OKRs can be set on many levels but that doesn’t mean they should be set on every level possible. One common misconception is that OKRs should be set on an individual level. It makes sense that people have their weekly plans and maybe also a list of individual KPIs. But OKRs are a bit different. They rarely produce any business value if they are set on individual levels. Of course, that doesn’t mean that individuals do not work towards any goals. They do, they work collaboratively towards their team goals.
Let us explain why your company shouldn’t ask people to set individual OKRs and should instead focus on the Team OKRs.
Team vs. Individual Goals
When we explain to customers that OKRs should be set on a team level, and personal level goals are not needed at all, they are at first resistant to this idea They think that for success they need to tell each person to set goals and later keep a close watch on how each person is doing.
Companies hope that individual OKRs add more responsibility and therefore people take more action. But what we see happens is that people feel frustrated and don’t understand why they have to do it. They set easy and rather task-based goals which actually doesn’t bring any value to the bigger picture. Instead of collaborating and creating brilliant ideas together, they struggle alone with small tweaks. Eventually, forcing individual OKRs might just kill any motivation to do OKRs at all.
Don’t get us wrong, we are not saying people never need goals. Individual goals are important, but their focus should be on personal development. There is a huge difference between setting team goals that drive the company forward versus people developing themselves to have a better career and happier life.
Team OKRs don’t mean people are anyway left out of the process. The purpose of Team OKRs is to actually focus people to work towards them every day.
To prove our point, let’s walk you through one example. This kind of scenario is something that happens to many companies.
OKR implementation in Company x
Company x is a software company that offers productivity and tracking tools for businesses. They have been on the market for a couple of years and are still figuring out some things. For the last half of the year, they have been having problems with revenue. It’s clear that they need straightforward goal-setting to drive improvements and focus on measurable results. They decide to set OKRs and start the necessary learning process and discussions.
Management starts by thinking about what the overall focus should be for the company. After discussing with the team managers they realize that their approaches and processes need to be improved. There are not enough leads, sales take too much time or fail completely, and the product has problems with on-time and bug-free releases.
With all of this in mind, management decides that the company’s overarching Objective will be to “Improve our processes to drive revenue back to positive”.
Now, it is time for the teams to set their goals.
Here are two ways how this company can approach OKR settings: first is by focusing on personal OKRs and the second is by focusing on Team OKRs.
Approach 1: Focus on Personal Goals ⛔️
After the management discussion, the sales team manager goes back to his team and announces that the results are low and everyone needs to set goals for themselves to have better results.
Team members are struggling with setting the goals and it takes a month before everyone has added their “OKRs”. People end up writing down how many meetings they need to have, what kind of email templates they need or what sales books to read. Instead of measuring outcomes they mostly end up counting how many things they plan to do. Everyone is thinking about their own results but not what sales as a function should improve. Personal goals become more important than having better results as a team.
At the end of the quarter, some results might come in but the problem is that people have been pushing harder to get the results which have been tiring and they are losing motivation. Personal goals were just micromanaging and took the focus from the bigger picture. Even the ones that were written well didn’t actually help move the team forward. The team members might be smarter in some ways but if they decide to leave the team, so goes the new knowledge.
If each person has their own goals to achieve, then other team members’ problems are mostly their own issues. I have my own efforts to make, why should I put my energy into yours? Instead of working together as a team, people might end up competing with each other to have better results on their goals. Also, because the team never focused on setting actual measurable and business value-oriented Key Results on a team level, they don’t know how much or if anything was improved. Or even what or how exactly they were supposed to improve.
This isn’t what a team should be doing and it doesn’t move the team forward. As Henry Ford said, “If everyone is moving together, then success takes care of itself”. We think the time has proved that he definitely knew the secrets to a successful business!
Let’s take a step back to the beginning of the story. Now, instead of asking people to set their personal goals, teams will set their OKRs together.
Approach 2: Focus on Team Improvements ✅
The company shares its overarching Objective “Improve our processes to drive revenue back to positive”. Now it’s time for the teams to set their contributing goals.
The Sales team knows that the current approaches do not work and they need to change something to start selling more. After discussing together with the team, they have concluded that something is up with their sales process. It takes too much time to close the deals. Many potential customers seem to get tired in the process so they go to competitors. The Sales team chooses to set a quarterly Objective “Speed up our sales cycle”. It contributes to the company’s Objective and should eventually help to increase revenue.
After setting the Objective, the team also sets the Key Results. For example, good Key Results would be:
KR1: Reduce lead to sales time from 60 days to 31 days on average
KR2: Increase SQL to trial conversion rate from 30 to 60 %
Once the OKR is agreed upon, the team starts working on achieving it. Now, even though it’s a team goal, each person has his or her own role and responsibilities.
Each week team members set new plans to execute and the week after they check how much was done. They share lessons learned to improve their collective knowledge. Together they measure the progress of Key Results and discuss any occurring challenges.
Because they are working together as a team, they can make decisions that have a bigger impact and change how sales operate. Everyone can test new ways and collect feedback. Which is later shared and conclusions are made based on the experience of the whole team, not just one person.
At the end of the quarter, the Objective is achieved with really satisfying progress of 82%! Sales take less time, fewer customer drops off in the process which means it also helps with increasing the revenue. The Sales team has been improved and is ready to take on another challenge.
When the Team Objective is accomplished, the positive change is rather long-lasting or even permanent in some cases. It doesn’t matter if someone is on sick leave or leaves the company permanently, the Objective has improved the sales as a function and new ways can be applied by anyone. Instead of just working harder, people work smarter. Which means they are more motivated and bring more to the table.
Key Takeaways from Company x Example
1. Personal OKRs are not valuable to the business, they are for personal growth. Even though personal growth is also important, teams need to focus on their collaborative growth as well. For that, teams should focus on team-level goals. Individuals can always set their own goals as well if they want to but it’s not something the company/team needs to think about. Or, more importantly, it is not something that shouldn’t be demanded from people.
2. Personal OKRs set limits and end up driving small tweaks and quick fixes that are in many cases dependent on more effort. Personal OKRs do not drive actual positive change on a team level. Rationally speaking, one person in a team of 5 can’t change that whole sales process. But when the team works on it together, they are more likely to succeed in changing the sales process as a whole.
3. Personal OKRs drive people to be competitive and divide the team while Team OKRs encourage collaboration and exchange of great ideas. With Team OKRs, people are not struggling alone with the challenges. Those become team challenges that will be solved a lot quicker because many heads are put together.
4. Personal OKRs make the company dependent on certain persons while team OKRs improve the whole team as a function. It reduces the risk for the company. The positive changes made while executing Team OKRs are long-lasting vs having small personal changes that are always dependent on a certain person’s effort. Teams should not lose their capability to function and deliver good results if people leave the company. Of course, if new people join the team, it takes time to adapt but if the team has everything in place then the results follow fast.
5. Team OKRs are a lot more motivating. Team members can work together on things, encourage each other and help each other out with the challenges. Results should be celebrated together! It’s much better than constantly worrying if I can achieve enough on my personal goals, and what should I even do.
6. Personal OKRs slow down the company. Imagine that all of the employees need to set their OKRs… which is pretty hard because OKR principles are hard to follow on an individual level. Then the managers need to make sure that this somehow aligns with what the team or company wants to do. A lot of back and forth reviewing and agreeing. Eventually, you will have tons of tasks listed as Key Results, and focus from business-valuable outcomes is shifted to just doing things. Believe us, people will be tired and they won’t see value in that.
Google & Spotify Agree: Keep Teams in Focus
Google tried Personal OKRs, it didn’t work. Spotify tried Personal OKRs, it didn’t work. We in Weekdone tried it, it didn’t work as well… So this is a friendly recommendation from many companies that learned this lesson the hard way – focus on the Team OKRs and do not force your people to set their own Personal OKRs!
👉Weekdone’s OKR tool is a great way to fast-track your OKR implementation process. We’ve built Weekdone to help you learn, implement and track your team & company OKRs. Every paid subscriber also gets unlimited OKR coaching to ensure your team has the best introduction to OKRs.👈
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To motivate you, even more, to throw out the idea of Personal OKRs and focus on the Team OKRs instead, here’s another saying from a man who definitely knows what he is talking about:
Great things in business are never done by one person; they’re done by a team of people.Steve Jobs