. Never underestimate the power of giving recognition.

These 3 things together form the foundation of Continuous Performance Management.

When grouped together, they are commonly referred to as CFRs.

CFRs happen during the OKR cycle, and only help make sure that OKRs are met properly in time, as they encourage transparency between the managers and employees within the company.

Lesson #7: Create a healthy and positive culture that reflects the organization’s values, with a common purpose at its center.

A positive and healthy culture is the foundation for any successful organization.

But what is a culture? And what a healthy culture looks like?

Culture in a company is the set of values, beliefs, and habits that define how a company operates.

It is the collective personality of the company and reflects the company’s purpose and values. It is the way employees interact with each other and with customers. Not only that, but it is the environment that employees work in and the organizational norms that govern their behavior.

In short:

An organization’s culture should be a reflection of its values, nothing more, nothing less.

A healthy culture is one that is built on trust, respect, and collaboration, and encourages employees to be creative and take risks. It also encourages open communication and feedback so that employees can learn from each other and grow.

When you combine OKRs and CFRs, it allows you to create a healthy workspace culture.

A healthy culture also provides employees with a sense of purpose, meaning, and belonging.

It is essential for fostering a creative, productive, and engaged workforce.

Measure What Matters Review

Last update on 2023-02-15 / Affiliate links / Images from Amazon

Pros

1. Some concepts can also be applied in real life. For example, you can set OKRs to get rid of your bad habits or learn a new skill.

Cons

1. Too technical. The concepts discussed or not for everyone. If you’re not a founder or entrepreneur, I doubt this book will help you much.

Overall, this book was a great read.

I’ll try to set some more aspirational goals after reading this book.

I highly recommend you purchase this book and read or listen to it.

You can buy the book in your preferable format below.

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