The birth of OKRs can be traced back to Peter Drucker, one of the first managerial thinkers, who, in the 1950s introduced a system called “Management by Objectives” (MBOs) that called for setting objectives for everyone who works in a company. These goals had to “lay out what contributions a given individual and their unit are expected to make to help other units obtain their objectives.”
Andy Grove, CEO of Intel, reshaped the MBO system into a simpler form that answers the questions:
- Where do I want to go?
- How will I pace myself to get there?
He also suggested objectives should be set more frequently, on a quarterly or monthly basis, as the fast-paced world requires constant feedback. He also believed multiple performance management tools should be used in conjunction with OKRs. Finally, he believed OKRs should be stretch goals and achieving them 100 percent should be next to impossible. Having gotten a lot of leadership lessons from Grove, John Doerr introduced the system to Larry Page and Sergey Brin, co-founders of Google.