5 Reasons behind OKR Failure Your Boss Wants To Know

5 Reasons behind OKR Failure Your Boss Wants To Know

OKRs as a goal setting framework have gained popularity in recent years. Many large companies such as Google, LinkedIn, Zynga, Sears, etc. have implemented it successfully.  Naturally other companies are following suit. Most of these  achieved greater levels of success after implementing OKRs in their organisation. Though there are some who have failed to capitalize.

Rick Klau’s seminar on OKRs provides a comprehensive step by step guidance on OKR adoption. He talks about how aligning objectives at company, team & individual level drives a unity of purpose.. While in principle, OKRs are supposed to be easy to implement there can be challenges while implementing them.

Contactually (famously) abandoned OKRs because for them, planning OKRs turned out to be nightmare. Given the stage at which the company was, they needed quicker iterations cycle as opposed to locked-in OKRs.

There are number of factors that drive success or failure of OKRs for a team. We studied a few failures and listed down the most common reasons. At the end of the day though, one must realise a framework is as good as the people that are using it:

Half-hearted commitment to the idea

Usually, the decision to adopt OKRs is taken by the executive level. Obviously they are most excited about implementing them. With its proven track record for Google, Intel, etc, OKRs are expected to bring about a dramatic change in the goal setting process. Not really an unfair assumption. The problem here is that only the top management is able to visualise the benefits.

Regardless of the number of innovative approaches any company might take, its employees need to be fully committed to it. Otherwise the management will not be able to reap its benefits.

Solution:
Educate all the managers and employees on how OKRs can help improve their performance and productivity. Show them how OKRs are not only beneficial for the company but for their personal & professional growth as well.

Not setting Stretch goals:

According to Stretch goals definition, you need to stretch yourself beyond what your mind might think is safe. Similarly OKR methodology recommends that your goals should be difficult to achieve and push you out of your comfort zone.  You are said to be successful if you can achieve 60% to 70% of your goals. On the other hand, if you are able to achieve 100% of target then it means that your goals weren’t ambitious enough.  You didn’t really stretch yourself.

Organisations that fail to set aspirational, stretch goals do not have the potential to break free from stagnancy and achieve excellence.

Solution:

Google sets quarterly OKRs that are very difficult to attain. Teams and individuals are measured by how close they came to achieving them. They believe in setting stretch goals where, “achieving 65% of the impossible is better than 100% of the ordinary”.

Though care should be taken that goals are not set too high as it can lead to demotivation, excessive risk taking or unethical behaviour.

Not keeping track regularly:

It is easy to lose focus despite having everyone’s OKRs defined. Managers need to ideally step in and check their team’s progress at regular intervals. Failure to do so has often led to finding out that much that was expected has not been done. Thus the entire process falls grossly behind schedule.

Solution;

According to Jeff Weiner of LinkedIn, it is wise to conduct weekly meetings. Each individual begins with reporting ‘one’ personal victory thus starting the meeting on a positive note. Also, guidance be provided to anyone facing difficulties.

Incorrect alignment:

Companies that follow a top down cascading approach do not take employee opinion into consideration. Top management dictates goals to the middle management which in turn dictates them to all its team members. Thus employees do not feel any sense of accountability. The feeling is that they are primarily working towards completion of their immediate manager’s goals. While OKR methodology may have been used here, it will not be effective for the company.

Solution:

Management needs to follow 2 way communication where employees too can contribute ideas while setting OKRs. The ideal ratio is 40-60 percent of contribution. One of the key recommendations of OKRs is alignment of objectives at different levels.

Upon completion, align individual goals to team goals and subsequently to overall company objectives.

Lack of proper tools:

The complexity of managing OKRs can be quite overwhelming. One reason is making use of spreadsheets to keep track of them, which is exactly what Contactually did. Management has to spend lot of time and efforts to manage such huge volumes. Companies who started on the right note have abandoned OKRs because they were not able to efficiently use them.

Solution:

There are many OKR softwares available in the market that help the management to efficiently carry out OKRs in the organisation. All the hassles involved with spreadsheets obviously go away.  Thus managers can focus on efficiently tracking, measuring and reporting OKRs at all levels. It is important to look for a few must have features in an OKR software to make sure that you have all the right facilities at disposal.

Have you experienced OKR failures at your workplace? What were the main reasons – let us know in comments.