The startup Echometer: Making agile transformations succeed

Corporates are changing – just read the news around VW, Volvo and the ING bank to name a few. There is a simple reason – accelerating changes in global markets makes corporates’ agility a strategic priority.

Statistics confirm that 50% of german companies have started implementing agile methods and frameworks. But here comes the problem: Roughly ⅔ of such transformations fail.

How is that? Well, according to the “State of Agile” Study 2019, the biggest blocker for successful agile transitions are cultural issues – resistance to change and inadequate management support and sponsorship.

And this is where the startup Echometer comes in. It is a company I met recently as part of my advisor role at the Founders Foundation. As a Spin-off from the psychological department of the University of Münster, the startup has a unique perspective on agile: Focusing on employees and teams mindset. Echometer helps fostering the agile mindset in two ways.

The Founders team of Echometer, currently in the Accelerator program of the Founders Foundation (Bertelsmann Stiftung): Jean Michel Diaz, Robin Roschlau & Christian Heidemeyer.

Firstly, scrum masters and agile coaches, the change agents in such agile transformations, are supported in so called “retrospectives”. Retrospectives are regular team workshops, where teams come together to continuously improve. In these retrospectives, Echometer as a “digital coach” helps developing the team using scientific findings from psychology combined with artificial intelligence.

Echometer helps adopt agile methods in teams (retrospectives) as “digital coach”. As a by-product, the progress of the teams and overall transformation becomes measurable for agile coaches and management.

Secondly, by using the tool in retrospectives, the development of the team and transformation can be made visible – not only on team, but also on organizational level. That way, Echometer ensures that agile transformations become measurable in a way that is combinable with the agile philosophy of self-responsibility. Teams and managers get specific hints and tips about how they can help their teams grow – based on the Echometers learning algorithm in the background.

The Center of excellence of a leading high-end domestic appliances manufacturer has put the use of Echometer this way: 

“We use Echometer to gain transparency about cultural developments and to enable purposeful team discussions.” Source: Echometer

Co-Founder and CEO Jean Michel Diaz adds:

“While many companies have no clue, about how the transformation is going on an operational level, our customers have real-time insights and can be sure that agile teams support the transformation with a buttom-up continuous improvement process (!) – which is even more important.” Source: Echometer

Christian Heidemeyer, organisational psychologist and one of the Co-Founders of Echometer, recently visited the Barcamp of the ING (see picture). While the bank is one of the most popular examples of a corporate implementing agile methods and frameworks company-wide (see McKinsey, 2017), they agreed that agile mindset is a huge field to continuously work on.

Keine alternative Textbeschreibung für dieses Bild vorhanden
Christian Heidemeyer, organisational psychologist and Co-Founder of Echometer, was invited as a guest to present Echometer at the ING Barcamp in January 2020.

Seems like Echometer is heading in the right direction.

If you want to learn more about Echometer, check out www.echometer.de or follow them on LinkedIn, Facebook or Twitter.

Some thoughts on “Measure What Matters”

Business goals are a dangerous animal.

On the one hand necessary for top performance, on the other can lead to increased risk taking, narrow focus, unethical behaviour.

I already blogged about the OKR system employed initially by fast-growth tech companies which implemented it to have a meaningful goal setting process and increase transparency. In that sense reading “Measure what matters” by John Doerr added a whole new dimension to my understanding and linked theory with some real-life examples and learnings.

I have put toghether my take aways in the hope that they can help others in implementing OKRs. I strongly recommend that you read the book as it is by far the best I could find on the topic.

OKR requires commitment and time

  • OKRs are a tool, not a weapon – do not use them to force on people.
  • Dare to fail – won’t work out in the beginning and probably never gonna be perfect.
  • Be patient: it takes at least some quarters to get it going.

Implementing OKR the right way

  • Ask the question: what is most important for the next 3 months, where should we concentrate our efforts?
  • Set hard goals as they drive performance more effectively than easy ones. Specific hard goals yield better output than easy ones.
  • Less is more – better have a few but well chosen objectives.
  • Set goals from the bottom up – about half of the goals should come from employees.
  • Collective agreement is essential for getting buy-in from colleagues and subordinates as no dictating is allowed.
  • An OKR can be modified or scrapped at any point in time, sometimes it takes months in the process until the right key results are identified.
  • Pairing OKRs – pairing quantity and quality results in getting key results better aligned with value creation e.g. Sales of 50M + Maintenance contracts of 10M.
  • OKR for new features could be tied to a deadline till data is available and results can be quantified.
  • Having cascading in OKRs allow employees to see the objectives up to the top management and clarifies how the objectives of employees down the hierarchy contribute to the mission of the business.
  • Implementing OKRS requires the whole organization to participate – no opt-outs are allowed. In order to ensure that one or two shepherds can be designated (e.g. for some years this task at Google was done by its SVP Jonathan Rosenberg).
  • Commited vs. aspirational goals – committed are generally goals such as revenue, users, bookings that are to be achieved in full. Aspirational are on the other side dare and future looking but with a high risk of failure.

OKR alone is not enough, you also need CFR

The introduction of OKR requires a change in HR practices where annual reviews are the standard. The alternative to annual reviews is called continuous performance management. Its tool is CFR – Conversations, Feedback, Recognition.

  • Conversations stands for regular and open exchanges between a manager and contributor.
  • Feedback: provided among peers in order to track progress and future improvements
  • Recognition: is given in 1:1 to deserving individuals for  their contribution

Interesting point around CFR is that it is decoupled from compensation unlike with annual reviews (for most companies).

CFR foresees a semiannual professional development conversation where discussion is around career trajectory.

In sum, the old practice which still rules in many companies sees goals, compensation and performance management to be tightly intertwined. The new model engages a different view, namely that 1) OKR, 2) CFR and 3) Compensation & Evaluation are separate areas with a bit of overlap.

“Culture eats strategy for breakfast”

Once said … Peter Drucker.

You get leaps in productivity when stretch for amazing. A typical example is the Google’s 10x rule whereas incremental OKRs are being replaced with exponential ones.

OKRs are usually marked with red (behind plan), green (going well) and yellow (somewhere in between). Companies often have particular strategies how to deal with tracking OKRs. They remove the yellow/orange and mark the ones in danger as red. At OKR reviews they concentrate only on the reds and discuss which objective is most important therefore should get extra attention and eventually resources. This is known as „selling the reds“.

This is what a typical OKR cycle looks like

  • Define annual OKRs and Q1 e.g start in November practically several weeks ahead of Q1.
  • Announce company-wide OKRs for the year and Q1 and e.g. mid-December.
  • Announce team Q1 OKRs – the team develops their own OKRs and shares them in meetings e.g. at the beginning of January.
  • Provide employee Q1 OKRs e.g. end of first week of January.
  • As the quarter goes, OKRs are being tracked and toward end of Q1 also being scored. In the mean time about 6 weeks before next quarter starts the brainstorming of company-wide OKRs for Q2 and the cycle repeats.

If you want to get systematized and proven guide into the world of OKRs I cannot emphasize enough the importance of laying your hands on “Measure what matters” by John Doerr. I consider it a must have in every library and will be happy to hear some funny stories from your experience.

When is the last time you reflected on motivation and how to build lasting perfomance in your team?

Over the last years I have repeatedly encountered 3 words defining the current notion for motivation: 1. Autonomy, 2. Mastery, 3. Purpose. This notion has often appeared in presentations about tech culture, notably at Zalando (thanks Eric Bowman) but also often emerges in company cultures such as the one at Solvemate (thanks Christian Blomberg).

So I carried the notion with me till I felt urgency to go beyound the simple words. Ultimately I landed at presumably the source of it: the book “Drive” by Daniel Pink.

Without telling you too much and spoiling the read here are some of my takeaways for motivation:

  • Motivation 2.0 in the form of carrot and stick (rewards based) is inefficient and unpredicatable.
  • Motivation 3.0 defined by the 3 aforementioned words offers the ruleset for maintaining performance and job satisfaction of a present day person.
    • Meaning of Autonomy – to hold your life/job with your hands and direct it the way you deem necessary.
    • Meaning of Mastery – to constantly learn and improve on a subject that matters.
    • Meaning of Purpose – to dedicate to something bigger than our own self.
  • Motivation 3.0 seems to almost always outeprform Motivation 2.0. Even in the short term.
  • FedEx days at Atlassian. Nowadays called ShipIt this is a day long retreat for evey engineer in the company to create a new solution or fix something that annoys them. Execution matters but best idea wins.
  • The concept of ROWE – results only work environment, or else said no time keeping (check in/out).
  • Super clear and stripped down to the basics insights from Jim Collins (by the way also a great author) about self-motivation – 4 simple rules how to instigate such culture.

On the matter of ROWE quite curious how many companies run this model, it seems to be getting good traction in creative industries. Yet, wondering whether teams do not alienated by not spending time together.

Anyway, I highly recommend this book and plan to revert to it from time to time. Have you read it and what do you think?

IdeaFox – an innovation management platform for teams to co-create and implement solutions

In the process of building new digital business models I often revert to the business canvas template and generate a ton of MS Word/Excel docs and series of email threads in that process.

IdeaFox seems to deal with all that. I knew about the platform quite some years ago but got to lay my hands on it just recently (should have done earlier though). It has managed to put away most of the aforementioned overboard and gave quite an orderly look to my creative chaos.

IdeaFox is cloud based and covers all steps from collective ideation, co-creation and evaluation, to idea realization. It is simple and easy to use platform. I started a new project within minutes and is quite intuitive (whoever knows me, would sigh how rarely I actually say this).

But just in case you need a tutorial, here is one.

It can actually do more than I do with it. IdeaFox allows idea challenges, idea realization in a stage gate processes, or collection of best practices.

Typical users seems to be innovation and digitization teams (like I am), but also teams collecting ideas for operational improvements.

In sum, IdeaFox solves three needs of organizations that want to get better:

  • Get better solutions by efficiently connecting a broad group of participants
  • Improve realization of ideas and get up to 20% quicker (claim by IdeaFox)
  • Increase employee engagement and foster transparent communication

I also tend to know the two lovely people behind the platform so this is yet another argument for me to give IdeaFox a try if you need such a platform.

Meet Dörte and Aron

Looking forward to your feedback and please share your impressions.

If you want to learn more about IdeaFox, check out ideafox.io or follow them on LinkedIn or FB.

You can find the rest of my articles either on LinkedIn or on my website: https://starkfounders.com. Enjoy!

How technology champs set goals – the power of OKRs

I find it increasingly challenging to stay aligned with the company and team goals of a modern business organization. The reason is simple, I believe we live in super fast paced times and it has become imperative for a business to make swift turns on its path to success. This is why OKR seems to be an excellent (and proven) system to align and quickly adapt to change while at the same time measuring results.

OKR is an abbreviation for Objective & Key Result. The concept comes initially from Intel Corporation and is well known for being used amongst the biggest technology companies like Google and Uber.

OKRs are meant to set strategy and goals over a specified amount of time for an organization, teams and individuals.

At the end of a set period, the OKRs provide a reference to evaluate how each piece of the organization did in executing the objectives.

If you have an hour and half I recommend to watch Rick Klau’s video on the topic. If you don’t, take a look at my notes on the topic. Credit goes to Rick but there is plenty of examples and resources on the topic.

Rick Klau about OKRs at Google

The OKR starter hints:

  • Works well if OKRs are publicly available to the entire company.
  • Do not turn them into performance evaluation.
  • Set, reviewed, and revised quarterly (and annually).
  • Initiated or at least supported by the management.
  • Try to do with ready tools. There are plenty of them e.g. Perdoo (Made in Berlin), BetterWorks, 7geese.

Objectives (the WHAT you want to achieve):

  • Cannot exceed 5 in total.
  • Must be strategic.
  • Not necessarily measurable (e.g. grow profit margins).
  • Should cascade – relate to the OKRs one level up and same time to what the individual wants to work on.
  • Mostly (60%) set by the individual.
  • Should get a score.

Key results (the HOW you know you have achieved your objective):

  • Must be measurable (e.g. launch a new feature; reduce defects by x%).
  • Should be hard to achieve so there is a substantial effort.
  • Are graded quarterly (should average 0.6 or 0.7 so it is fairly hard to get 1; 0.4 or below is bad, but a learning opportunity, not a failure)
  • Max. 4 key results per objective

Jason Carlin summed it up quite well:

The most useful thing I was ever told about writing effective OKRs is “Key Results must describe outcomes, not activities. If your KRs include words like ‘analyze’, ‘help’, ‘participate’, they’re describing activities. Instead, describe the end-user impact of these activities. ‘Publish latency measurements from ADR ad serving study by March 7th; is better than ‘assess ADR latency’.”

If you want to see further example OKRs just go to 00:07:36 and 00:36:32 of Rick’s video.

As said there is plenty being said about the topic. If you are sensitive on your spend, try to work out your OKRs using tools like the Startup OKR template. For established businesses I would recommend getting a coach and a good tool to get you started (Perdoo, BetterWorks).