Are you moving forward?
Have you gauged all the resolutions you made at the start-up? Have you achieved them? Did you check which strategy was effective? Have you achieved the expected results of your efforts?
Revising your overall performance is necessary when measuring what you have progressed throughout the year. However, it’s the exact time to move forward. If you have a solid grip over tech and marketing, you must have heard about the term KPIs. And if you’ve operated helpful search engines like Google, you are more likely to be familiar with OKR. But in case you don’t know, it’s alright.
The marketing and tech world is crowded with such acronyms, so keeping everything over the table may be difficult.
Here we bring out all the OKR Vs. KPIs discussion. However, these two things are completely different but still overlapping acronyms.
Let’s first discuss the KPI.
What are KPIs?
KPIs are abbreviated as Key Performance Indicators, and this acronym evaluates the achievements of particular initiatives or the whole organization. These performance metrics can implement in various initiatives, programs, projects, and other strategies. They can gauge the progress of anything in the organization, from sales goals to social media metrics.
Companies tend to adopt KPIs from other successful companies to check out why their goals are never achieved. Nevertheless, individuality occurs in different employees of the same organization; in the same way, every organization is individual. KPIs should customize according to the organization’s goals, a pattern of achieving them, and the person who can act on this concept.
Example of KPIs
There are plenty of examples of KPIs in an industry. But make sure that even if you are running a small company, Your KPIs should be split into departments.
- Retail industry: it includes sales per worker, same-store sales, and revenue for one square foot
- Sales department: KPIs like revenue, customer lifetime value, and calls made are included.
- HR department measures the employee’s performance, average recruitment time, and attrition rates.
- Technology industry: in this department, KPIs check the monthly recurring revenue, ticket resolution time, and user retention.
- Healthcare industry: it may include measuring the patient wait time, frequency of educational programs, and average treatment charges.
What is OKR?
This acronym stands for Objectives and Results, which can be described as a benchmark that highlights the “company’s objectives” and the measure of the “results” that are characterized by the progress of each goal. OKR represents the quantitative way of achieving aggressive goals. They’re deployed to quarterly objectives but can also be used for annual planning. The emerging technique of OKR is entirely credited to little search engines like Intel and Google, which deploy this acronym for their annual planning. Moreover, renowned companies like Spotify, Amazon, and LinkedIn are now using this framework for their goal management.
In short, OKR is simply a framework where KPIs are weighed within the framework.
Example of OKRs
OKR is a framework built on giant objectives that motivate workers and companies ahead so that they can touch the boundary of the “impossible .”It can be established as an individual, the team of an industrial level. Here we’ll take some goals and achieve them with the OKRs framework.
Goal: become a market leader in an industry
Result no 1: record $100 in profits
Result no 2: increase frequency of employees by 45%
Result no 3: increase market capital adequately to enter S&P 500.
Which one is best for your company? OKRs VS. KPIs
Generally speaking, in the case of OKR vs. KPIs, the latter can prove the best fit for your company since it aggressively focuses on growth. But some companies’ KPIs often generated the same outcomes as the key result obtained in the OKR framework. So make your vision clear by reading following our lines.
OKRs VS. KPIs
- KPIs usually indicate measuring strategic goals
- A quantitative measurement (can be qualitative in rare cases) of the company’s objectives
- It directs where to focus assets
- Be gauged against objectives and targets
- An always quantifiable approach toward tracking achievements
- It can able to be objectively sacred on a 0-100 of 0-10 scale
- An ambitious approach
Make the best use of KPIs and OKRs
When it is about KPIs, maintain them to a minimum, ensure that they are attainable, make them clear, deploy a software reporting tool to track efficiently, and track each single performance indicator with a spreadsheet. Moreover, frequently reporting and updating KPIs make your objective clear.
While for OKRs, take initiatives with specific goals, and ensure the support of executives. Also, deploy reporting software to simplify the tracking and implementation.
In the case of comparing OKRs Vs. KPIs, we have to bring some real-world examples. In the OKR example mentioned above, a key Result was to increase the worker’s strength by 45 percent, so counting the number of workers can be a KPI. While on the other hand, the OKR framework is simply an approach to tracking the data.
Remember that one is a key result while the other is a measurement technique, this term can intersect, but the user can’t be. So, choose the right approach for accomplishing the goals of your organization.