From Ashes to Awesome: Why OKRs Shouldn’t Be Your Batting Average

After learning and writing about what are OKRs, how teams / organisations can reap the benefits of this framework and the common mistakes made during the OKRs journey, I also want to talk about my mental model about this framework around performance evaluation. According to me using OKRs for performance evaluation can be a devastating mistake, as it fundamentally misunderstands the purpose and benefit of OKRs.

While OKRs are designed to drive focus, alignment, and engagement towards ambitious goals, using them as a basis for performance evaluation, compensation, and promotion may introduce several issues:

1. Gaming the System: When OKRs are tied to performance evaluations, there’s an incentive for individuals to set less ambitious goals to ensure they meet them, leading to a culture of low expectations and minimal risk-taking. This gaming of the system undermines the spirit of OKRs, which is to encourage stretching beyond comfort zones to achieve remarkable outcomes.

2. Stifling Innovation: The pressure of having OKRs linked to performance reviews can discourage innovation and experimentation. People might feel less inclined to pursue innovative projects or ideas that carry a risk of failure, even if these could lead to significant breakthroughs, because their primary concern becomes safeguarding their performance metrics.

3. Misaligned Motivations: The intrinsic motivation to excel and contribute to the organization’s success can be overshadowed by extrinsic motivators such as bonuses or promotions. This shift can erode team cohesion and reduce the genuine engagement and collaboration that OKRs are supposed to foster.

4. Reduced Ambition: Knowing that their performance evaluation depends on meeting OKRs, individuals might set their sights lower to ensure they achieve their targets, reducing the overall ambition and potentially slowing organisational progress.

5. Misinterpretation of Failure: In an environment where OKRs are used for evaluations, failure to meet ambitious key results may be viewed negatively, rather than as a learning opportunity. This perspective discourages risk-taking and exploration, which are essential for growth and innovation.

Using OKRs for performance evaluation can misalign organisational goals with individual performance, potentially leading to detrimental effects on team motivation and innovation. This practice might prompt individuals to set less ambitious goals, minimise risk-taking, and prioritise personal achievements over team or organisational objectives.

Again relating this to a cricket team, where players are only picked based on personal stats. A batsman obsessed with maintaining their batting average might play defensively, sacrificing risky shots that could win the match. Similarly, a bowler might prioritise wickets over containing runs, neglecting tactics crucial for overall victory.This is the pitfall of using OKRs solely for performance evaluation.

In software development, developers measured on lines of code or closed tickets might focus on easily completed tasks, neglecting complex problems that could lead to breakthroughs. Chasing personal metrics stifles innovation and fosters a “check-the-box” mentality over meaningful contributions.

For evaluations, organisations should consider metrics and methods that accurately reflect individual contributions and achievements, separate from the aspirational nature of OKRs. OKRs are A Compass, Not a Scorecard. This framework is powerful for setting goals and fostering ambition, but they shouldn’t be performance reviews. Let OKRs inspire excellence, not measure individual achievement. Watch your team work together, take risks, and ultimately, win the championship.