{"id":6904,"date":"2017-09-14T17:38:21","date_gmt":"2017-09-14T16:38:21","guid":{"rendered":"https:\/\/www.small-improvements.com\/?p=6904"},"modified":"2017-09-14T17:38:21","modified_gmt":"2017-09-14T16:38:21","slug":"are-true-okrs-worth-the-hassle","status":"publish","type":"post","link":"https:\/\/www.small-improvements.com\/blog\/are-true-okrs-worth-the-hassle\/","title":{"rendered":"Are true OKRs worth the hassle?"},"content":{"rendered":"

If you work in tech or startups these days, you\u2019ve probably heard the term OKR. For those not familiar, it stands for Objectives and Key Results<\/a>. It\u2019s a way to structure goal setting and quantify achievement within an organization.<\/span><\/p>\n

Invented by Intel, OKRs really came in vogue in 2014 when Google lifted the veil on their internal work processes<\/a>. The idea is that individual employees have a clear plan to see how their work is contributing to the overall company strategy.<\/span><\/p>\n

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No one-size-fits-all approach to OKRs<\/h2>\n

So let\u2019s say your marketing team\u2019s quarterly objective is to have a successful launch of a new feature \u2013 a solid, achievable goal that everyone in the organization can understand. But what does success mean here? The key results indicating success could be getting 5 pieces of media coverage, publishing 10 customer testimonials, and driving a 10% increase in traffic to the company homepage.<\/span><\/p>\n

Most companies set and evaluate OKRs on a quarterly and yearly basis, with an agreed-upon measure of successful performance like 70% or 2 of 3 key results achieved.<\/span><\/p>\n

Sounds like a perfect solution to your management needs, right? So why isn\u2019t everyone implementing OKRs?<\/span><\/p>\n

The fact is, OKRs are not always worth the hassle \u2013 particularly if you\u2019re a small or medium-sized business. They require effective education throughout your organization, constant evaluation, and a commitment to seeing the performance review process<\/a> through.<\/span><\/p>\n

Are they right for what your team needs? Let\u2019s take a look at the pros and cons.<\/span><\/p>\n

OKR pros and cons<\/h2>\n

\ud83d\udc4d Pros<\/b><\/h3>\n

Goal Awareness Throughout the Company. <\/b>Done perfectly, OKRs help companies align their goals and focus on the big picture. Each team knows what its objectives are and what are the measurable\u00a0key results that will indicate the objective is being achieved \u2013 and the transparency of the process means all the other teams know, too. This is especially important in larger organizations where day-to-day communication between various teams is harder to maintain.<\/span><\/p>\n

Measurement Accountability.<\/strong> OKRs give everyone a common basis for accountability<\/a>, regardless of their work emphasis. All work performed by every department, from customer support to engineering, has clearly stated and measurable goals that are visible within the department as well as throughout the company, and all align to overall company goals, each from their own angle<\/span>.<\/span><\/p>\n

Focus and Prioritization<\/strong>.<\/strong> The cross-company alignment that\u2019s a necessary part of the OKR process essentially requires that everyone identifies the important priorities for that quarter, year, or other segment. If your company seems to be constantly starting new projects and it isn\u2019t always clear if they\u2019re contributing to forward movement, then OKRs provide a concrete way to get everyone on the same page about what work is actually relevant.<\/span><\/p>\n

\ud83d\udc4e Cons<\/b><\/h3>\n

A Hefty Investment: While you can find many resources<\/a> out there on how to set up an OKR-based system, they\u2019re not exactly turnkey solutions. For this type of business framework to be successful, everyone on the team needs to understand how OKRs work, why they\u2019re being implemented, and how their work is being evaluated. That can mean a substantial investment from company leadership to get the full scope of priorities set up and learn how to set achievable OKRs, as well as building in time for trial and error. We recently spoke with one company that first implemented OKRs 18 months ago, and still hasn\u2019t fully integrated their usage throughout every team. That\u2019s why even proponents of OKRs caution that they may not be optimal for smaller companies or earlier stage startups<\/span><\/b>.<\/span><\/p>\n

The Agility Challenge. Work environments can change fast, especially in startups. The goalposts within an organization can always change, so goals should be at least somewhat malleable and not too rigid. In the worst-case scenario, you\u2019ll find yourself at the end of the quarter being evaluated toward progress on a now-obsolete goal that was set three months prior. This is, of course, also a challenge with any objective, but because OKRs are much more involved and detailed, change can look “worse” than with normal objectives: “Didn\u2019t we agree (and spend many days) defining the OKRs? Why the change then?\u201d Some companies set shorter-term OKRs, on a monthly basis, to try and combat this \u2013 but then dedicating executive team hours each month to OKR planning can turn into a substantial time commitment<\/span>.<\/span><\/b><\/p>\n

Misplaced Priorities.<\/strong> Similarly, sticking to something just because you planned on it and documented it can make you blind to new opportunities. OKRs can,\u00a0in this case, be limiting\u00a0if your bonus and evaluation are based on achieving certain objectives with their specific key results. Meanwhile, the company as a whole might have benefited from taking a different approach that wasn\u2019t an original OKR. While some suggest not having OKRs for research-focused or experimental departments of the company that need to be more explorative, that can create confusion when if certain parts of the business are evaluated on different standards than others<\/span>.<\/span><\/p>\n

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Alternatives to OKRs?<\/h2>\n

We\u2019re particularly partial to the \u201clean objectives<\/a>\u201d approach, which asks the following questions: Where do you need to go? How will you know you\u2019re getting there? What will you do to get there? We find this works well for encouraging bottom-up goal-setting and empowering employees throughout an organization.<\/span><\/p>\n

We also feel that the evaluation of objectives should share equal weight with the rest of the feedback process. So yes, one\u2019s work toward a specific goal is important, but so are other components of employee performance, like 360 reviews and ongoing 1-on-1s.<\/span><\/p>\n

Here are some more helpful resources on OKRs:<\/strong><\/p>\n