OKR Pitfalls: Common Mistakes and How to Get Them Right
The relationship between teams and Key Results Objectives (OKRs) is deep and crucial. In summary, everything should be interconnected. As highlighted in the book “The Wisdom of Teams”:
Within teams, there is nothing more important than each member’s commitment to a common purpose and a set of related performance goals for which the group holds itself jointly accountable.
In this statement, the purpose equates to the Objective, and the set of performance goals refers to the Key Results.
When applied correctly, OKRs have the power to catalyze the formation of high-performance teams capable of achieving remarkable results. However, the challenge lies in applying OKRs correctly. Before moving forward, it’s important to emphasize that we are not disqualifying individual goals. The focus here is to highlight that, when it comes to individual goals, the concept of OKR transforms into something different.
Common Mistakes in OKR Adoption
The most common mistake is an attempt to apply OKR on individual performance. However, the effective application of OKRs faces a common challenge: it’s about teams, focus, and strategy, not individuals. Jeff Gothelf addresses this point in his article in the Harvard Business Review: “Use OKRs to Set Goals for Teams, Not Individuals.”
Another common mistake in OKR adoption strategy is trying to apply them throughout the entire company, “cascading” what has been dubbed OKR. Christina Wodtke, experienced in implementing OKRs in large Silicon Valley companies, shares in her book “Radical Focus”:
“The first time we tried, we made the fundamental mistake of distributing it to the whole team. We had OKRs at the company level, OKRs at the team level, and OKRs at the individual level. It was chaos!”
If you find yourself in a similar situation, don’t worry, as the author mentions, the first attempt of an OKR cycle will likely fail. To increase the chances of success, the book suggests starting small, with one team, one project, and a single objective for that team or project. This way, you learn first and then scale, an advisable approach in many aspects related to agility.
Practical Examples of OKRs
Let’s examine some good and bad objectives, along with their Key Results.
Good Objectives:
- Dominate the retail coffee market for Southeast businesses.
- Launch an amazing MVP that delights customers.
- Build an intelligent solution for high-revenue customers.
These objectives are challenging, achievable, and measurable through Key Results. It is crucial to note how each objective defines its scope in a way that is not overly broad yet attainable. Every good objective should have a clearly defined end.
Bad Objectives:
- Achieve sales numbers above 30%.
- Double our user base.
- Achieve $2 million in revenue.
These objectives are inappropriate because they are actually metrics, i.e., Key Results.
Good Key Results:
- Achieve sales numbers above 30%.
- Double our customer base.
- Achieve $2 million in revenue.
These Key Results measure the team’s proximity to the objective, linking to the established purpose.
Bad Key Results:
- Deliver the project.
- Conduct five trainings.
- Produce one campaign per month.
These Key Results are inappropriate because they represent initiatives and not outcome metrics. The image below adds the initiative to the diagram to help clarify its role in the strategy:
Are we or are we not measuring what really matters? Clarity in objectives and metrics is vital because, as Eliyahu M. Goldratt says:
Tell me how you measure me, and I will tell you how I will behave.
Enjoyed this story? Join our newsletter for exclusive insights. With over 20 years in software, I explore from tech to human behavior, offering content that enlightens and inspires. By subscribing, you support impactful content creation and ensure you never miss updates that enrich your journey. Let’s explore and grow together, click here.
