Getting OKRs right is difficult. Although simple in construct, OKRs require commitment, discipline and have wide ranging and transformative ramifications at every level of the organization. Below are some of the many ways OKRs can go wrong.
Setting poor top level objectives. It’s easy to come up with a long list of things to do. The challenge for most organizations is to focus on what will have the biggest positive impact. Use good, old SWOT, Porter’s Five Forces, or whatever helps you identify what matters most for you. Yes, one of your top-level OKRs can be about growing revenue, after all, it’s the most popular OKR of them all.
Confusing objectives and key results. A good objective is a short qualitative statement of a measurable intent. A good key result is a quantitative metric, KPI, or other directly measurable data point which serves as a good proxy for our objective. Don’t use quantitative metrics or KPIs as your objectives. It will quickly become clear when you try to determine how to measure one measurement using other measurements… Don’t go there.
Misalignment. Once the top level OKRs have been set, getting the rest of the organization aligned is sometimes very difficult. Whether using top-down, bottom-up, or a negotiation approach, making sure that the rest of the organization is aligned is essential. Our recommendation; use the negotiation method to set OKRs for the rest of the participating team members to ensure that every OKR is specifically aligned with at least one higher level OKR.
Poor communication. OKRs usually happen when things are changing fast. The organization is expanding, lots of new customers, new products, new markets, etc. There is enough going on to keep everyone saturated with information, and introducing OKRs without properly communicating the why, how, and what of OKRs will guarantee failure.
Disengagement. We all just want to get on with our jobs. OKRs imposed from above, poorly communicated and poorly defined will cause a negative response often leading to all the usual fall-out such as lack of engagement, apathy, resentment, and ultimately, higher employee turnover. In addition to communication, a lack of delegated authority causes employees to feel lumped with the responsibility, but without the ability to make the required decisions to achieve their objectives.
Old, bad habits. Setting objectives is not a new phenomenon. Most management frameworks are closely linked to annual appraisal processes, and are almost universally despised by employees, managers, and HR departments alike. Yet somehow they persist. Linking OKRs with appraisal systems makes employees nervous and wary of accepting stretching objectives, for fear of the impact on their earnings and career progression.
New, bad habits. With OKRs, the most common bad habit is to ‘set and forget’ OKRs at the beginning of the quarter, only to ‘rediscover’ them at the end of the quarter. Only hardened procrastinators would prefer such an approach. Another bad habit is to endlessly renegotiate OKRs during the OKR cycle, significantly adjusting OKRs, or even removing and replacing OKRs entirely.
Process hell. The first time I was exposed to the Agile approach, I hated it. The first time someone showed me how to submit my expenses using a new expense management system, I hated it. Introducing a new process can be very difficult. With OKRs, the temptation is to over-legislate, and establish a lot of specific new processes to support the introduction of OKRs. Tread lightly, and adapt as required.