OKR is the acronym for objective and key results; more specifically, an objective is linked to key results. The OKR is a strategic framework, while KPIs are measures that exist within a framework. OKR is a simplistic, black-and-white approach that uses specific metrics to track the achievement of a goal. OKRs are not business performance metrics, but KPIs.
The goal of OKRs is to decide what exactly you need to improve in your company and, based on that, how you will use your time and resources over the next 3 months. OKRs focus on the short term, so it's as much about saying “no” to opportunities as it is about taking advantage of them. Business OKRs are used to communicate desired results across the organization, focus attention on key areas for improvement, and deliver valuable results for the company. While KPIs are great for measuring continuous performance and operational efficiency, OKRs allow organizations to set ambitious goals, track and achieve them.
KPIs help monitor performance and identify problems and areas for improvement; OKRs help solve problems, improve processes, and drive innovation. Add KPIs and OKRs to Weekdone to manage, track and evaluate the company's performance, improvement and progress. The simplest explanation for the difference between OKRs and KPIs is that OKRs express what your organization needs to achieve and how it will achieve it, and KPIs describe how you will measure success based on the most important measures in your plan. And while KPIs are often considered BAU, there are times when KPIs can inform and even become OKRs if it's a measure that you want to change significantly.
OKRs are a framework for developing your plan and strategic actions, and KPIs describe the measurement of that framework. So, if the OKR you established this quarter didn't affect the company in the way you expected, you can analyze what worked and what didn't, and come up with a better approach and a better OKR for the team for the next quarter. The difference between OKRs and KPIs is that OKRs express what your organization needs to achieve and how you will achieve it, and KPIs describe how you will measure the most important measures of the OKRs in your plan. So, as you move forward with your strategic plan, ask yourself: How can I ensure that my OKRs and KPIs complement each other and work together and not separately? While both OKRs and KPIs are tools used to measure performance and achieve objectives, they have different purposes.
They use OKRs to define what key advances they must make in a particular quarter or year, and they use these same OKRs to measure whether these advances are actually being made. For OKRs to work, it is necessary to define the objective so clearly that it serves as the basis for the reflection process and the prioritization framework for the entire quarter. KPIs and OKRs coexist very well and you should use both frameworks in your company, each with a different purpose. So, if you have key results that are also KPIs, make sure they carry over to the next set of OKRs.