Top-down vs bottom-up in planning

Leveraging both in an M-shaped approach.

The Coda Team

Top-down vs bottom-up in planning

By The Coda Team

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Blog > OKRs
Planning cycles. You’ve been through dozens of them, and they are messy and challenging—every time. You still work on your annual plan three months into the year. Or you rush a half-baked plan through approval, only to abandon it after only five months. OKRs slip through the cracks and buy-in becomes tougher on the next cycle. Having an efficient and effective planning cycle is a tricky balancing act. And while striking this equilibrium in the planning cycle duration is huge, a hard truth is that planning output is only as good as the process by which you create it. Oliver Heckmann, our Head of Engineering, studied how customers set up their planning process using Coda and shared his learnings in the Ultimate Handbook for Planning and OKRs. And when it comes to optimizing the planning process, he saw that the most successful teams lean on M-shaped planning, which integrates both top-down and bottom-up.

What is top-down planning?

 Top-down planning is when leadership clarifies what they want to accomplish over the next quarter. In the planning sequence, it’s critical to provide top-down guidance first so that guardrails are in place for the subsequent bottom-up planning phase. When dialing in the top-down planning, make sure your message is clear and centralized. In Coda’s experience, that guidance should be clear and centralized. Ours live in a writeup located in a centralized planning doc. It’s critical that everyone can access it, so that your teams can easily reference it during the next phase of the M-shaped approach: bottom-up planning.

What is bottom-up planning?

 The bottom-up planning phase is when the full creative energy of the entire company is unleashed. If done right, this creates solutions to both the problems outlined in the top-down guidance phase and some that even leadership might not be aware of. Bottom-up planning takes time and, more importantly, focus. If your team members are expected to propose creative solutions in addition to their typical day-to-day, you will not get the most out of planning. Instead, we think you should use the golden rule: spend only 10% of your time planning, leaving 90% of your time for execution. This keeps the overall planning process very short, so you can afford to pause normal operations for two or three days while allowing everyone to fully fixate on bottom-up planning.

M-shaped planning: Merging top-down + bottom-up.

 M-shaped planning is built to merge top-down guidance with bottom-up planning processes. Simply doing one after the other won’t automatically produce better planning—there are additional steps needed to ensure that your process is getting the best of both worlds.
Good planning processes often follow an M-shaped pattern, as the information flow switches from bottom-up, to top-down, and back up, repeating as necessary. The phases are:

1. Reflections on the previous quarter.

 The goal of the reflection phase is to look back on the last quarter to better understand what worked well and what lessons there are to learn for the forward plan. We recommend two approaches for quarterly reviews:
  • Give all OKRs their final (progress) score. These grades are important for informing any sort of re-calibration of goal planning for the upcoming quarter.
  • Use an interactive doc, like a two-way writeup, that can be read asynchronously. This has the nice bonus of documenting all of your lessons learned for future reference. Our companion tutorial doc will also show how to do this in Coda.

2. Top-down guidance from the leadership.

 In this phase, leadership clarifies what they want to accomplish over the next quarter. We recommend that top-down guidance always be given before bottom-up planning. Setting your teams up for success starts with efficient decision-making among the leadership team. There are different ways to support this, like gamestorming. For this phase, we love using the $100 dollar voting exercise, since it helps determine priorities in an environment with scarce resources.

3. Bottom-up planning that taps into the full strength of the team.

 The bottom-up planning phase is the most exciting and chaotic: the creative energy of the entire company is unleashed to create solutions. If your teams struggle with this, we recommend creating a team hub where you can add ideas throughout the quarter, maintain a running backlog of issues, and store customer feedback so you don’t spend days tracking down lost documents.

4. Integration that merges top-down guidance and bottom-up plans.

 In our experience, bottom-up planning typically ends with teams being overcommitted. It’s not uncommon for teams to be overwhelmed with top-down asks from leadership, dependencies from other teams, and tasks from their own roadmap. The integration phase reconciles bottom-up plans with top-down guidance, which helps teams prioritize their KRs while keeping commitments grounded and realistic. The integration phase is full of hard decisions, which can be stressful. This is particularly so for team and department leads, who have to work through numerous issues in a short period of time. Here are our recommendations to make the integration phase as smooth as possible for you and your teams:
  • The leadership team needs to make themselves available to quickly resolve any prioritization conflicts.
  • Use Bullpen-style meetings to work through many issues efficiently in parallel without creating calendar nightmares.
  • Throughout your planning, make tracking and acknowledging dependencies a priority.

5. A final presentation that brings it all together.

 Planning should have a defined end-point at which planning ends and execution begins. At Coda, we are big proponents of having each team present their plans. This allows everyone to get on the same page, ask questions, and rally together as the team enters the new execution period. To maintain clear communications, we recommend the following for your final presentations:
  • Strive for short presentations. At Coda, we restrict each team’s time to 5 minutes, plus 3 minutes for Q&A moderated by a Dory.
  • Teams should focus on the what and the why. One cheat code is to use pre-recorded presentations to make sure they are on time and re-watchable later on.
  • Streamline the final presentation production by keeping your writeups, data visualizations, mockups, and more in your planning doc throughout the previous phases. Keeping everything in one place makes it easier to pull your final presentation together.
For more on how to run the final OKR presentation efficiently, check out our tutorial in Coda Tutorial for Planning & OKRs.

Top 3 planning pitfalls to avoid.

 M-shaped planning provides a lot of structure for optimizing your planning process. However, there are some pitfalls you can slip into even with the sturdiest of guardrails. Stay away from these “anti-patterns” to keep your planning away from danger:
  1. Don’t define and outline the different phases of the planning process. This leads to org-wide confusion on how planning is conducted, where they are in the process, and what is expected of each person.
  2. Don’t have hard (or realistic) deadlines for the different phases. This leads to teams spending too much time in one phase, then speeding through the others to make up for lost time.
  3. Leadership doesn’t implement an integration phase. They connect their top-down guidance with the bottom-up plans of individual teams. Or, if the phase takes too long, confusion generates over what’s been prioritized and what’s been cut.
In all these cases, sticking to structure helps keep teams aligned and focused. The more efficient the planning phase is, the faster your teams can get back to what matters: execution.

The best of both worlds: Using Coda to combine top-down and bottom-up planning.

 The success of planning is based on the execution that follows. Coda can help optimize your planning using the M-shape process, along with several other functions.
Learn more in Coda Tutorial for Planning & OKRs

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