Strategy Deployment and OKRs

This is the another post in my series comparing Strategy Deployment and other approaches, with the intent to show that there are may ways of approaching it and highlight the common ground.

In May this year Dan North published a great post about applying OKRs – Objectives and Key Results. I’ve been aware of OKRs for some time, and we experimented with them a bit when I was at Rally, and Dan’s post prompted me to re-visit them from the perspective of Strategy Deployment.

To begin with…

Lets look at the two key elements of OKRs:

  • Objectives – these are what you would like to achieve. They are where you want to go. In Strategy Deployment terms, I would say they are the Tactics you will focus on.
  • Key Results – these are the numbers that will change when you have achieved an Objective? They are how you will know you are getting there. In Strategy Deployment terms I would say they are the Evidence you will look for.

OKRs are generally defined quarterly at different levels, from the highest organisational OKRs, through department and team OKRs down to individual OKRs. Each level’s OKRs should reflect how they will achieve the next level up’s OKRs. They are not handed down by managers, however, but they are created collaboratively by challenging and negotiating, and they are transparent and visible to everyone. At the end of the quarter they are then scored at every level as a way of assessing, learning and steering.

As such, OKRs provide a mechanism for both alignment & autonomy, and I would say that the quarterly cascading of Objectives, measured by Key Results, could be considered to be the simplest form of Strategy Deployment and a very good way of boot-strapping a Strategy Deployment approach.

Having said that…

There are a few things about OKRs that I’m unsure about, and that I miss from the X-Matrix model.

It seems to me that while OKRs focus on a quarterly, shorter term time horizon, the longer term aspirations and strategies are only implied in the creation of top level OKRs and the subsequent cascading process. If those aspirations and strategies are not explicit, is there a risk that the detailed, individual OKRs don’t end up drifting away from the original intent?

This is amplified by the fact that OKRs naturally form a one-to-many hierarchical structure through decomposition, as opposed to the messy coherence of the X-Matrix. As the organisational OKRs cascade their way down to individual OKRs, there is also a chance that as they potentially drift away from the original intent, they also begin to conflict with each other. What is to stop one person’s key results being diametrically opposed to someone else’s?

Admittedly, the open and collaborative nature of the process may guard against this, and the cascading doesn’t have to be quite so linear, but it still feels like an exercise in local optimisation. If each individual meets their objectives, then each department and team will meet their objectives, and thus the organisation will meet its objectives. Systems Thinking suggests that rather than optimising the parts like this, we should look to optimise the whole.

In summary…

OKRs do seem like a simple form of organisational improvement in which solutions emerge from the people closest to the problem. I’m interested in learning more about  how the risks I have highlighted might be mitigated. I can imagine how OKRs could be blended with an X-Matrix as a way of doing this, where Objectives map to shared Tactics and Key Results map to shared Evidence.

If you have any experience of OKRs, let me know your feedback in the comments.

What’s the Difference Between a Scrum Board and a Kanban Board?

During a recent kanban training course, this question came up and my simple answer seemed to be a surprise and an “aha” moment. I tweeted an abbreviated version of the question and answer, and got lots of interesting and valid responses. Few of the responses really addressed the essence of my point, so this post is a more in-depth answer to give more detail.

When the question came up, I began by drawing out a very generic “Scrum Board” as below:

Everyone agreed that this visualises the basic workflow of a Product Backlog Item, from being an option on the Product Backlog, to being planned into a Sprint and on the Sprint Backlog, to being worked on and In Progress, to being ready for Accepting by the Product Owner, and finally to being Done.

To convert this into a Kanban Board I simply added a number (OK, two numbers), representing a WIP limit!

And that’s it. While there are many other things that might be different on a Kanban Board to do with the flow of the work or the nature of the work, the most basic difference is the addition of a WIP limit. Or to be more pedantic you might say an explicit WIP limit, and as was also pointed out (although I can’t find the tweet now), its actually creating a pull signal.

Thus, the simple answer to the question about the difference between a Scrum board and a Kanban board is that a Kanban Board has WIP Limits, and the more sophisticated answer is that a Kanban Board signals which work can and should be pulled to maintain flow.

Of course, this isn’t to say that Scrum teams can’t have WIP limits, or pull work, or visualise their work in more creative ways. They can, and probably should! In fact the simplicity of just adding a WIP limit goes to show how compatible Scrum and Kanban can be, and how they can be stronger together.

Kanban Canvas v2.0

I’ve just uploaded a new version of my Kanban Canvas which has some minor updates. These changes more closely reflect how I have been using the canvas, and worked well in my recent training in South Africa.

The main difference is in the layout of the Impacts, which are now represented as the corners of a triangle. When identifying impacts, I regularly found that examples didn’t fit neatly into one of the original sections, so this new arrangement makes relative placement more natural. It also now matches the way I previously described making an impact with Kanban Thinking.

In addition, I have tweaked the wording of the Impact prompts from “what stories might be told…” to “what stories can be told…”. This has shifted the emphasis in exploring impacts away from imagining idealised future states and instead towards sharing actual experiences which can be learned from. As a result story-telling can become more natural and Anecdote Circles can be used more easily.

The other small change is in the wording of the Study prompt, which is now “what could be learnt about customer and stakeholder needs, the resultant demand, and how that demand is processed”. Previously it was about “what could be done to learn” but I found it more useful to begin thinking and capturing the potential learning itself, rather than focussing on the mechanism or technique used.

If you have already downloaded the Kanban Canvas, the new version can be found with the same link as the previous version. If you would like to download the new version, you can do so from the Kanban Thinking site. The French translation is also already available, and I hope to be able to update the other translations soon.

 

Strategy Deployment and Playing to Win

Playing to Win” is a book by A.G. Lafley and Roger L. Martin about “How Strategy Really Works” and it describes a model, the Strategic Choice Cascade, developed by the authors at P&G.

This model leads to the following “five strategic questions that create and sustain lasting competitive advantage”:

  1. Have you defined winning, and are you crystal clear about your winning aspiration?
  2. Have you decided where you can play to win (and just as decisively where you will not play)?
  3. Have you determined how, specifically, you will win where you choose to play?
  4. Have you pinpointed and built your core capabilities in such a way that they enable your where-to-play and how-to-win choices?
  5. Do your management systems and key measures support your other four strategic choices?

While there isn’t a direct fit between these questions and my X-Matrix TASTE model, I believe there is enough of an overlap for the model and the questions to be useful.

Lets look at them one by one:

Have you defined winning, and are you crystal clear about your winning aspiration?

Defining winning, and in particular winning aspirations is the most obvious fit with the X-Matrix Aspirations. In fact its possible that my choice of the word aspiration was influenced by Playing to Win. I confess I started reading the book some time ago, but I can’t remember exactly how long!

Have you decided where you can play to win (and just as decisively where you will not play)?

Deciding where to play to win links primarily to the X-Matrix Strategies, especially with Strategy being about decisions and choices, and hence also deciding where not to play.

Have you determined how, specifically, you will win where you choose to play?

The specificity of determining how to win, feels like a link to the X-Matrix Tactics, although I think there is still something strategic about “how” as opposed to “what”.

Have you pinpointed and built your core capabilities in such a way that they enable your where-to-play and how-to-win choices?

Building core capabilities can be considered to be X-Matrix Tactics, especially if we consider determining how to win to be more strategic. On the other hand, I also often describe the development of capabilities as providing X-Matrix Evidence of progress towards Aspirations.

Do your management systems and key measures support your other four strategic choices?

The key measures to support the other choices will also support the X-Matrix elements and correlations, and thus provide Evidence of progress towards Aspirations. Additionally,  the management systems the book describes, emphasising assertive enquiry, closely resembles Catchball and the sort of collaboration I would expect Strategy Deployment to demonstrate.

My conclusion, therefore, is that the approach described in Playing to Win, with its Strategic Choice Cascade (and associated Strategy Logic Flow) can be considered to be another form of Strategy Deployment – a form of organisational improvement in which solutions emerge from the people closest to the problem. The early questions in the cascade focus on the problem, and the later questions focus on the emergence of the solutions.

As a result, when considering Agility as a Strategy, reflect on the above 5 strategic questions for your Agile Transformation to create alignment around how Agile helps you Play to Win?