When working with OKRs for the first time, you may unknowingly make a lot of OKR mistakes in the adoption process. Although on the surface OKRs can seem simple, there are many nuances to consider when implementing OKRs in your organization.
Ever wonder why so many OKR books, consultants, and software vendors exist? It’s because OKRs are an ongoing discipline that require planning and management. Without careful consideration, OKR mistakes can become rife and plenty.
Today, we’re sharing a few of the most common OKR mistakes so you can save time, avoid headaches, and quickly gain the benefits of OKRs.
Mistake 1: Getting your OKR components wrong
By far one of the biggest OKR mistakes is not understanding how the components work together. If you don't clearly understand the key components and their differences, you won’t be able to follow the OKR method effectively. As a refresher, there are two parts of an OKR: the objective and the key results.
Objectives need to be inspirational, qualitative, and declare your intent about what you want to achieve. Key results, on the other hand, should be quantitative and demonstrate how you will measure progress against your objectives. For each objective, you typically will have 3-5 key results. Tasks are the day-to-day activities that you complete to achieve your key results.
Want to learn more about the basics of OKRs? Read What are OKRs?
Mistake 2: Not writing stretch goals
OKRs provide a framework for execution toward a goal. The point of having this framework is to align strategy and execution so you can do more of the right things in less time. If your goals are business as usual or being just above average, then you’re not getting the full value of OKRs. You can easily overcome this OKR mistake by thinking big and pushing the limits of your capabilities with creating OKR goals.
An example of a stretch goal would be to launch an app that reaches number one in your product category within three months. This would be considered a stretch goal as its ambitious and difficult, but still in the realm of possibility with sufficient creativity.
Mistake 3: Overestimating your capabilities
In contrast, setting goals that are too ambitious can easily turn into another OKR mistake. If you set OKRs that are unrealistic, your team can run into a few problems like:
- Instantly recognizing the goal as unachievable so they don’t put in the effort from the beginning
- Becoming demoralized if goals are consistently unachieved
- Bad behavior such as cutting corners, lying, or shifting responsibilities just to complete a goal
The answer is to set goals that push your team’s limits, are realistic, and ideally backed in past performance data.
Mistake 4: Setting too many objectives
Another key purpose of OKRs is to ensure you get your priorities right. Part of this process involves deciding what you need to focus on — the objectives that will make the biggest impact on your business.
If you set too many objectives, then the OKR framework will start working against you, turning into a costly OKR mistake. Instead of radical progress, you will create stagnation as your team splits focus and resources across competing priorities. OKRs work best when you take the time to identify the most critical objectives to focus on and align your team from there.
Mistake 5: Confusing KPIs and OKRs
Another OKR mistake is using KPIs and OKRs interchangeably. Your key performance indicators (KPIs) and your objectives and key results (OKRs) are related but serve different purposes. Your KPIs, in many cases, will be the metrics used when defining what your key results are.
For instance, if you have the objective to “create an unforgettable customer experience,” one of your key results may be to increase your net promoter score (a KPI) by two points. Keep in mind that depending on your current focus, you may have KPIs that are important but don’t fit neatly into your key results.
Learn more about OKRs and KPIs
Mistake 6: Underestimating OKR adoption
Like with any change in your organization, the process of adopting OKRs must be thoroughly planned and executed correctly. There are several ways OKRs can go wrong (that’s the reason you’re reading this article), but adoption doesn’t have to be one of them.
To remedy many of the challenges of OKR adoption, it’s useful to have an OKR champion within your organization. Having somebody responsible for OKR implementation means a greater likelihood of consistency and follow through, reducing OKR mistakes along the way.
If you need help, OKR consultants can also be a beneficial resource when you’re in the early stages of your OKR journey.
Mistake 7: Poor OKR management
To get the benefits of OKRs, there is a level of work and management needed across your organization. But if your company makes the OKR mistake of not tracking achievement, the challenging "set it and forget it” syndrome can occur. In turn, OKRs can become another management gimmick. Here are a few things you can do to combat this:
- Hold weekly check-ins to solve problems, promote accountability, and measure progress
- Leverage a confidence-based scoring system to identify challenges
- Create the business habit of OKRs through language, software, and processes
Mistake 8: Setting OKRs without your team
One of the great things about OKRs is they bridge the strategy execution gap in organizations. As a leader, you have the strongest grasp on strategy, but you might not be following all the finer details of the day-to-day execution. So, if you’re setting OKRs for your team and making the OKR mistake of not involving them in the process, it can cause some challenges. You might not have all the details on their work and you run the risk of setting unrealistic goals.
In addition, you miss the easy opportunity to boost employee engagement by having your team involved in defining what to work on. Setting top down or cascading OKRs has its uses in some environments, but the best practice is to set OKRs in collaboration with your team.
Mistake 9: Misalignment among your departments
Your OKRs need to align your entire organization toward your most critical objectives. The dynamic nature of modern business means individual departments often don’t have the capacity to achieve goals singlehandedly.
Sales, for instance, requires a powerful marketing engine in addition to the legal team giving them enough flexibility to close deals. If your teams have competing priorities, objectives won’t be achieved. You will need to ensure your OKRs are defined and assigned in a way that each department is working harmoniously towards the same key objectives.
Want to learn more about OKRs by team? Read our article on OKR examples
Mistake 10: Not using software
If you’re running a quick experiment with OKRs, it’s okay to manage the process with common collaboration tools such as Google Sheets or Excel. But once you’ve fully bought into OKRs, you need OKR software to make the process run smoothly. Without software, this OKR mistake can affect your ability to:
- Access performance data to track progress against OKRs
- Easily manage your OKR program to ensure adoption and use
- Create transparency of OKRs – a lack of which causes misalignment
There are a lot of great OKR software options on the market that can fit your company size and budget. Read our OKR Software Buyer’s Guide to learn more about what to look for in a technology partner.
Mistake 11: Setting the wrong cadence
When looking at an OKR cadence, it represents the timeframe in which you aim to achieve your objectives. A common OKR mistake companies make is to work solely on an annual cadence.
This is less effective than a quarterly cadence because:
- Your business environment is constantly changing which means the objective you initially set may become irrelevant as time goes on
- Working on a faster cadence forces you to get more done in less time
- A faster cadence allows your team to collect wins with greater regularity, boosting engagement
Some companies opt for even shorter cadences such as six weeks, but this may not be effective for all companies. As a best practice, aim for a quarterly cadence to start and iterate from there.
Mistake 12: Linking OKRs to compensation
Although OKRs are an effective way to define and measure progress, it’s typically not a good idea to tie objective achievement to employee compensation. OKRs work best when you set stretch goals — it's about pushing the limits of your capabilities in a structured way to unlock more value.
If you make the OKR mistake of tying OKRs to compensation, you end up with a culture of sandbagging. This is when teams and individuals deliberately set more achievable objectives in order to be compensated fully. To solve this, leverage quarterly performance reviews in addition to OKRs. This will give you a separate way to handle compensation without creating perverse incentives.
Mistake 13: Delegating OKRs to HR
Since OKRs can be part of a performance management process, some companies will make the OKR mistake of delegating the management of OKRs to their HR department. As we’ve discussed, OKRs need to encompass strategy and execution, in addition to performance management, so delegating to one department to handle just won’t work.
Your OKRs need to be created and managed at all levels of the organization — from senior executives down to individuals in each department. Without doing so, you will not be able to identify the critical objectives, in addition to gaining an accurate sense of your company's capabilities.
Mistake 14: Not balancing adaptability and commitment
Getting the most out of OKRs requires being both adaptable and committed, depending on the current circumstances. For instance, when introducing OKRs, there’s a good chance you won’t deploy the method correctly and set optimal OKRs.
And in constantly changing business environments, your OKRs may need to evolve so your company can better maneuver against competitors. In these cases, not taking an adaptive approach to your OKRs could be a grave OKR mistake, where you risk working on the wrong things, demoralizing your team, and potentially losing market share.
Conversely, at some point you will need to be committed to the OKRs you set. Changing OKRs too quickly and not being persistent enough toward an objective means you won’t fully unlock the value of working toward ambitious goals.
Mistake 15: Having unrealistic expectations
OKRs increase alignment and bridge the strategy to execution gap, but they can’t (alone) solve the deeper problems your business may have. Having the wrong strategy, lacking key personnel, and being disrupted by innovative upstarts aren’t things OKRs can solve — at least in a direct way. OKRs will make you more effective at whatever you focus on, but they need to be combined with other business strategies.
Mistake 16: Overcomplicating OKRs
OKRs aren’t a simple or easy method to get right — particularly for larger organizations with many moving parts. But that doesn’t mean you should overcomplicate and stall the adoption of OKRs.
An OKR mistake some organizations make is to fall into a perfectionist mindset, bloating the OKR implementation with various layers of approvals, meetings, and over analysis. Although there is depth to the OKR method, you don’t need to do everything all at once and you should accept that OKR adoption won’t be perfect in the beginning.
Mistake 17: Blaming the method
At the opposite end of perfectionism is adopting OKRs too quickly. Some companies make the OKR mistake of jumping in headfirst, but this may lead to unsatisfactory results – either in the form of failing to meet unrealistic expectations or simply using the method incorrectly. It then becomes easy to dismiss the OKR method as simply ineffective.
OKRs have been proven to work for companies of all sizes across all industries. If OKRs aren’t or haven’t worked for you in the past, consider hiring a consultant or leveraging software to get the most out of the method.
Mistake 18: A lack of organizational transparency
OKRs thrive in organizations that are transparent. If there’s a lack of transparency in company-wide objectives and key data sources, it can lead to:
- Poor clarity about who’s working on what, potentially leading to duplicated effort
- Low alignment between teams, reducing collaboration toward broader objectives
- Losing the value of a data driven culture in terms of accountability and engagement
Revamping your culture, processes, and technology to become more transparent are essential components of an effective OKR strategy.
Mistake 19: Not using OKRs for learning
OKRs are often compared to a compass or GPS system for organizations. The framework helps clarify direction and accelerate momentum, but there will be detours and adaptations that need to be made along the way.
This means that in order to chart the correct course, your team will need to be constantly learning — both from weekly meetings and end of quarter reviews. The key learning takeaways then need to be used to adjust your OKRs for the next quarter so you can be even more effective.
Mistake 20: Using OKRs for micromanagement instead of empowerment
The purpose of OKRs is to align your company toward a common goal; empowering teams and individuals to push the limit of their potential. If you're making the OKR mistake of using OKRs as a weapon to force productivity, then you’re misusing the method and will likely not gain its full benefits.
In addition, it’s unlikely you or the executive team will have enough insight into the details of each department's capabilities. If you set and manage all the OKRs from the top down, there’s a good chance your team will end up working on the wrong things or not working toward realistic goals.
Moving beyond OKR mistakes
Like with any management method, implementing OKRs must be done in the right way to be effective. Managing change, choosing the right technology, and getting external help are a few ways you can make OKR adoption more seamless.
Although there are many management approaches you can take to increase your team's efficiency, OKRs as a framework can truly give you an extra edge over competitors — especially when actively working to overcome the OKR mistakes mentioned above. When done properly, OKRs have the power to clarify focus, align organization and tap into the creative power of every member of your team.
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