KPIs vs OKRs

Key Performance Indicators (KPIs) and Objectives and Key Results (OKRs) are both tools that big businesses use in strategic planning and execution. They’re also great tools for small-to-medium business to use to compete and perform like the big dogs. Let’s take a look at the similarities and differences and get a handle on why you need both.

	Key Performance Indicators	Objectives and Key Results
Structure	List of measures & metrics	List of overarching goals and. for each, indicators of success
Data	Numeric/quantifiable	Quantifiable and Activities/achievements defining success
Orientation	Roll up from teams and departments to central management	Bi-directional alignment. In smaller companies, tend to be management-driven.
Timing*	Current & Past Performance	Forward-Looking
Role/Use*	Operational Management / Execution; Check performance	Strategic Planning & Forward Management
Redefinition Frequency	Infrequent – Annually or every few years.	Frequently – Every quarter, or at least every year.
Core Purpose*	Guide Daily Execution	Drive Dynamic Change & Improvement

If you walk down the table above and compare and contrast each point, you should have a really good idea of the purpose and use of KPIs vs. OKRs and when to use each.

What About That Pesky Asterisk*

There’s just one catch. I have high expectations of myself and my clients. I don’t use Key Performance Indicators quite the way they’re intended. What’s the fun in that!

There are three items in the chart above that have asterisks:

1. Timing
2. Role/Use
3. Core Purpose

Because I have my clients go beyond identifying KPIs to also define a Performance Budget, in the Pivot Habit method, KPIs become:

1. Timing – Past performance, current performance, and forward looking.
2. Role/Use – Strategic & Forward management as well as execution management.
3. Core Purpose – Driving dynamic change as well as guiding daily execution.

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