OKRs & Performance Reviews

A common question when rolling-out OKRs in any organization is whether you should tie OKRs to performance reviews and compensation conversations.

OKRs and compensation?

The arguments for the separation of OKRs and an individual’s performance review and compensation discussions are that:
  • They encourage low-balling Key Result targets - OKRs by design are meant to be hard and a stretch.
  • Accomplishments might also be exaggerated in the pursuit of compensation.
  • Team OKRs are just that, team OKRs and anything that discourages teamwork and encourages individualism should be prevented.
  • OKRs are not meant to target everything, In fact, focusing your resources on only the most important OKRs is encouraged, which means you’re missing out on a lot of what teams and individuals do and achieve.
  • OKRs are what you want to achieve and Initiatives are the projects and tasks that achieve them - most effort and learning happens on Initiatives not Objective and Key Results.
  • Not everyone has OKRs in all standard time periods, for example, Quarters, but they are spending their time working on Initiatives.
Asking a manager to work through this rats nest of complexity is asking a lot. And any conclusion reached is likely to be subjective not objective.

Yet, OKRs are a key part of how a company and teams decide on what success looks like. So it would be natural to have some coupling, but loose coupling is best.

So how do you create a simple, fair and more well rounded view of an individual’s performance?
  • It should not be possible to set easy to achieve OKRs. Both OKR training, team collaboration and manager sign-off should prevent this from happening - ambition should be a given, and cultural.
  • So should engagement with OKR processes like weekly check ins, review meetings and Initiative learning capture.

The conversation then becomes about recognizing ownership, contributions, behaviour and personal development.

  • Recognize what an individual has owned or collaborated on, whether a SMART goal / KPI, OKRs, a single Key Result, or Initiatives.. Understand that the progress made is likely to be impacted by many other factors - factors like their colleagues, suppliers, business and team prioritization and more. Of course the factors holding an employee back should have been captured as part of the weekly check-in process.
  • Recognize the Initiative ideas people have had to help achieve Objectives and Key Results, recognize the Initiatives they took ownership of, and what they learned during a period.
  • Recognize peer feedback for being culturally aligned with values and behaviours, like being great in teams, taking ownership, problem solving and being kind are great inputs.
  • Recognize an individual's state of wellbeing, for example are they feeling heard, disconnected or stressed?
  • Focus conversations on personal development planning and wellbeing, not performance and remuneration - it’s a bigger and better conversation. Personal Development Planning means writing a plan and setting Quarterly Personal OKRs for just a manager and an employee to see - these should be based on how an employee wants to develop and how the organizations would like them to develop.
  • People naturally care about remuneration conversations so make it clear that these conversations happen separately and are based on a range of factors like continual professional development, team and company achievements, cultural alignment, and local market salaries.
ZOKRI is OKR software that allows leadership teams to recognize contributions via OKRs and Initiatives, behaviour and personal development.

It’s a platform that allows:
  • Company, team and personal OKRs and Initiatives to be set and referenced easily.
  • Check-ins and team meeting agendas to focus on surfacing and sharing what is holding people back.
  • Culture to be defined and aligned behaviors recognised.
  • Initiative ideas and learnings to be captured and recognized.
  • Personal Development Plans to be agreed and kept track of, Quarter-to-Quarter.
So if you would like to get OKRs embedded and recognize and develop your people, choose ZOKRI.