How Google sets goals and measures success
Google sets impossible bodacious goals…and then achieves them. The engineering mindset of solving the impossible problem is part of the culture instilled in every group at Google. Tough engineering problems don’t have obvious answers. You need to invent the solution, not just optimize something that exists. Every quarter every group at Google sets goals, called OKRs, for the next 90 days. Most big companies set annual goals like improving or growing something by x%, and then measure performance once a year. At Google a year is like a decade. Annual goals aren’t good enough. Set quarterly goals, set them at impossible levels, and then figure out how to achieve them. Measure progress every quarter and reward outstanding achievement.
OKRs are Objectives and Key Results. I submitted my Q1 OKRs with what I thought were aggressive yet achievable goals. Not good enough. My manager explained that we needed to set stretch goals that seemed impossible to fully achieve. Hmmm…I said “This is just a 90 day window and we can predict with reasonable accuracy what is achievable. Why set unrealistic goals?” Because you can’t achieve amazing results by setting modest targets. We want amazing results. We want to tackle the impossible.
Failure is not an option – A while ago I wrote a post about the culture of “failure is not an option” and how, taken the wrong way, that actually conditions people to set modest achievable goals that they are certain they can achieve. Because if they fail…they are fired. Taking great risks, pushing innovation, and striving to achieve the impossible will never happen at companies like that. In that post I discuss how startups definition of “failure is not an option” is completely different. For startups it means they will try 5 or 10 or 20 approaches until they find one that works. They won’t stop until they succeed. Google’s culture seems to follow the Thomas Edison approach which paraphrased is “I haven’t failed, I’ve just found lots of approaches that don’t work, and I am closer to the solution”.
Achieving 65% of the impossible is better than 100% of the ordinary – Setting impossible goals and achieving part of them sets you on a completely different path than the safe route. Sometimes you can achieve the impossible in a quarter, but even when you don’t, you are on a fast track to achieving it soon. Measuring success every quarter allows for mid course corrections and setting higher goals for the next quarter.
Rewards For Success – The rewards for achieving the impossible are significant. As you might expect there is an algorithm for calculating engineering bonuses with various multipliers. Google attracts the best people in the industry for many reasons, maybe most importantly because they give people the resources and support they need to achieve the impossible. Financial rewards are significant, but they are not the primary motivator. Working with the best people in the world and achieving greatness is the ultimate reward.
To use a sports analogy, do you think Peyton Manning or Kobe Bryant are motivated by money? No, they earned more money than they could possibly spend years ago. They are driven by the desire to be the best in the world. That desire and drive is far more powerful than any amount of money. That same drive and desire is evident all across Google.
Startup entrepreneurs are driven by similar desires. To achieve the impossible. To create something from nothing. To attract the best team. And, to make a difference. In many ways Google is still a startup, with the founders still working hard every day to achieve the impossible. Every company has a process for setting goals, measuring success, and calculating rewards. It is not that Google’s process is significantly better…it is the mindset and culture that is totally different. There is an energy force field that you can feel when you are surrounded by top achievers. It is exhilarating, and inspires you to achieve more than you thought possible. It feels good!