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Why OKRs fail. Top 5 OKRs fails you need to know and how to avoid them

5 reasons OKRs fails and how you can avoid that!

Most systems/frameworks/approaches to anything organisational or technological always have both their fans and detractors, it’s not unexpected for activities like OKRs to fail.

It is rarely irrational; most people quite reasonably just go on their experience. If their experience with something is good, they like it and if it has been bad, they do not like it. With many management frameworks and systems, the truth is that the experience will be as heavily influenced by the quality and appropriateness of the implementation as it will by the quality of the system itself, and this is very true with OKRs.

OKR failures exist and if you ask about, you can find that OKRs fail relatively easily. What is harder to find is how are people judging their success and failure, and whether OKRs fail, or in fact people failed to use OKRs correctly.

OKRs is a simple and solid framework promising big benefits to organisations that use them (we discuss these benefits here), but one that comes with quite a few implications and requirements. These allow you to determine whether OKRs are right for a particular organisation and what work is going to be required for an organisation to adopt them successfully. Fail to pay proper attention to these considerations and plan for them, and your OKR implementation may well unnecessarily end up as just another failure story.

Here we discuss the top five reasons we see OKRs fail and suggest some approaches you can use to prevent your implementation from going the same way.

Visual infographic
1
Misunderstanding what OKRs are and not treating them as a Strategy management system.

OKRs are a specific framework for developing, communicating, constantly validating and adapting corporate strategy. It is not just a way of tracking the high level of actions that need to be done, or a reporting mechanism for success against big initiatives. If you are already using OKRs and your organisation sees writing them as the only real impact they have on your people’s working life, then you are likely misunderstanding how they are intended to work, and the involvement required for them to work as expected. You will almost certainly not be getting the benefits and people are probably asking, “What is the point of doing them?”

To avoid this situation if you’re planning your implementation or if you have already started using OKRs and are seeing this OKR fail manifest, firstly gain a full understanding of how OKRs are designed to manage strategy in an organisation and what that means for how they should be involved in its day to day operations. (We have written about this here). Once you fully understand what OKRs are and how they are supposed to work, then look to the following:

  1. What changes are necessary for your organisation to move towards this model?
  2. Do not expect OKRs to be a silver bullet that can solve all your problems. Understand what issues you are trying to solve work out where those might be helped by OKRs, and either how to address that in your implementation plan, or create transformation plans for your current OKR system to address those issues.
  3. Identify areas where OKRs could or are causing negative or challenging impacts to your organisation. Understand why those are happening and put treatment strategies in place (an example might be where they may conflict with existing project management methodologies).
  4. Once you understand what OKRs are all about, ask yourself if you are ready and really want to adopt them. It is better to not use them then use them badly and create waste in your organisation and waste a lot of time.

We’ve documented Impacts and Gotchas for Implementing ORKs in this article: Implementing OKRs? How to prepare your organisation.

2
Failure to invest appropriately into the adoption of OKRs

For most organisations, adopting OKRs will represent a significant investment in trying to improve how aligned, connected and outcome-orientated the organisation is. This implies that there needs to be a fair investment made as this will probably represent a transformation of the organisation in several major respects. If the following symptoms apply to your plans for implementation (either proposed or in-flight), then you need to act if you want your OKRs implementation to be a success.

  • A reasonable time and allowance not granted to teams for learning and upskilling.
  • An expectation that work in-flight will not be interrupted through the adoption process; no slack time or allowance for reduced output has been made.
  • No investment in outside training or coaching in how to implement OKRs or in how to create valuable OKRs has been made, and in-house experience is limited.
  • Limited investment into tools and data extraction that support the OKR system.

To manage this situation is to redress the underinvestment that is planned or has been happening so far. The following points will help.

  1. It might sound obvious, but you need to treat the adoption of OKRs as a full change program and treat it as such. It needs to be allocated a budget, set into a time frame, allocated resources, and, as described in issue 1, ensure you know the desired outcomes and are tracking progress towards that end state.
  2. Be clear what you expect in terms of impact on key activities and existing performance indicators. Your teams and leaders will worry about a drop off in activity as teams invest time and effort into learning about OKRs and the time required for cross team and department collaboration. They need to be assured this is expected.
  3. Work with your teams to identify the types of data access and analytics they might need to support a more data driven approach to working. The more transparency and data visualisation you can provide, the faster the feedback loops and learning, the better the outcomes you can obtain. It may also make sense to review OKR management platforms. We’ve worked with great success with Just3things.

Most organisations have huge amounts of undocumented operational and technical debt as well as failing products/projects that are being disguised. OKRs will surface a large amount of this waste in your organisation and this is your payback for the reduced volume of activity during adoption. Once adopted you should experience an acceleration in productivity and achieved outcomes.

3
Failure to sell the change to the business and a lack of clarity and support from leadership

This issue will manifest with the following symptoms.

  • Mistrust and anxiety toward OKRs.
  • Teams enter a compliance mindset just to get them done.
  • Elements of leadership at various levels may dictate lower teams’ Objectives and Key Results, or exert overt influence over the teams in how they achieve their outcomes.

If you are planning your implementation and feel this might be the case, or it’s already started and you are seeing these symptoms, the following treatments might help.

  1. Ensure you develop a story for why you are adopting OKRs and be clear on this message. Explain the drivers for change, what isn’t working well enough that OKRs will fix. Share you vision of the future and what it will mean for people.
  2. Engage the resistance! Find the detractors and listen to them, allow the concerns and fears to be aired and support them through the change process.
  3. Find the people and teams who embrace the change and involve them in the process. Create OKR champions/ambassadors who can help support others through the changes. Spread good news stories when they happen!
  4. See that brown bags and discussion forums are organised to allow people to digest the change and find mutual support.
  5. Ensure a single narrative and enforce it among all levels of leadership. Conflicting messages from leadership will cause confusion/disruption in the teams and will reduce trust in the change.
4
OKRs do not fit your current cultural zeitgeist.

There is nothing wrong with being an activity focused organisation. Many organisations are very successful at developing products and services by focusing on activity and measuring classic indications such as time, cost and quality. Be cognisant of where you are as an organisation and be honest about whether OKRs are actually compatible with where you are. OKRs fail disastrously (usually taking on complete irrelevance, or causing inconsistent disruptions and inconsistencies between business units) where they are implemented in organisations of this type without the reality of the scope of the transformation being understood and planned for.
Assuming the large transformation needed is the right thing for your organisation, then the following pointers may help in your approach.

  1. Be clear to everyone that you are moving your organisation from activity and plan driven, to outcomes and data driven. People will be rewarded for data interpretation and their ability to adapt with data insights and outcome measurements that support activity such as pivoting, halting development that isn’t creating desired impacts and their ability to identify desirable outcomes and how to drive to them.
  2. Examine your funding and budget models and identify any where it is going to be a challenge to adopt an outcome-driven approach. For some teams OKRs just may not be appropriate.
  3. Identify the governance and management frameworks within your organisation that would place a barrier between everyday operation and the adoption of OKRs. Before implementing OKRs into that department ensure you have a transition plan to manage the change and mitigate the risks and issues.
  4. Create organisational OKRs that support this shift in approach, use the OKR system to help you enforce the change and encourage teams to achieve OKRs that drive the new culture.
5
Expecting immediate results

It can take a year for an organisation to become competent at OKRs and the benefits grow slowly over that time. That can be too long for many senior leaders and they can start to lose faith by the second quarter and abandon the initiative by Q3/Q4.

To avoid this failure mode, we offer three main points.

  1. Most importantly it is critical to understand what you are buying and how long it will take to realise the benefits you are expecting. You must plan for the impacts and challenges the implementation will have on your organisation and give it the time and focus it needs to be successful.
  2. This type of change will usually require ongoing support throughout the transformation from OKR and professional coaches to support teams and leaders in both the use of OKRs and in the personal and career development changes that will be required. Investing in this type of coaching will speed up the process and make it more robust.
  3. Stay the course! It will be hard, and it will require commitment and investment from the whole organisation, but there are significant rewards and benefits to be had once the system is in place and operating. Nothing comes for free.
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Why OKRs fails and how you can avoid that!

Most systems/frameworks/approaches to anything organisational or technological always have both their fans and detractors, it’s not unexpected for activities like OKRs to fail.

It is rarely irrational; most people quite reasonably just go on their experience. If their experience with something is good, they like it and if it has been bad, they do not like it.

With many management frameworks and systems, the truth is that the experience will be as heavily influenced by the quality and appropriateness of the implementation as it will by the quality of the system itself, and this is very true with OKRs.

OKRs failures exist and if you ask about, you can find that OKRs fail relatively easily. What is harder to find is how are people judging their success and failure, and whether OKRs failed, or in fact people failed to use OKRs correctly.

OKRs is a simple and solid framework promising big benefits to organisations that use them (we discuss these benefits here), but one that comes with quite a few implications and requirements. These allow you to determine whether OKRs are right for a particular organisation and what work is going to be required for an organisation to adopt them successfully.

Fail to pay proper attention to these considerations and plan for them, and your OKR implementation may well unnecessarily end up as just another failure story.

Here we discuss the top five reasons we see OKRs fail and suggest some approaches you can use to prevent your implementation from going the same way.

Visual infographic
1
Misunderstanding what OKRs are and not treating them as a Strategy management system.

OKRs are a specific framework for developing, communicating, constantly validating and adapting corporate strategy. It is not just a way of tracking the high level of actions that need to be done, or a reporting mechanism for success against big initiatives.

If you are already using OKRs and your organisation sees writing them as the only real impact they have on your people’s working life, then you are likely misunderstanding how they are intended to work, and the involvement required for them to work as expected. You will almost certainly not be getting the benefits and people are probably asking, “What is the point of doing them?”

To avoid this situation if you’re planning your implementation or if you have already started using OKRs and are seeing this OKR fail manifest, firstly gain a full understanding of how OKRs are designed to manage strategy in an organisation and what that means for how they should be involved in its day to day operations. (We have written about this here). Once you fully understand what OKRs are and how they are supposed to work, then look to the following:

  1. What changes are necessary for your organisation to move towards this model?
  2. Do not expect OKRs to be a silver bullet that can solve all your problems. Understand what issues you are trying to solve work out where those might be helped by OKRs, and either how to address that in your implementation plan, or create transformation plans for your current OKR system to address those issues.
  3. Identify areas where OKRs could or are causing negative or challenging impacts to your organisation. Understand why those are happening and put treatment strategies in place (an example might be where they may conflict with existing project management methodologies).
  4. Once you understand what OKRs are all about, ask yourself if you are ready and really want to adopt them. It is better to not use them then use them badly and create waste in your organisation and waste a lot of time.

We’ve documented Impacts and Gotchas for Implementing ORKs in this article: Implementing OKRs? How to prepare your organisation.

2
Failure to invest appropriately into the adoption of OKRs

For most organisations, adopting OKRs will represent a significant investment in trying to improve how aligned, connected and outcome-orientated the organisation is. This implies that there needs to be a fair investment made as this will probably represent a transformation of the organisation in several major respects. If the following symptoms apply to your plans for implementation (either proposed or in-flight), then you need to act if you want your OKRs implementation to be a success.

  • A reasonable time and allowance not granted to teams for learning and upskilling.
  • An expectation that work in-flight will not be interrupted through the adoption process; no slack time or allowance for reduced output has been made.
  • No investment in outside training or coaching in how to implement OKRs or in how to create valuable OKRs has been made, and in-house experience is limited.
  • Limited investment into tools and data extraction that support the OKR system.

To manage this situation is to redress the underinvestment that is planned or has been happening so far. The following points will help.

  1. It might sound obvious, but you need to treat the adoption of OKRs as a full change program and treat it as such. It needs to be allocated a budget, set into a time frame, allocated resources, and, as described in issue 1, ensure you know the desired outcomes and are tracking progress towards that end state.
  2. Be clear what you expect in terms of impact on key activities and existing performance indicators. Your teams and leaders will worry about a drop off in activity as teams invest time and effort into learning about OKRs and the time required for cross team and department collaboration. They need to be assured this is expected.
  3. Work with your teams to identify the types of data access and analytics they might need to support a more data driven approach to working. The more transparency and data visualisation you can provide, the faster the feedback loops and learning, the better the outcomes you can obtain. It may also make sense to review OKR management platforms. We’ve worked with great success with Just3things.

Most organisations have huge amounts of undocumented operational and technical debt as well as failing products/projects that are being disguised. OKRs will surface a large amount of this waste in your organisation and this is your payback for the reduced volume of activity during adoption. Once adopted you should experience an acceleration in productivity and achieved outcomes.

3
Failure to sell the change to the business and a lack of clarity and support from leadership

This issue will manifest with the following symptoms.

  • Mistrust and anxiety toward OKRs.
  • Teams enter a compliance mindset just to get them done.
  • Elements of leadership at various levels may dictate lower teams’ Objectives and Key Results, or exert overt influence over the teams in how they achieve their outcomes.

If you are planning your implementation and feel this might be the case, or it’s already started and you are seeing these symptoms, the following treatments might help.

  1. Ensure you develop a story for why you are adopting OKRs and be clear on this message. Explain the drivers for change, what isn’t working well enough that OKRs will fix. Share you vision of the future and what it will mean for people.
  2. Engage the resistance! Find the detractors and listen to them, allow the concerns and fears to be aired and support them through the change process.
  3. Find the people and teams who embrace the change and involve them in the process. Create OKR champions/ambassadors who can help support others through the changes. Spread good news stories when they happen!
  4. See that brown bags and discussion forums are organised to allow people to digest the change and find mutual support.
  5. Ensure a single narrative and enforce it among all levels of leadership. Conflicting messages from leadership will cause confusion/disruption in the teams and will reduce trust in the change.
4
OKRs do not fit your current cultural zeitgeist.

There is nothing wrong with being an activity focused organisation. Many organisations are very successful at developing products and services by focusing on activity and measuring classic indications such as time, cost and quality.

Be cognisant of where you are as an organisation and be honest about whether OKRs are actually compatible with where you are. OKRs fail disastrously (usually taking on complete irrelevance, or causing inconsistent disruptions and inconsistencies between business units) where they are implemented in organisations of this type without the reality of the scope of the transformation being understood and planned for.

Assuming the large transformation needed is the right thing for your organisation, then the following pointers may help in your approach.

  1. Be clear to everyone that you are moving your organisation from activity and plan driven, to outcomes and data driven. People will be rewarded for data interpretation and their ability to adapt with data insights and outcome measurements that support activity such as pivoting, halting development that isn’t creating desired impacts and their ability to identify desirable outcomes and how to drive to them.
  2. Examine your funding and budget models and identify any where it is going to be a challenge to adopt an outcome-driven approach. For some teams OKRs just may not be appropriate.
  3. Identify the governance and management frameworks within your organisation that would place a barrier between everyday operation and the adoption of OKRs. Before implementing OKRs into that department ensure you have a transition plan to manage the change and mitigate the risks and issues.
  4. Create organisational OKRs that support this shift in approach, use the OKR system to help you enforce the change and encourage teams to achieve OKRs that drive the new culture.
5
Expecting immediate results

It can take a year for an organisation to become competent at OKRs and the benefits grow slowly over that time. That can be too long for many senior leaders and they can start to lose faith by the second quarter and abandon the initiative by Q3/Q4.

To avoid this failure mode, we offer three main points.

  1. Most importantly it is critical to understand what you are buying and how long it will take to realise the benefits you are expecting. You must plan for the impacts and challenges the implementation will have on your organisation and give it the time and focus it needs to be successful.
  2. This type of change will usually require ongoing support throughout the transformation from OKR and professional coaches to support teams and leaders in both the use of OKRs and in the personal and career development changes that will be required. Investing in this type of coaching will speed up the process and make it more robust.
  3. Stay the course! It will be hard, and it will require commitment and investment from the whole organisation, but there are significant rewards and benefits to be had once the system is in place and operating. Nothing comes for free.

Summary

These points cover our view of the biggest “reasons” we see OKRs fail in an organisation, but they are by no means comprehensive in terms of what is necessary to create a successful implementation. A good implementation is tailored to the organisation and will address its specific mix of issues and aspirations to deliver an OKR system that works for the organisation as quickly as possible.

For more information please read some of our other publications on what preparations are necessary to implement OKRs successfully and we hope you enjoyed our article, why OKRs fail. 

Want to find our more?
Shot of a mature businessman waving while using a laptop to work from home

Book a call with a 1ovmany OKR practitioner.

Summary

These points cover our view of the biggest “reasons” we see OKRs fail in an organisation, but they are by no means comprehensive in terms of what is necessary to create a successful implementation. A good implementation is tailored to the organisation and will address its specific mix of issues and aspirations to deliver an OKR system that works for the organisation as quickly as possible.

For more information please read some of our other publications on what preparations are necessary to implement OKRs successfully and we hope you enjoyed our article, why OKRs fail. 

Want to find our more?
Shot of a mature businessman waving while using a laptop to work from home

Book a call with a 1ovmany OKR practitioner.

Find our more about OKRs

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What are OKRs?

What are OKRs, how do OKRs work, what do they look like in practice, and should my organisation use them? Big questions answered here.

OKR Readiness Assessment

Find out if your organisation is prepared and ready to adopt OKRs; complete with a be-spoke report contaning advice and guidance.

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Mike Horwath

Mike is a co-founder of 1ovmany where he leads the company in the area of business strategy and transformation, notably in the realms of OKRs, product, and organisational purpose and design as well as agile software delivery.

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