142: Redefining Performance, with Radhika Dutt

What if the performance metrics we've relied on for decades are actually undermining our success? 

Radhika Dutt, entrepreneur, product leader, and author of Radical Product Thinking, challenges conventional leadership wisdom by revealing why traditional goals often backfire and introduces a compassionate approach to leadership through puzzle-setting and puzzle-solving frameworks.

This eye-opening conversation explores how our current performance measurement systems originated from 1940s assembly lines, yet we continue applying them to complex knowledge work with predictably poor results. 

Radhika shares real-world examples from her 25 years of experience, including how companies can appear successful by their metrics right up until they suddenly fail. The culprit? Performance theater, where employees are incentivized to highlight wins and conceal problems, leaving leaders with a dangerous illusion of progress.

The solution: Puzzle-setting and puzzle-solving. 

Rather than asking: What are your goals?, leaders can transform engagement by asking: What puzzles do you want to solve? This simple shift creates psychological safety and genuine enthusiasm. Her practical OHLs framework—Objectives, Hypotheses, and Learnings—provides the structure for implementing this approach without the anxiety of abandoning familiar systems.

Ready to transform how you lead? 

Radhika Dutt is is an entrepreneur, speaker, product leader, and author of Radical Product Thinking: The New Mindset for Innovating Smarter which introduced a methodology now used in over 40 countries. She is also currently Advisor on Product Thinking to the Monetary Authority of Singapore (Singapore’s central bank and financial regulator), and does consulting and training for organizations ranging from high-tech startups to multinationals on building radical products that create a fundamental change. She is now working on her second book, Escaping the Performance Trap: Why Goals and Targets Backfire and What Actually Works.

Download the free OHLs toolkit at radicalproduct.com and start creating a more engaged, transparent, and truly compassionate workplace today.

Go to https://betterhelp.com/resilience or click Notes on Resilience during sign up for 10% off your first month of therapy with my sponsor BetterHelp.

Chapters

• 0:00 Introduction to Compassionate Leadership
• 6:00 From Book Author to Leadership Expert
• 11:00 Why Goals and OKRs Backfire
• 16:16 Puzzle Setting vs. Checkbox Mindset
• 21:49 The OHLs Framework for Better Results
• 27:19 The History of Performance Measurement
• 31:25 Making Change in Small, Manageable Steps

Transcript

Radhika Dutt: 1:14

The more someone feels judged or evaluated, the less open they are to feedback.

Manya Chylinski: 1:23

Hello and welcome to Notes on Resilience. I'm your host, manya Chylinski. My guest today is Radhika Dutt. She is an entrepreneur, a speaker and a product leader, and the author of the book Radical Product Thinking the New Mindset for Innovating Smarter. We talked about how to measure employees' performance, what that has to do with compassion in the workplace. It was an amazing conversation. I know you're going to love it, radhika. I'm so excited that we're finally getting to record this episode.

Radhika Dutt: 2:02

Thank you for having me, Manja. I'm excited to be here.

Manya Chylinski: 2:04

To get us started. What is one thing you have done in any area of your life that you never thought you would do?

Radhika Dutt: 2:12

Okay, well, I never thought I would write a book. What? After all the reading on my English essays in high school, that was one area I thought I would never, ever get into. But here I am. You know, like, there's my radical product thinking book that I. That was published in 2021 by Barrett Kohler, that was published in 2021 by Barrett Kohler. And then now I'm working on my next book, which will come out about a year from now, so end of 2026.

Manya Chylinski: 2:49

First of all, I love when people write books. I'm an avid reader from way back, so I love that you've done that and it's cool that, even though that's not something you saw yourself doing, I think that's really neat.

Radhika Dutt: 2:57

But you know, I think part of why that is is if you feel like something has been said before, then there's no need to say it again. Or at least that's my really high bar for what deserves to be written right, and even in radical product thinking, pretty much every single chapter is offering new information. Someone said to me you know you wrote this book like it was written for people with ADD, that it's a business book and yet it sort of keeps you on your toes and keeps you reading. But my point is, if I felt like this material had been written before, I wouldn't have had a need to write it, because it was not that I was aspiring to be a writer, right.

Manya Chylinski: 3:44

And a lot of people write the book they wish they had the book that they wanted to learn from, and so, yeah, I love that. I love that. I love that. I love that. Okay, so we are talking about compassion and leadership and I love that. You're coming from a slightly different perspective than a lot of my guests, right? And I love that. Your book is called Radical Product Thinking, and I'm actually looking at the cover as you and I are talking. So I'd love to hear what you think about the concept of compassion and leadership and how that ties into what you do, and why is it that you and I are talking today?

Radhika Dutt: 4:24

So, to me, compassion and leadership is often misunderstood. We often, as leaders, think compassion is about being nice, whereas the reality is compassion doesn't mean being nice, whereas the reality is compassion doesn't mean being nice, it's being empathetic and kind. So what I mean in terms of the difference is, you know, if an employee isn't doing well, being nice is not saying anything, and we often think that is what compassion means that we have to be soft and not do anything, not say anything, sort of accommodate, accommodate, right Whereas being kind and being compassionate actually, to me, means that we give them feedback, that we have honest feedback, but at the same time, we're being both empathetic and compassionate. In this case means helping them do better and improve. And so I think, as leaders, while this is all very easy to say and one can sound very trite in saying it, the big question is how do you actually do something like this?

Radhika Dutt: 5:36

And a lot of what I talk about in this book, while I don't talk about it as compassionate leadership, I think, to me really fits with this theme. And so this next book project that I am working on it's about why goals and OKRs, or objectives and key results, is what OKR stands for, but why goals, okrs, targets, why they backfire and what actually works. And to me it challenges a lot of the fundamentals of what leadership means. You know we have thought leadership is about setting goals, driving towards them, and often compassionate leadership is understood as let's be soft, but it's neither of those right.

Manya Chylinski: 6:30

Like. This is my learnings and hard lessons along the last 25 years on what we can do using the word, and you specifically were talking about objectives and key results and how that can backfire, how setting goals can actually not be as beneficial for employees. So what actually works when you are setting boundaries and when, as a business, you need to show results and you need to be treating people like humans?

Radhika Dutt: 7:00

Yeah. So let's talk about what doesn't work, and I want to clarify that it's not just that it doesn't work for employees, but it doesn't work for leaders either. So it's in terms of what doesn't work when you're an employee and you have a target. Let's talk about myself, right, so you give me a target. My incentive is to hit those targets and show you that, look, I hit those targets. I'm a high performer, right? And so my incentive is to show you, ta-da, those targets are hit.

Radhika Dutt: 7:30

But the reality is, perhaps some of the bad numbers, I've swept them under the rug, and it is not out of maliciousness that I might be doing this, you know. It might also be just the subconscious that I don't want to see the bad numbers, that I want to see the progress, because you know you too want to see progress as a leader. And so it's not good for employees, in that I am learning to just sweep the bad numbers aside, not look at them, focus on the good numbers, to say, ta-da, I've hit the numbers. But it's also bad for leaders, because, as a leader, you have this illusion of progress. You're seeing people show you numbers. What's happening under the hood? You're missing those details, so it's like having a car where you're taking a turn and your shock absorbers are so soft that you really don't have a feel for the road, and so you're taking a turn without knowing how fast you can really go. So that's really what goes wrong in terms of goals and OKRs. Right, and the solution to this is, instead of setting targets, which gets us to mostly show ta-da, everything's working well, it's to work on puzzle setting and puzzle solving.

Radhika Dutt: 8:45

So let's take a concrete example, and I'll give you an example from back in the day when I was working at a company called Avid. So Avid was a company where we dominated the movie industry in terms of editing. So every Oscar-winning movie made was edited using Avid's video editors and our products. So, in fact, if you waited until movie credits, you would see Avid's logo at the end. So that was the setting, and our numbers looked fantastic. We had targets for the Hollywood industry and that part of our business, and we were hitting targets. Right, we were consistently hitting targets. But if you just dug under the hood a little bit and looked at what these numbers were actually showing you, it turned out that our low-end market and the mid-tier market was being eroded by Apple and Adobe, and the way we were still hitting numbers was continuously going further up into the high-end niche, and so it worked until it didn't.

Radhika Dutt: 9:47

And this is what we see in a lot of companies. When you're doing sales, you see everyone scrambling at the end of the quarter, trying to make the quarter's numbers and figuring out what numbers can I pull in from the next quarter? Right, and that works until it stops working. So what is needed instead is to ask early enough, what are these numbers actually saying? Let's figure out the bad numbers early enough so that we can figure out what's going wrong in the market, have those early warning signs, so that we can take corrective action, so that it's not that it stops working. And then we figure out oh, now what do we do?

Manya Chylinski: 10:34

So, like you use the word puzzle, so you're looking at it more as a puzzle. And what are the pieces that go together versus? I'm not going to be great at this analogy, but sort of this straight line and we're just checking off boxes as we go down the line, which is a horribly mixed metaphor.

Radhika Dutt: 10:51

Okay, but it's actually a brilliant metaphor because that's exactly what happens. You know OKRs and goals. They make you sort of go down checkboxes and the reality is that your market is like a puzzle, and so the parallel you were drawing was exactly right. It's a mindset of checkboxes versus a puzzle setting and puzzle solving mindset, and we can go into kind of what that means, right.

Manya Chylinski: 11:17

And so well. First of all, thank you for saying that. That's how it read in my mind. Puzzle, I mean, that gets at the heart of an organization that has some level of compassion, that has the employee's trust and feel safe.

Radhika Dutt: 11:53

Very much so. And speaking of compassion, right, just put yourself in those shoes where you, as a leader, you're asking your employee what are your goals for this year, and compassion would mean, like, just imagine instead of asking, or instead of you being asked, what are your goals for this year. If I asked you, manya, what are some puzzles you want to solve for your business this year? Like instantly it puts you in a different mindset. Right, there's this excitement about solving puzzles. So when you're a high performer in a company, puzzle setting and puzzle solving is like catnip for you as opposed to the performance theater that goes around in terms of you know, everyone is showing various numbers and if you know the reality under those numbers, that's discouraging because you know the reality under those numbers. That's discouraging because you see someone being rewarded for numbers, for showing numbers but not revealing the reality. That is all soul-starving, right? And compassion means being able to give your team enough direction so that you can say you know, here are the numbers I need you to hit in terms of sales. Right, I'm not lying to you, I'm not setting false expectations. I'm telling you this is what we need to do, but there is a puzzle element to it. And the puzzle element is I genuinely don't know how we get to this number, because what I've seen is in the last three years, sales were growing, but they have stalled now and I don't know kind of how to solve this. Here are some questions I have in my mind. There might be questions, guiding questions like is it that the market has changed? Is it that we maybe were really good at selling to that early adopter but we haven't figured out how to sell to the mass market? Is it that we've fallen behind versus our competitors who really leapfrogged us, you know so therefore, maybe our product isn't doing what it needs to for the mass market. So there are questions here that I might have as a leader, and the compassionate part is being able to frame this as a puzzle where you're welcoming feedback from your team and once you've set this puzzle, along with your expectations for solving it, then going into both this puzzle setting and the puzzle solving Even in this puzzle solving, compassion means recognizing that different people in your team have different levels of capabilities, so one size doesn't fit all.

Radhika Dutt: 14:23

So what you really need is scaffolding for your team. So in the puzzle solving, scaffolding this methodology that I talk about in this new book project. It's called OHLs Objectives, hypotheses and Learnings. So the objectives part was the puzzle setting that I just talked about, right when that puzzle setting was. In this case, the objective was this is our sales goal for the year and this is the puzzle we need to solve to be able to get to this number.

Radhika Dutt: 14:51

The second part of this is the puzzle solving part, and that means asking three questions. The first one is how well did it work? So, unlike OKRs or goals, where you're asking did you or didn't you achieve this target, what you're asking is how well did it work right? So you want the good and the bad and this is where you define what is your hypothesis. So if we try this experiment, then I expect to see this result, because here's the connection and here are the leading and lagging indicators I'm going to measure. So I am creating some clarity around my first question of how well did it work. So that's the first question, along with some details so that I really have clarity on how well did it work Right.

Radhika Dutt: 15:37

The second question is what did we learn?

Radhika Dutt: 15:40

And so this is where I say to teams don't just give me a bunch of stats like.

Radhika Dutt: 15:45

Here's the weekly active users, the churn rate, the bounce rate, blah, blah.

Radhika Dutt: 15:50

Stop for a second. Tell me the story, look at the numbers, figure out what have you truly learned from all of this and tell me the story. And this triggers the creative thinking and puzzle solving right. And this triggers the creative thinking and puzzle solving right. And then comes the third question, which is based on how well it worked and based on your learnings what will you try next, meaning if I were to give you a magic wand, what will you ask for? And the third question is really again this aha moment of creative problem solving, where all of this comes together and, based on your learnings, you're planning your next action. And so this is the objectives, hypothesis and learnings model and the scaffolding you're creating. And so, going back to the point about scaffolding, it's that when you have different competencies in your organization, it's not easy to just delegate without knowing how well can someone take your delegation, and so compassionate leadership means you're offering this sort of scaffolding, and to different people I'm able to offer different levels of freedom versus handholding.

Manya Chylinski: 16:59

Yes, yes, yes, yes To all of what just said. This is, I love it. You started out by mentioning that a lot of what happens now is theater is and I'm thinking back to a job I had where you were going to be rated and you were given a number and only so many people could get each number. So if a few people got a five, no matter how great you were, you could never get a five, and I remember how demotivating that was.

Manya Chylinski: 18:03

And there was a whole incident in my own career where I had a five and I was told by somebody that I had a five and that in the meeting they decided I needed to get a four because of something that happened and very complex.

Manya Chylinski: 18:19

And the thing that took me from the five to the four wasn't even a work-related thing, and it was just the whole. I decided I don't want to work in an environment like this because we're not getting to be our own selves. And then I have to follow up with you and I are doing a podcast. You are not my manager, you do not direct me in my work life, but when you asked me, what puzzle do I want to solve? What puzzle do I want to solve, my brain started firing Like, yes, what puzzle do I want to solve? So I can say that it feels like that is a great thing to do in the work environment and the compassionate piece is it treats me as an individual human with, as you were saying, different strengths, different abilities and different desires of what I want to focus on.

Radhika Dutt: 19:21

That is brilliant. So many insights here I want to respond to. Okay, let's start with the performance measurement part. Right, it's really interesting. I had a manager talk to me just the other day. She was saying to me you know, so I'm using this approach of puzzle solving with my new hire, but I also want to figure out how do I evaluate them, how do I give them rankings? So what you said really makes me come back to this, because we keep coming back to this question of needing to rank people, quantify their performance, and when you step back for a moment, you have to ask the question why do we need to quantify performance? Why is that? Why do you need to give ratings?

Radhika Dutt: 19:59

And if we're realistic and honest about the answer, it's because when there are layoffs, you want to be able to say, okay, let's fire the bottom 10%, and quantification helps you do that. Right, that is like designing an entire vacation as if you're planning for a hospital stay. You're you're planning everything for the worst case scenario, like that ruins your trip. If you're packing your entire stay as if I'm going to the hospital, like, why would we do that? It demotivates people and you're not getting the best performance, you're not harnessing their skills by constantly doing this quantification and you know what research shows as well is, the more someone feels judged or evaluated, the less open they are to feedback. And let's just even think about you know running performance reviews and how this plays out when someone is feeling evaluated and then you give them feedback and you say I think you could be doing this better. This is what I've noticed in the last meeting. You know, here's what you did and I'd like you to do this better. Your instant reaction if you know about this four versus five rating, you're going to debate the details with me Like yes, yes, hold on, but in that meeting, this and this happened. So this is being a bit unfair if you're gonna hold that against me and if we just set aside all of those numbers and performance evaluations.

Radhika Dutt: 21:40

What you really want in compassionate leadership is you wanna develop someone's performance. You wanna get the most out of someone's performance. But the answer to that is not by constantly giving them ratings and numbers. It's by developing them. And the way you do that is by giving them constant feedback. And how do you give them feedback that will stick? By not making them feel evaluated. If I genuinely am on your side and make you feel like I'm on your side, you're going to be open to my feedback, because I'm not trying to hold you back from that five. I'm not trying to give you a four. We are constantly working on what will keep improving you. Again, that part of this constant learning is like catnip. I thrive on that learning. I think we all thrive on learning solving puzzles. So why kill that by creating evaluations and making you feel like crap because you're a four even though you're a five Right?

Manya Chylinski: 22:37

exactly. How did we get to this place. Can you fix it, radhika?

Radhika Dutt: 22:44

please. I love this question, manya, because I was also looking at how did we get here? And I think the history of this is fascinating, because OKRs and every time we repackage goal setting under a different name we think that this is a new concept, like hooray, this is the next solution. Okrs were evangelized in 2018 by John Doerr and Larry Page from Google, and they made it seem like this was the success or the secret behind Google's success, and so we think, aha, you know, this is a new thing, this is what we should follow.

Radhika Dutt: 23:22

But let's look at where did OKRs come from? They came from Andy Grove at Intel, and so then we look at OK, where did Andy Grove at Intel in the 80s get OKRs? Well, he modified a little bit what Peter Drucker came up with in the 1940s, little bit what Peter Drucker came up with in the 1940s. And what did he come up with in the 1940s? What problem was he solving? He was working with General Motors, and the problem that General Motors had was how do we drive better performance in our workforce, which was primarily working on assembly lines with little automation, low skill labor that was working on repetitive tasks, and so what Peter Drucker said at the time was revolutionary. He said well, instead of command and control, let's set targets together with employees, and then we can measure them against it. And it makes sense, right? Because in that sort of an assembly line setting where there's one right way to install tires, I can say Andy is definitively a better performer than Bob because he installed 45 tires whereas Bob did 40. And that's an easy way of measuring how someone is performing and who's a high performer.

Radhika Dutt: 24:40

Now I take the same way and I use the context of today's workforce, where it's mostly skilled labor. So let's look at even the manufacturing sector and look at the Boeing example and say you know what happens when you set production targets in a place like Boeing, where you need skilled labor using their skills to manufacture an airplane, and you see the sort of quality issues Boeing has had with, you know, airplanes, panels flying off, for example. And that's the kind of disaster you get when you set goals and targets. And it gets even worse Well, no, not technically worse, because there are fatalities associated with all of Boeing's errors, but it does look equally bad when you apply the problem of how do you measure performance in academia, for example, and you say I'm going to measure researchers by the number of papers they publish, and then you see the kind of falsified data you get crappy papers and just the toxic environment.

Manya Chylinski: 25:41

Wow, okay, so that's how we got here. So you answered my question, and it is interesting to think that these measurements and the way we were looking at employees comes from a completely different era and a completely different kind of work than many of us do, and a completely even if we're doing a similar kind of work than many of us do, and completely even if we're doing a similar kind of work on the factory floor, the environment now is still so different, and it makes sense. There certainly are some jobs where somebody who does 45 versus somebody who does 40 of them is objectively doing more, but that is not true for a lot of the knowledge workers, which is where a lot of us fall these days. Why are we so slow to change? And, as you were talking, the other question that popped into my head is why are we so slow to remember that we're talking about and we're working with humans?

Radhika Dutt: 26:43

I think the answer to this lies in the fact that when ideas are so entrenched in us, when we've been told all our lives that goal setting is how we achieve success or how we achieve results, we never go back to questioning wait, why is that? And so I think change is hard, and this is why I want to empathize with leaders. That change is hard. Like, how do you change your mindset when something is so deeply ingrained in you? And there's the second aspect of it when this is what you have known for so long. Telling a leader listen, just stop using goals is kind of like saying you know I want you to step into this dark abyss, not knowing kind of what's going to happen next. Just trust me on this one.

Radhika Dutt: 27:33

And the thing is right, as I was observing these issues with goals and OKRs, I tried this with leaders and I can tell you it does not work to tell them to step into such an abyss, just telling leaders that goals and OKRs don't work. Until now, there was no chance that that could work, because that is like telling them to abandon the only thing they know. It's the devil they know. And so what do I do instead? And until the last year, I didn't have a good answer to what do you do instead, right, and this is where, in this last year, I've been able to use this framework of puzzle setting and puzzle solving. I've been able to test it with people, figure out what's working well, what requires more work and scaffolding and help, and how do we bring about this change in mindset very systematically so that it doesn't feel like a huge and scary change. And so I think that's really what holds us back right. When change is so big, so scary, how do we bring it about slowly and in a guided way?

Manya Chylinski: 28:42

Yes, and I think about change management and the concept of change a lot as well, and the fact that even when we know it's a good change and even when we want to change, it is still very difficult.

Manya Chylinski: 28:57

So we're fighting against human nature in wanting to make some of these changes, but I think you and I and people like us are chipping away this. We're helping people bring more compassion into the workplace, treat people like humans, make some of these changes, maybe small steps, and I think we're on the right track. I'm loving this conversation, radhika, and I wish we could go on, but we are very close to the end of our time. I would love you to wrap us up with a final thought.

Radhika Dutt: 29:33

I want to go back to your point about bringing about that change slowly, and how do you do that? In small steps. So maybe my final thought is that to bring this into your organization, you know, you don't even have to take this big step of let's just, you know, from one day to the next, forget goals and OKRs, let's take this change slowly. The way I've done this is, you know, if you're a leader present to your team, an initiative in this format of how well did it work? What have we learned, what are we going to do next? You know, be a vulnerable leader and compassion starts there. Where you can share learnings in this way, so that you can expect your team to also share information with you in this way, where they share good and bad information, so you get the real sense of what's happening on the ground, what they're learning, what they're going to do next. You'll see that it gives you a better way to course correct, because you have all the information that you really need to make those decisions. That's the first thing that you can introduce this by role modeling, this learning. You can ask your team to start to present information to you in monthly business reviews in this way, and so as you start doing this, you start to normalize this way of thinking. It becomes a mindset. You know you're not adding just more processes for the sake thereof, okrs or goal setting, et cetera.

Radhika Dutt: 30:58

There's a lot of burden with it. You know it's all about tracking details, that we green or red on all of this, but instead there's a lot of burden with it. You know it's all about tracking details. Are we green or red on all of this? But instead this is a way of thinking, a way for people to communicate how well things are working, what they've learned, what they're going to do next, and it's a constant way of being able to understand what's going on, give people feedback, and just in time feedback. So it's useful. So that's really the crux of it. And the final thought is to be able to do all of this. You can download the free template that I have. It's on radicalproductcom. If you go to toolkits, you'll see the OHL's toolkit that you can download for free.

Manya Chylinski: 31:37

Oh wonderful. Thank you so much. We will put a link to that in the show notes.

Radhika Dutt: 31:46

And what is giving you hope these days? What gives me hope is really the human connection, which is what I love about your podcast. In a lot of the work that I've done, people ask me you know, what is it like to write a book etc. Or what has it been like since you published the book? And for me the biggest satisfaction is when people reach out to me sharing kind of how much of a change it has made for them, or the difference that it's made to be able to apply it even in their personal lives, not just in their work. And so that was sort of what really brought me satisfaction from radical product thinking. It was those human connections, the feeling that I have made a difference at that one-on-one level, as opposed to just how we sometimes tend to want to measure impact in this way, where we feel like, oh you know, I've released a product that has hit millions of people, but it's not that that makes the real difference. It's that human connection.

Manya Chylinski: 32:43

Absolutely, radhika. Thank you so much, I so enjoyed our conversation.

Radhika Dutt: 32:48

Likewise, Manya, and thank you so much for all of your questions. I've really enjoyed talking to you.

Manya Chylinski: 32:52

Excellent, and thank you to our listeners for tuning into this episode of Notes on Resilience. We will catch you next time.