(or OKR’s, Rocks, and KPI’s Oh My)
Dorothy: “Do you think we will meet any wild animals?”
Tin Man: “We might”
Scarecrow: “Animals that eat straw?”
Tin Man: “Some, but mostly lions and tigers and bears”
Dorothy: “They may take our lives, but they’ll never take our freedom!”
In all honesty, I’m not quite sure about that last line, but I guess that’s the risk one takes when pulling quotes from a cable news network (!!)
Returning to the analogy, the main question for this discussion is “Are OKR’s, KPI’s, Rocks, and Balanced Scorecards dangerous?”.
I believe we can all agree that goal-setting frameworks and the tools used are table-stakes for effective execution. There are several tools and techniques to choose from and each has its own unique flavor and application that lends itself to a given situation. The ubiquitous usage of these tools and the thousands of consultants spawned as a result are proof enough of their potential effectiveness.
But are these tools dangerous if not used properly, and if so, how can they negatively impact your organization?
The answer to that question is absolutely “Yes”.
Over the course of many years, I have unfortunately witnessed these tools used in such a manner as to create serious organizational challenges. The bad news is that too many teams and organizations fall into this group. The good news is that if you can recognize these situations, you can be an effective change agent.
The situations where challenges arise fall mostly, although not exclusively, in the People Management processes of Employee Engagement and Performance Management.
Engagement is a broad topic with many differing thoughts of what employee engagement looks like. For the sake of this discussion, let’s define engagement as “the degree an employee feels positive about his/her work”. An organization builds a high level of engagement when individuals understand how their work impacts the organization, feels that targets are challenging but not impossible, that their input is important, that their efforts are valued, and that leadership has their best interests at heart.
Consistently high performing teams always have a high level of engagement.
This is why every leader desires to have a highly engaged team. It makes their job easier, the work environment more pleasant and employees more excited to put in the extra effort for team success.
Unfortunately, too many leaders see engagement as a nebulous and magical occurrence. Some even fail to see the value in it. The truth is that building engagement is really very tactical. There are actions to take and boxes to check. (More on that another day)
Here are a couple of the most common ways that organizations unwittingly misuse these goal-setting frameworks to destroy employee engagement –
Top Down Targets:
I used to hate it when my parents told me to clean my room NOW. Not that I didn’t appreciate a clean room. When I decided it was time to clean the room, I went about the task happily and thoroughly. When my parents told me to do it NOW — I shoved dirty clothes under the bed, or the back of the closet, and did the minimum to satisfy the request. (My brother, who I shared a room with, can attest to this)
I am the same with work assignments, and I know many that feel the same way.
Not allowing sufficient time to ensure that input from all the team members is received and acknowledged will decrease engagement. Individuals will feel they weren’t listened to and will not take ownership of the targets.
Losing the Logic:
It is imperative that each member of the team can see the link between their efforts and the organization’s goals. This provides a common purpose all can celebrate when the team succeeds.
When the goal setting process is too complicated it is hard to see the linkage. Complexity increases the probability of folks feeling detached and not accountable.
Keep it Simple.
We all want to make data driven decisions. Numbers are important. However, if we forget how to integrate our goal-setting framework with our performance management process we will inevitably create unwanted employee churn. Just as important, we will derail opportunities to build a culture that attracts and retains the most talented employees.
Talent Management requires consistent performance feedback in some shape or form. Studies have shown that most people prefer any type of feedback, including negative feedback, over the uncertainty of no feedback. This becomes much more difficult if metrics attainment is not in sync with performance.
There are two main challenges:
Goal Management not flexible:
Organizations today need to be flexible. Obstacles and opportunities present themselves almost daily. Successful teams leverage the opportunities and mitigate the obstacles as they become apparent.
Performance Management periods vary in length from quarterly to yearly. It is not unlikely that over the course of the a performance cycle the organization’s direction and targets might shift. This would logically impact individuals KR targets.
Too many times performance review KRs reflect an old strategy. This creates issues and a mismatch between KR achievement and employee contribution.
Goal Metrics not allocated equitably:
This is one of the reasons why I believe it is best for managers to allow their direct reports to submit their KR targets. This is the only way I can think of to eliminate the discussion fairness of allocation. Every team, region, or organization is different. Any attempt to design an algorithm to fairly divide the work, will be overly complicated, and will ultimately fail to ensure 100% agreement.
Remember, engaged employees will often over commit rather than set an easy target. This may also kick off a valuable discussion to ensure that the individual understands the metric and the importance of her/his work to the success of the organization.
Goal Setting Frameworks are here to stay. Whatever system we chose, we need to remember the following to ensure that we don’t run into the flying monkeys:
- Keep the frameworks fresh and relevant.
- Involve the entire team — everyone should have input.
- Work hard to maintain fairness.
If you would like to continue the discussion or see more articles like this, please visit Ajito.io or email me at firstname.lastname@example.org.
Until we chat again!
X-Googler & Co-Founder at Ajito. Leveraging over 30 yrs exp. building & growing tech orgs to achieve Clarity, Predictability, and Engagement.