This article was first published on t2informatik blog on 17.06.2021.
Many people are annoyed of objectives and key results and I totally understand it. The more OKR has gained popularity, the more it is misunderstood and misused. It is partly because many consultants see the topic as a new business opportunity to expand their portfolio and only treat and sell the topic superficially. Also some companies start OKR quite euphorically after reading/hearing a book, article or testimonial from successful companies. “If Google was successful with it, surely we will be too.” I am sorry if I now have to disappoint you. The key to success is not OKR itself, but the principles behind it.
John Doerr talks about talks about 4 superpowers of OKR in his book “Measure What Matters”.
The good news: yes, Objectives and Key Results can indeed unlock these superpowers. The bad news, however, is that these superpowers require certain principles.
Many expect OKR to improve focus, but are annoyed when the desired effect does not occur. In practice, for example, I find that some organisations have defined 12 objectives and 5-8 key results per objective. And this at every level. The OKR list is long and labyrinthine.
The reasons for this are often conflict avoidance when making “hard” decisions and a lack of clear strategy. All new ideas and possibilities are affirmed because the organisation is “dynamic”. To this end, I recommend asking the following questions with every new idea:
The last question deliberately addresses focusing. Limiting the number of OKR helps (I recommend max. 3 Objectives and max. 3-4 Key Results) to be able to deal with these questions at all. The OKR limit therefore automatically triggers such questions and conversations.
According to the OKR Annual Report 2020 by There Be Giants, 90% of organisations using OKR name “alignment” as the reason why they introduced OKR. Indeed, used correctly, OKR can work wonders in this area too. However, alignment is unfortunately often misinterpreted.
Alignment does not mean knowing what others are doing. It means that everyone has a common understanding of the vision and current strategy. Vertical alignment may be helpful, but the true power of OKR is only released with horizontal alignment. By this I mean value driven OKR. And this only works with the “big picture” in mind and the realisation that a function is “only” a part of the entire value chain and can only generate end-2-end value together with other functions.
In addition, transparency plays a big role. I have heard of OKR systems where the higher levels of the hierarchy can see the Objectives and Key Results from the lower levels, but not the other way around. There are so many things wrong with that!
First of all, if the teams don’t know what the objectives of the heads of department are, how do they even write their OKRs?
Second, what secrets do the higher levels have that they have to hide? What are they afraid of?
In such an environment, only one thing is possible, and that is useless OKRs that don’t help anyone but only eat up time and add to the bureaucracy.
The idea behind OKR alignment is that people understand the connection between their day-to-day activities and the vision, and that they question the meaning and purpose behind their activities in order to make informed decisions.
Oh dear… Where to start? What horror stories I have heard on this subject… Here are the flop 3:
While it is necessary that goal direction, focus and strategy are defined top-down, the path to the goal should be defined by the teams working on it. People are more likely to identify with goals that they have set for themselves.
The problem with strictly cascaded or too restrictively written objectives is that they leave little or no room for own ideas. If the key result of the head of division becomes the objective of the head of department, the head of department has no room for manoeuvre. It gets even tighter when the teams have to write OKR. Such a procedure limits any creativity and is in fact pseudo-autonomy.
Objectives and Key Results as a command & control mechanism is, in my opinion, a waste of money. Introducing OKR is not easy. It takes time and energy. If the goal of an introduction is to be able to control the teams better, the effort is too bad. The measurable Key Results may look like a found food to some managers, but if Objectives and Key Results is only used like a KPI dashboard, they have actually just expensively implemented an old solution under a new name.
Accountability can only be expected when OKR have been defined by those who are supposed to implement them. OKR used correctly can promote intrinsic motivation.
I would never have thought that some people really believe that creativity and innovation are automatically unleashed with the use of a framework. I wish. What a naïve thought! I’m sorry to disappoint again. However, creativity requires an environment where people feel safe. It needs a culture where mistakes are seen as part of the development process.
People will only write ambitious goals, knowing they may not achieve them, if they are not assessed or evaluated for it. This means that any performance measurement, employee evaluation, monetary incentives, etc. must be decoupled from OKR.
Last but not least, to unleash innovation, the difference between output and outcome must be internalised. Not every measurable goal is a good key result. If I set myself the goal of “writing 10 blogposts”, this goal says nothing about whether these blogposts will be read by people. I.e. only when I can measure the behaviour of my target group or my effect on my target group, e.g. through views, likes, comments, questions, recommendations, etc., do I begin to understand my target audience better and can develop ideas that meet the needs of my target group.
The very first question to ask is:
After that, ask yourself the question:
And lastly ask yourself:
If you remain convinced that Objectives and Key Results is right for you, then ask yourself:
Find out what is the most important thing to focus on first. Do you want to strengthen collaboration? Do you want to increase employee engagement? Do you want to encourage innovation?
Once you are clear about what you need Objectives and Key Results for and what you want to change through them, write OKR for measuring the success of the implementation. Develop ideas on how to get there and how to recognise that you are on the right track and whether you are getting there. If you have done this, congratulations! You are a role model and can experience the challenges, nuances and benefits first hand yourself before asking others to. This willingness demonstrates your commitment to yourself and will inspire others in your organisation.