The Challenge

One of the significant challenges organizations face today is spending 80% of their time in the business, and only
20% spend time on the business. To overcome this challenge, organizations must strategically plan, leveraging the
power of OKRs and KPIs, thus reaching the planned internal and external performance.

The Challenge

OKRs vs. KPIs

Basis of Distinction
Type
Type
State of Affairs
State of Affairs
Framework
Framework
Indicators
Indicators
Count
Count
Evaluation
Evaluation
Reporting Format
Reporting Format
Approach
Approach
Examples
Examples
OKRs

More strategic

Ensure teams are well-aligned and consistently improving their performance.

A stronger relationship to strategic performance and growth.

In OKRs, key results show lag and lead indicators.

OKRs encourage a focus on 3-5 objectives with key results.

OKRs are open to evaluation and course correction weekly or fortnightly via check-in meetings.

OKRs help synchronize and align all goals into the same format to report their progress.

Challenges everyone to think about measurable outcomes.

OKR Examples
Objective: Improve customer churn rate to strengthen customer success within the organization
  • Key Result 1: 6% customer churn rate improved from 10%
  • Key Result 2: 90% of customers left positive reviews improved from 80%
  • Key Result 3: 90% of project plans delivered on time improved from 85%
KPIs

More operational

Ensure maintenance of a consistent state against benchmarks.

A stronger relationship with performance evaluation and management.

Typically, the focus is on lag indicators.

There is no restriction on the number of KPIs you can have.

KPIs can be evaluated during performance review cycles, often annually, and relate to compensation.

There are multiple reporting formats to report progress on different KPIs.

Measure inputs or activities. KPIs follow an output-based approach.

KPI Examples
  • 100% accomplishment of assigned tasks
  • Never below a three on a customer survey
  • Less than six call outs
  • Manage a client load of up to 10

OKRs and KPIs
Complement Each Other

KPI = The KR Component in OKR

KPI = The KR
Component in OKR

Organizations have been widely using KPIs or business metrics, much before OKRs, to reflect upon their performance. KPIs add a system of measurement to your current projects and processes. You learn what must be analyzed to determine the fundamentals for your OKRs.

OKR

OKR

Innovation and improvement are the prime focus for organizations with a long-term vision, striving for accelerated strategic performance. Such organizations practice OKRs to set and align their business objectives. Most successful companies, such as Amazon, Google, Microsoft, Netflix, Adobe, Oracle, and LinkedIn, share fantastic relationships with OKRs. Intel credits its survival to OKRs, winning the microprocessor war against Motorola.

OKR + KPI

OKR + KPI

High-growth organizations with a hawk’s eye on results leverage KPIs and OKRs to produce the best possible business outcomes. They use KPIs to monitor performance and recognize issues and areas for improvement, while OKRs solve these problems, facilitate processes, and drive innovation.

Let’s say your marketing team has a baseline KPI of 7% overall website conversion rate. If this website conversion rate falls below 7%, the marketing team may face a difficult conversation on their performance regarding meeting the baseline metric, 7% here. Teams more aware and aligned to the business growth goals would already focus on improving the website conversion rate over the quarter.

Steps on How to Make OKRs
and KPIs Work Together

Ensure each role in your organization has a baseline performance scorecard for their job and utilize these as KPIs. These are metrics that spark meaningful employment conversations regarding the overall organizational performance.

Once everyone is clear on their job performance metrics, individuals gather as teams to discuss where and how the team makes the most significant contributions to the company’s OKRs. You write your intent and metrics of success as a team. OKRs are all about the positive change in your business’s vision and strategic priorities.

Next, create a common place for all OKRs to be tracked to ensure transparency across teams and levels. Overall, we suggest updating metrics weekly and syncing with your team to resolve blockers (if any) readily.

Once you have this standard tracking process, you can assess your and others’ OKRs achievement at any time throughout the quarter to ensure you are on track. Overall, this helps all teams and individuals focus and align with the overall business objectives. OKRs give them the transparency to cross-collaborate and gain resources when needed. Organizations with this level of alignment and transparency grow 58% faster revenue and are 72% more profitable.

See how KPIs and OKRs work together

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OKR + KPI in Unlock:OKR

Accelerate your ability to visualize how everyone contributes to the organization’s objective and strengthen relationships between people and teams in accomplishing a bigger vision and mission. Here’s a bird's-eye view of Unlock:OKR Dashboard.

Note: KPIs can focus on achievement when it comes to performance review time, while OKRs can discuss engagement in your strategic planning process vs. specific OKR achievement.

Remember, “Key” is vital in KPIs and OKRs, so the safest bet is to focus on a few metrics and goals.

OKR + KPI in Unlock:OKR

New to OKRs?

Jessica Brown

“Everyone has a role in an organization. Often, most people work in the business, and not enough work on the business. Accelerate strategic performance by combining OKRs with KPIs. OKRs help teams and individuals understand how they contribute to the organization’s future and strategy, not just operations. When people are focused and aligned, organizations achieve exponential results more than ever before.”

Jessica Brown

AVP, Workforce Performance, Unlock:OKR

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