Most major “what people want from work” studies of the past decade have shown that (a) compensation and (b) opportunities for future growth — often linked topics — are typically the two biggest factors people look for in employers.
After all, employees have lives, and families, and aging parents, and mortgages, and broader needs. Therefore, companies need to be advancing the individual at some level. Doing so is clearly tied to retention, and turnover is a bottom-line hit.
Unfortunately, on the path to individual development, companies tend to make two fundamental mistakes:
- They over-focus on rewarding the top employees, i.e. the A-Players, which no less than Marcus Buckingham—one of the founders of the strengths-based movement in HR — has called “morally reprehensible.”
- They take an idea designed for organizational business impact and try to point it towards individual employee growth.
That second mistake is increasingly demonstrated in how companies roll out OKRs, or Objectives and Key Results. When done properly, OKRs are a great way to give everyone a broader view of where the business is headed. When done wrong? Well, it’s not often pretty.
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The problems with setting individual OKRs
1. Employees ultimately put individual objectives above company objectives
OKRs were never intended to be about individual performance, although many an HR manager still believes that’s a potential function of the concept. Instead, OKRs are about focusing employees, teams, and the whole organization on the greatest collective business impact.
One core problem of individual OKRs is often that employees will put their individual goals above the goals of the company; this can have disastrous effects on any semblance of “culture” or “employer brand.” Your business becomes a group of people hustling for themselves. While some might like that idea on its face, it tends to tank any sense of priority or ability for employees to work cross-functionally. Top performers may get some major things achieved with a focus on individual OKRs, but the overall organization suffers.
2. Individual OKRs introduce unnecessary complexity
Another challenge to consider: managers are often overwhelmed as it is with meetings, check-ins, admin work, etc. If they are already managing team OKRs and need to add individual OKRs, that’s an additional level of complexity to track and report on. All of these tracking elements reduce the amount of time managers have to have conversations and contextualize the work and broader objectives for the team.
3. Individual OKRs reduce employee autonomy
Individual OKRs prescribe how employees should go about doing their work and achieving their end goal instead of just providing a north star to guide themselves there. For example, if a marketing team’s objective is to grow brand awareness and the related key results have been identified, what additional granularity does a marketing manager need to go about performing his/her job?
Diving even a level deeper turns into dictating specifically how that person does their job—what activities they should do to increase brand awareness—and does not allow them the autonomy to figure out what is and isn’t working for the company. Know what tends to happen when you reduce autonomy among your employees? You greatly increase turnover.
OKRs were never supposed to be tasks. Unfortunately, they can feel that way in individual OKR contexts. Consider this breakdown from how Spotify looks at it:
- The Broader Mission (“Why”): Give people access to all the music they want all the time
- The OKRs (“What”): Make jogging more pleasurable with Spotify
- The Tasks (“How”): Create an upbeat morning jogging playlist
Successful companies tend to lead with the “why”. The “why” should lead naturally to the “what,” which then becomes the “how.” Individual OKRs for everyone can muddle this flow and become lengthy to-do lists, and work in many organizations has become too much about tasks as it is.
So, how should you implement OKRs?
Use OKRs at a team level.
At the individual level, it is okay to have one person own one or more metrics, making them primarily responsible for a set of key results. Managers can also work with individual employees to explain the “why” of the organization and tie a high-level individual goal to that “why.” Keep in mind, however, that this requires a deeper view of what’s happening beyond simply an individual employee task list.