Once Bill Gates promised Intel that he would deliver a version of Microsoft BASIC in four weeks but failed to deliver it within the agreed time. He was a master coder but lacked management skills.
Intel then employed Andrew Grove to help them improve his management skills. Andrew oversaw Microsoft’s strategy and operations, introducing Microsoft and Bill Gates to the concept of Management by Objectives (MBO), now popularly known as Objectives and Key Results (OKRs).
Microsoft OKRs paved the way for them to become one of the top companies in the world.
Patty Stonesifer, then-CEO of the Gates Foundation, introduced OKRs to the Foundation with the help of John Doerr.
Implementation of OKRs within Microsoft & The Gates Foundation
In 2000, after stepping down as the CEO of Microsoft, Bill and Melinda Gates established the Bill and Melinda Gates Foundation, a start-up worth $20 billion.
This newly created Foundation achieved things that many other long-standing organizations were struggling to achieve. A key question that they asked themselves are
“How do you want to change the world?”.
Then, they placed OKRs as a solution on top as an answer to this question.
Bill and Melinda wanted to set up a disciplined approach that would enable them to achieve the ambitious goals they set. One such achievement was their campaign to eradicate malaria.
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1 The OKRs set by Bill & Melinda Gates Foundation to eradicate Malaria/h3>
In 2016, the Gates Foundation and the British government launched a campaign of $4.3 billion to eradicate malaria.
Objective: Global eradication of malaria by 2040.
- Prove to the world that a radical cure-based approach can lead to regional elimination.
- Prepare for scale-up by creating the necessary tools – SERCAP (Single Exposure Radical Cure and Prophylaxis) Diagnostic.
- Sustain global progress to ensure the environment is conducive to eradication push.
How did Bill Gates benefit from implementing OKRs
Microsoft and The Gates Foundation understood their goals and had an efficient system in place that made them capable of scaling unimaginable heights.
OKRs were a part of this system.
Bill Gates, in the book Measure What Matters, revealed how he was benefited from OKRs. He stated that OKRs raised his confidence and gave him the clarity to make the right decision.
Gates remarked that people often confuse the mission with the objective.
According to him, a mission is directional. An objective is a set of steps or processes to make the mission a reality.
He had clear goals in sight, and with Patty Stonesifer introducing OKRs to the Foundation, he had a clear roadmap to achieve those. He called OKRs, the green-yellow-red approach that worked.
The implementation of OKRs gave the Foundation two things: the freedom to be ambitious and disciplined.
When the data from key results showed that they were not making any actual progress on any of the set objectives, they would re-allocate the capital. Consequently, helping them effectively address the long-standing global issues more successfully than other senior foundations.
Using OKRs on grant reviews made Bill Gates and the Foundation feel good about their vision. They were confident that they were making the right call by observing the data-driven results.
The Foundation has been passionate about learning since the beginning. They derived lessons from their success as well as from their failures.
When they realized that they were not on the right track or measuring the wrong metrics, they always put in the effort to take accountability.
At Microsoft, having directional goals was important. Bill and Melinda Gates knew their goals and were never afraid of taking risks to achieve them.
In ‘The Gates Foundation Story’ in Measure What Matters, Bill mentions two instances where he turned down a grant due to unclear goals. He was confident in his decision because of the OKR system that was in place.
It was an inspiring journey to start and implement OKRs for Bill and Melinda gates.
How has the Gates Foundation addressed some long-standing global challenges?
According to the GLOBAL HEALTH PROGRAM – Bill & Melinda Gates Foundation published by Bill and Melinda Gates Foundation, a young foundation like theirs was no small feat to address and tackle major global issues.
Their global health program includes:
- accelerating the discovery and development of urgent health advances in the form of vaccines
- disease prevention tools
- new drugs and treatment strategies
- improved diagnostics.
These were made possible because of their commitment to learning.
- The Foundation always welcomed outside counsel and inputs on program strategies, grants, and other activities.
- Measuring, monitoring, and evaluating results is and always will be a critical part of their work.
- Being a private foundation, they had the freedom to take risks and set ambitious goals for themselves. Enabling them to alter the course of action when encountered with unexpected results.
After implementing OKRs, they set up quarterly and annual reviews, which helped them plan well and achieve the objectives.
Setting an objective and coming up with an action plan to achieve those goals will make your company good, but only when you truly understand those goals will your company become great.