The Secret to Empowering Leadership

Quantive CEO Ivan Osmak opens up about the past, present, and future of OKRs, empowering leadership, hypergrowth, and that multiverse article he wrote.

Take me from Point A to Point B. First, what moment pops into your mind when I ask, “What catalyzed your vision for Quantive?”

It was several things. One of the big trends we saw back in the day is that computers and the agile way of working was overtaking the engineering software organizations. That was before 2015, and probably from 2000 on. We saw that it was going to spread to the rest of the organizations, be it sales or marketing, and began looking at that. We saw that there was going to be a need for a new way of working. Otherwise, planning even 1-3 years ahead was not going to be possible.

The second thing was the shift from on-premise software, say Microsoft Shop or IBM, to B2B solutions in SaaS. We saw it happening and it created a lot of barriers and opportunities. One big problem: it was very hard to get a single source of truth.

It was those two things combined: the need to work faster, be agile, and change course much more rapidly along with organizations using 100, 200, maybe 300 systems. It looked like a problem, but every problem is an opportunity. So, that’s how we got into OKRs.

At what point did others become involved? Was it natural?

Right from the beginning. At no point was it just me. It started very much as a classic startup. The company started with the co-founders and after one year, we were 6 or 7 people.

I worked in our previous company with Rado (Georgiev) and Jordan (Angelov). And then Bo (Pedersen) was kind of an accidental or serendipitous connection, because he worked in a company I also worked for, but with a 10 year difference. He worked there 10 years before. But we shared the same manager/CTO of that company, who put us in touch.

In the beginning, we were exploring possibilities to invest, but as we kept talking for about a year, it just became clear to me that we could probably do much better if he joined Quantive. We had a pretty long walk next to the Thames, ordered some beers and shook hands in about five minutes.

How were you feeling as you moved forward in the process? Can you describe a high point?

One of the things we had going for us, we all had careers before that. I would say we were middle-aged. So, we had seen things before and we’d seen both the good and the bad, which helped with any mood swings. A startup has two modes: shit and euphoria, usually nothing in between.

I would say it wasn’t one of those epic stories where it was all bad and we persevered. It was work, it was a lot of work, it still is. But I think the fact that basically all four of us weren’t in our 20's anymore… It grounds you very much, so you cannot really bounce off the walls anymore. So we were very determined to do the work. All of us have seen both failures and successes before, and we knew the main ingredient of success is just to keep going and not give up. So, that is how I would describe the feeling.

We knew the main ingredient of success is just to keep going and not give up.

Another thing was, we almost accidentally became a support group of sorts, so at any given moment, if someone felt bad, someone else was there to pick you up. And to be honest, I don’t know how people do this alone, without co-founders.

It wasn’t crazy dramatic, I wouldn’t say it was, but it was a lot of fun, a lot of things were being done for the first time, a lot of pushing the envelope and seeing how far we could go with something. So yeah. I would never do it again, but I’m really glad we have done it.

So this is your last startup.

Yes, absolutely.

Tell me about a “shit hits the fan” moment you’ve encountered and how OKRs helped you.

There was a lot of shit hitting a lot of fans. And as you said, I think OKRs did help a lot because they kept us focused, especially in the early days. I think it's really easy to fall prey to busy work. To do something just to keep your mind on, because you don't want to deal with things that are bad or hard. So, I think the typical thing for almost every CEO of a startup venture to do is take a few days to reorganize Confluence because it makes you feel kind of good. You're doing something, it's easy. I think we all tell ourselves these lies. It’s like when you're in college and have an exam and decide you have to do the dishes.

OKRs simplified the problems always. It was never easy to come up with OKRs, it still isn’t to this day, but once you set them, even if there are 300 other fires and 300 other things to be done, you know that right now we’re only going up this street. It focuses you. As a result of focus, I think you get a bit of peace of mind.

Once you achieve what you’re doing, it gives you energy and fuel to go into the next quarter, or month, or whatever it is, because you’ve seen it works. You’ve seen the results. And even though at the time they may be minuscule, and they may not be financial results, you're moving things, you're progressing.

I can remember our first customer, who had 300 users, and we didn't have a way of doing single sign-on so we were all waiting at the computer and whenever anyone tried to log in, there was a script we would write for 300 people. It was one of those magic behind-the-curtain moments.

I think probably when we hit 100 employees, that was a moment when we really everything was starting to break apart and we had to form an HR department. It used to be our thinking that we’d never have HR, we actually have this hashtag #NoHR, so yeah. A lot of moments like that, I’d say. Nothing really horrible happened, but those are some moments that stick in my mind.

Did you have any self-limiting beliefs that OKRs helped you overcome?

I don’t think so. I have been called arrogant, even though I don’t believe I am. But maybe it comes from the fact that I don’t have any self-limiting beliefs. I don't think I'm delusional, but I think you can work on anything, towards anything. Many things can be achieved in one way or another.

OKRs are really just a way of keeping you honest about this. And keeping you focused. For example, for myself, my OKRs are public and available for everyone to see. Whenever I put in an OKR, you can go and find it. So everyone sees that. It could be a very good round, but I could fail it. You don't want to hear 30 people telling you no, this is what's bad, this is what needs to be fixed and things like that. The temptation to stop doing it, it’s awful, it punches your confidence constantly.

But then, you know, you've said this in front of a team, everyone sees it, and if nothing else, you keep doing it mostly because you said you were gonna do it. It’s this kind of forcing function or public commitment. So I think OKRs really help when you’re doing something that you probably don’t want to do, when you’re achieving something that is maybe not so creative. I think a lot of people like creative work, at least I do. But doing something that is uncomfortable can affect your picture of yourself.

When you commit in front of the whole company, it makes it almost impossible to drop it. And you can always find some more strength, self-esteem, and confidence in your deepest reserves of your being to go one more round, and then to go another one, and it worked. It did.

Do you see Quantive as unified communication and collaboration solution?

No, I don't. You could kind of stretch that definition to fit almost anything you want to say, but I wouldn't say it's some kind of communications system. The way we’re building Quantive and rolling it out, in short, it's a system for achieving success.

And I know it sounds a bit banal or is an infomercial kind of way to talk about it, but I think what everyone in our industry today, us included, is focusing on a lot is setting and tracking goals, which is very low ambition. It's all about, let's make it a bit easier, prettier, this and that.

But what drives me, and why I have dedicated six years of my life to doing this and will probably dedicate another 10, is that we need to build a system that helps people achieve their goals, not just to set and track. Because it's not worth 15 years of your life otherwise.

There are parts of communication here. Because you need to communicate your goals to be successful and get allies, and other people to help you, and all this. But it's really about helping people and companies achieve their goals and get results.

Here's a simple getting-to-know-you question. Do you believe that there is an architecture to how nature unfolds in our universe?

I definitely think there is an architecture to it. It's one of those philosophical questions that we could all interpret in any number of ways. I’m not sure if you are thinking about intelligent design or religion, or just simply architecture. But I think science is always the framework for this architecture.

We’re starting to understand more and more that things are predictable. Me and my 8-year-old daughter just bought a set for growing crystals and it's pretty mind-blowing. I think that we are both equally impressed with how this works. That you can just go to a store and make something and then things start appearing. But it definitely brings up architecture, because you can buy 6-packs of this, and unless you mix up your ratios of salt and water every single time, it's going to grow just the same. So yeah, I think there's an architecture, a system.

But I do also think a big part of the architecture and the system is some kind of random generator which, from time to time, on purpose, creates some mess that we can either fix or enjoy.

In OKRs, what is a meta-objective?

We have this OKR that we call Kill it with OKRs. We’ve had it for a very long time now. Especially with the early-stage startup years, the only OKR that a CEO might own is for others to fix their OKRs because then everything fits into place. That’s the meta-OKR.

I’d say it’s nothing new. Everyone will say their job is empowering leadership, and this is just a way to quantify that. If only I am successful and everyone else isn’t, then I actually wouldn’t be successful and the company wouldn’t exist. It’s much better if the company is successful, and then I am successful. That works much better.

If OKRs exist in the multiverse, do you see them reconciling these different realities somehow? Maybe through alignment?

I see you read my blog post, which I wrote one rainy evening in Berlin in 2017. I think it’s human nature to seek everything to be very simple and elegant, but I think the world always opts for messy, for asymmetrical, for irregular.

And if you take companies--for example, a software organization is very different from a marketing organization. They operate in different ways. One may also be more successful than the other, or bigger, with a bigger budget. All those things are normal and I don’t think there’s a need to reconcile this in any way, to use your word. But it doesn’t mean you should ignore their coexistence or the basic properties they have.

To really extend the analogy, for everything to work, for the company itself to work, you need to have time travelers. You need to have people who are able to move from one universe to another. And you need to have wormholes and I think these wormholes are either shared OKRs or some higher-level OKRs, which gives someone a mandate to jump from marketing to engineering, to see what’s going on and align and vice versa.

If you’re working in a sufficiently large organization, it becomes quite obvious that people don’t know about each other. If you work in a company of 50 or 60 thousand people, you cannot name all the offices, let alone all the people. And that’s fine, there are some people you do know and some intelligent architecture to it. But I like the idea of the multiverse. If nothing else, it’s very entertaining. There is almost no proof for it but it sounds cool.

In 2018, you wrote a post about Mary Parker Follett, who has been called the Prophet of Management. She said, “Leadership is not defined by the exercise of power but by the capacity to increase the sense of power among those led.” Can you talk a little more about what empowering leadership means to you?

Quite a few different things. What really resonated with me from her ideas, because she wrote a lot, is this idea I think of as the official authority and unofficial authority, or given and earned authority. I’m repeating what I’ve been working on for close to 20 years now, which is that no one can really give you authority.

Anyone can make you a VP or CEO or executive, but no one is really going to be able to follow it up without this earned authority. At the same time, we all know these people who have no title, or no one really knows their title, but they’re in every single meeting, they’re the people everyone confides to or asks advice from. So, the great eminence of earned authority is that it’s often greater than the official one.

What she was thinking about when she talked about empowering leadership and the authority of leaders, it’s very important, depending on who reports to you. For example, for me, it’s usually executives who report to me. Then the job is not only to empower them but to empower them to empower other people.

Our authority is aligned with integrity. Yes, you have to be good at something, exceptional at something, it may be programming, it may be writing, it may be public speaking, but then if you really want to take it to the next level and do big things, you need to have integrity.

And integrity comes about in so many different ways. We tend to define it as doing the right thing even if no one’s looking, but it also exists in every single decision. If you’re not trusting people, if you make a mistake and throw someone under the bus, or someone does something you take credit for, all of these are very quick ways of having a very short career.

The opposite is true as well. Multiply it by minus one, and you get how to have a successful career. When someone makes a mistake, you take the responsibility. If they are on your team and you do something good, you credit your team, mostly because it’s almost always true. 

One thing I remember is that the best people I’ve ever seen, the people I’ve recruited like mad, are people who are producing new leaders. Our Chief of Engineering, we worked together, he was a team lead of six people, and twice a year he would produce a new senior developer. It almost didn’t matter who we gave to him. And that’s such a high standard of empowering leadership that you’re basically producing people who are going to be new team leads, people who will be the new VPs.

That, for me, is the highest standard we should all aim for. It doesn’t matter where we are, because ultimately his success back then, even today, is not about the fact that he’s the smartest person in the room. Coincidentally, he almost always is, but it’s really about how many smart and successful people that come up because they’re hanging out with you, because they know you.

Going back to Mary Parker Follett, I think that’s what she was thinking when she said that. The other obvious thing is that her being 20th-century and me learning about her in 2018, she basically laid the grounds for everything that anyone who became famous now would ever do, so I find that really kind of interesting.

How do you see OKRs as benefiting businesses that are looking to merge stability with hypergrowth?

I don’t think stability and hypergrowth go together.

I have this theory I developed some time ago. When the 737 Boeing Max went down, I think we were all reading about it, but I read this quote that basically said civil aircraft are designed to be statically stable. Meaning that they return to their original position when disturbed. And I was like okay, that makes a lot of sense, that’s probably how it should be. But then, they said the fighter jets are actually designed to be statically unstable, and I thought, that’s fun. The reason they are designed this way is because it gives them a much bigger ability to make dogfighting maneuvers and stuff like this.

It got me thinking that that’s basically the difference between startups and corporations. Established corporations are basically designed for stability, they’re designed for nothing really to go wrong. And then startups are designed more like fighter jets. You design them on purpose to be statically unstable. Having that in mind, I don’t think you can marry hypergrowth and stability because hypergrowth literally means instability.

We have hired 120 people since the beginning of the year. We were 80 when the year ended. And now 100 people more just in Q4. There’s no way this can be stable, literally no way. And I think you have to accept that if you are going to do hypergrowth, you are not going to be stable, and that’s fine, just as fighter jets are fine. But you’re not gonna go to your summer vacation on a fighter jet, if you’re not trained you’ll probably puke your brains out. A jetliner won’t do a U-turn, but you can have a nice gin and tonic, and it’s not too loud.

Going back to OKRs, I think you have to choose stability or hypergrowth and set up your OKRs to pursue that.

But what about the ‘static’ part? Doesn’t there need to be some underlying thing that keeps the fighter jet functioning?

I would say that’s consistency. So you can be consistent about instability. When I hear the word stability, it sounds stale, a little boring. We have talked so many times about how one of our biggest fears is groupthink in Quantive. We have, the co-founders, we have this saying, time to stir some shit up. The moment we feel everything is comfortable because we are afraid of complacency. So we were very consistent in pursuing instability and have been for years now.

How does transparency affect clarity and why does it matter?

Transparency has an influence on clarity, but they aren’t necessarily the same. You can have a bunch of numbers, but if you don’t know what they mean, it doesn’t lead to clarity.

And then there is another thing. If you are a fan of the cop movies from the 80s, the way they would deal a lot of times with going to court is, they would send boxes and boxes of papers and documents to someone else just to hide one single paper. So a lot of transparency can lead to a lack of clarity if used for evil purposes.

What I think transparency really brings to the table is trust, and that’s paramount in doing anything together, from having a relationship to building a multi-million dollar company. It boils down to the same thing.

Today at Quantive, everyone can literally see any piece of data they want to see about the company. That leads to all kinds of questions, which is good. Transparency allows for people to question decisions and direction. It also creates trust, because if we had, say, a bad quarter and then after that a good quarter, people have seen it and know it can go both ways. It calms the panic.

We are most afraid of things we don’t know. Bad news, good news, but things we don’t know always scare us the most. Going back to clarity, I think transparency helps people pursue clarity. They may see we are growing at 15% every month and ask someone to please explain why. So it leaves room for questions because you have some base level of information. I don’t think transparency alone is enough for clarity, but it goes a long way towards achieving it.

What’s one of the biggest challenges or opportunities you’re faced with now, and how do you see OKRs coming into play?

There are probably a few things I want to mention. One is, similarly to when everything is bad when everything is good, people tend to lose focus. When everything is bad, we try doing a Hail Mary pass and find an idea that will solve everything by trying 100 different things. But when everything is good, it can breed a bit of arrogance, a Jesus Christ syndrome where you cannot do anything wrong.

So I think OKRs keep us grounded towards knowing where we need to go next, help us avoid maybe some random investments that we could take now but don’t contribute to our end goal. I think that’s the struggle. Another challenge we also have right now is, with so many new people coming, there are so many new ideas, which is a big part of why we are bringing all these people in, but we cannot have so many new goals. The direction has to stay the same and I think OKRs help here a lot.

Every challenge is an opportunity, every struggle. Any company that manages to be laser-focused on whatever it is, whether it’s developing the right product, pursuing the right markets, recruiting the right people, they will have a huge competitive advantage. We are today just over 200 people. There are 20 teams of 10 people pursuing their own things. What it really means is that it’s acting as 20 small companies, so you can grow, you can explore. The benefits of scale. People like you, three years ago, I was writing all the blog posts and now you’re interviewing me. The only way to benefit from scale and from a lot of different talent is to somehow manage to channel all that talent, all that effort, all that passion into a roughly same direction. Which people call alignment, but I don’t like that word.

What challenges or opportunities do you see looming in the future? How do you see OKRs coming into play there?

The challenges will probably be difficult, but the answer again is that you have to focus. You have to get people excited about whatever the game plan is, whatever the challenge is. We all need to identify specific issues, but ultimately we all need to come together. Whatever the challenges of the future will be, I know the solution will be for all of us to put our heads together, persevere and solve them.

A poetry question for you. (So, permission to respond with nonsense.) What is the core or magnet at the center of Quantive that resonates with you?

(Ivan takes a moment to think.)

If I have to choose one word to explain, I would use unreasonable. If you spend a little more time at Quantive, you’ll figure this out. Everything they’ve been doing since the beginning, we’ve purposefully tried to be unreasonable about everything.

When I say unreasonable, it’s kind of a funny word. Anything can be made reasonable and rational but different than whatever makes you comfortable. I used to say I’m only comfortable when I’m uncomfortable. And I think that attracts a group of people who are kind of a subset, it doesn’t attract all the people, but it does attract the smart ones.

Just the fact of starting a startup for OKRs, which literally no one knew what it was, let alone thought it was going to be a company right. We went to the United States and the way we did that was not in a reasonable way. We were ignoring all of the common-sense advice, not just to be different, but to question everything.

The motivation for being unreasonable is that… we had this talk, the four of us. We were sitting at this table saying that if you want to do something unusual, or something that is not normal--and building a 25 billion-dollar company, which is still our goal, is not a normal thing--you cannot take conventional measures to get there. By definition, that would take you to a conventional outcome.

So trying to be unreasonable about everything was really the core of the culture. And I have to say, it’s fun to be unreasonable and sometimes we have to check, are we doing it because it’s unreasonable or because we think it’s a better way? Sometimes it’s the pure entertainment value of being unreasonable.

The best thing is when someone tells you, that’s completely unreasonable. We’ve loved that from day one.

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