personal growth is critical to company success
OKRs

Top 11 Common OKR Challenges to Overcome

April 8, 2021
Emily Vo
Kaisa Savola

OKRs are an effective yet simple goal-setting practice. As with most frameworks, OKRs are simple to understand yet difficult to master and implement accurately. Here are the top 11 OKR challenges to overcome.

1. You create business-as-usual OKRs

This is the case where OKRs are written principally based on what the team believes it can achieve without changing anything they are currently doing, as opposed to what would push the company’s growth and impact. As you may know, OKRs are intended to provide a great structure to encourage organizations to set and act on ambitious goals. Thus, it defeats the point of OKRs when used for business-as-usual activities. KPIs and balanced scorecards are better suited for such business-as-usual activities.

2. You set and forget your OKRs

A credible and sustainable cadence is key to effectively use OKRs. You and your teams should update the progress of your key results regularly. A regular check, preferably weekly, is crucial to accurately assess progress and have a disciplined approach to meet set objectives. Otherwise, at the end of the quarter, you may find that you are way off track! Without these regular checks, OKRs also quickly become a quarterly ritual that does not add much value to the organization.

3. You confuse Company-level Objectives with revenue targets

People often believe that Company level Objective should be either “Increase revenue by X%” or “Reduce cost by Y%”. These are not Objectives, these are KPI targets – levels of performance you want to achieve.

A Company-level Objective is a directional statement clarifying the overarching focus area for a quarter. If a company wants to achieve a higher revenue number, a quarterly Objective could be focused on new partnerships acquisition, or expanding to a different market, or improving brand reputation, or improving customer satisfaction, etc. There are many specific things a business could focus on, and it might be hard to prioritize. That is why leaders should be asking for input from team managers and their teams.

4. You fail to keep the big picture in mind

This common OKR mistake occurs when Team-level OKRs are not aligned with Company-level OKRs; or when individual development goals and milestones are not contributing to achieving Company, Team-level OKRs. Thus, management should be discussing with team leaders the role their team plays in the bigger picture, and employees should understand how their personal development can help achieve Team OKRs as well as the Company OKRs. Also, you should make sure to have a meeting when OKRs are created so you can move everyone in a unified direction.

5. You have too many Objectives

More Objectives for a single team do not mean more accomplishments and setting too many Objectives usually reveals an inability to focus on what is most important, but it could also mean the impact of each Objective is too small. Many Objectives with small impacts do not provide a clear focus and are probably not inspiring. 

Besides, an Objective is an improvement area or a problem that you would be solved within 90 days, and there can be many projects contributing to a single Objective. So, if you have too many of them, consider taking a step back and learning how to write good Objectives. It is highly recommended to pick the 3 or 4 matter-the-most Objectives per year or per quarter with up to 3-5 Key Results. That way, the amount of work will be much more manageable and far less confusing.

6. Your Objectives are too challenging or not challenging enough

You may think that your team completing 100% of their goals is great! However, you may be setting goals that are too easy. Objectives should be ambitious, but not too difficult. You should expect to achieve about 70-80% of an Objective in a given quarter. Any more or any less and you may want to reevaluate your OKRs.

7. You have unmeasurable Key Results

It is important to remember Objectives are your big, ambitious goals, and Key Results measure the achievement of an objective. Key Results help to define what success looks like and help you understand when you can say “Oh we did great!”. Key Results are not actions to achieve an Objective, they actually are how you define the success of the Objective. Thus, Key Results should be numeric to make it possible to track progress towards your Objective.

8. You use words like “at least” or “above” for Key Results

As most people know, Key Results should be challenging. If you use phrases like “at least” or “above” in your Key Result title, you are basically saying you expect people to reach at least the target value. That is either not setting a challenging target for yourself or risking to demotivate your team by setting a challenging target and labeling that the bare minimum.

Let’s say your “at least”-target value is not really challenging. We can then assume that that target will be hit before the quarter is out. What will happen next? Progress will already be at 100%. Do you expect people to stretch themselves further? It’s probably not going to happen. The whole idea behind the 70% rule is that you deem it feasible to get to 70% progress, and 100% is a stretch. So, remove phrases like “at least” from your Key Result title, and increase your target value instead.

9. You use saying “have less than” or “have maximum” for Key Results

We have seen it all too often that people set up a Key Result like “Have less than 4 customers cancel their subscription this quarter” or “Have a maximum 10% unsubscribe rate for our newsletter.” Imagine what this does. For the cancellation example, progress at the start of the quarter will be 100%. You may lose 1, 2, or 3 customers through the entire quarter, and progress would still show 100%. Just by looking at progress, everyone would think you are doing fine on that Key Result. Then in the last week of that quarter, a fourth customer cancels. Now all of the sudden progress drops to 0%. That is bad, and what is even worse is that there is no way for you to fix that progress. You should avoid this at all times.

10. You use tasks as Key Results 

OKR framework is not a collection of tasks. It primarily focuses on outcomes or results rather than output or activities. As Google’s re: Work states:

“One thing OKRs are not is a checklist. They are not intended to be a master task like…Use OKRs to define the impact the team wants to see and let the teams come up with the methods of achieving that impact.”

In a nutshell, a task is something done by a team or individual while a Key Result is achieved by completing multiple tasks and to achieve an Objective, multiple Key Results are acquired.

11. A Key Result becomes an Objective

If I assign my Key Result to "Increase NPS from 30 to 50" to another person and I want it to become an Objective for that person, his/her Objective will be "Increase NPS from 30 to 50". The Objective now contains a metric (NPS). If s/he decides to create Key Results for this Objective, these Key Results cannot drive progress for the Objective. When an Objective or Key Result (or any other goal for that matter) contains a metric, it is the metric that will define its progress. So, we are stuck: that person has an Objective for which s/he cannot create Key Results anymore.

A much cleaner and simpler approach would have been to assign the Key Result "Increase NPS from 30 to 50" to another person without it becoming an Objective for them. By assigning the Key Result to another person, I make that person responsible for achieving it. There are many things the person could do. Specifically, in Talbit, s/he will create goals and milestones to develop his/her skills, expertise, and knowledge within the development sprint to achieve this Key Result.

“I have not failed. I have just found 10,000 ways that will not work.”

This quote by Thomas Edison should help you remember that mistakes are a part of the process, and there is really no avoiding at least some of them. So do not be too hard on yourself when you recognize some of these challenges as your own experience.

But what you should put in writing and never forget is that OKRs are supposed to bring everyone together and improve teamwork. This can only be achieved through communication and working together on figuring out the most important priorities. Yes, it will take time to master OKRs, but you will not regret it.

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