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Difference between OKR and KPI
KPI is an abbreviation for "key performance indicator," which is a measurement that affects an organization's actions. Virtually every company uses KPIs throughout the globe. However, it's very uncommon for key performance indicators to be abandoned once a company or team grows. As a result, many business leaders have turned to a technique called Objectives and Key Results (OKRs) to assist them to stay on track. It's like comparing apples and oranges by contrasting KPIs and OKRs. Evaluation meetings often include these phrases. While there may be some overlap between the two methods, they serve quite different ends.
What is KPI?
Key Performance Indicators (KPI) are metrics used to understand better how to make performance measurements operate. As the name implies, KPIs are quantitative indicators or values used to assess an individual's or organization's progress toward certain goals. The goal of key performance indicators (KPIs) is to determine the critical measurements that may be utilized to influence corporate behavior.
For example, suppose you're a YouTuber. In that case, some of the main measures driving your growth or performance level include the number of subscribers, revenue generated, views per post, or minutes per post. So, they are all performance measurements that determine your performance and progress. These crucial values indicate how near you are to reaching your objectives. Through a measuring system, key performance indicators let you maintain track of your job.
What is OKR?
OKR stands for "Objectives and Key Results," which are management concepts. This term means when used as a framework or a goal-setting instrument that individuals or groups may employ to achieve meaningful ends. When achieving your goals, OKR is about instituting a lasting shift in performance. It's a system for group work that measures progress toward goals in terms of concrete indicators.
Companies like Intel and Google have used OKRs extensively, and their success in achieving their goals and developing into great places to work is largely attributable to this strategy. As their name indicates, OKRs use objectives and key results to formulate aims; objectives reveal the desired destination, while key results specify the actions to get it.
The objectives and the means by the key results represent the end goal. OKRs were first developed in the 1970s by the late Andy Grove, former CEO of Intel, but they didn't become well known until 1999 when they were introduced by the famous venture capitalist John Doerr at Google. Objectives and Key Results (or OKRs) go by both names.
Differences − OKRs and KPIs
The following table highlights how OKRs are different from KPIs −
| Characteristics | OKRs | KPIs |
|---|---|---|
Full form |
OKRs stand for Objectives, and Key Results Structure |
KPIs stand for Key Performance Indicators |
Meaning |
OKR is a framework for collaborative goal-setting that individuals and teams may utilize to accomplish their objectives. |
Key performance indicators, or KPIs, are measurable values used to measure an individual's or organization's progress toward particular intended goals. |
Purpose |
OKR is a technique for goal-setting that views organizational objectives as inspirational goals that the firm wishes to attain with quantifiable outcomes. The Office of Key Results developed OKR. |
Key performance indicators (KPIs) are a type of performance indicator that, via a measuring system, assist you in keeping track of your job. |
Uses |
OKRs describes the process that may directly affect and provides the framework for doing so. |
KPIs are used to measure results and, most of the time, cannot be used to change those results actively. |
Function |
OKR is a navigation method for reaching desired objectives specified for either an organization or an individual. |
A key performance indicator, or KPI, is a type of health measure that assists in monitoring an organization's performance and advancement. |
Conclusion
KPIs are health measures that assist monitor the performance of existing operations, processes, projects, etc., whereas OKR is a goal-setting tool that considers organizational objectives as inspirational goals that the firm wishes to attain with quantifiable outcomes. OKR evaluates these targets in light of the KPIs set by the business (KPIs). The OKR will direct you toward the bigger picture that the objectives hint to.
Simply put, key performance indicators (KPIs) define the "what," whereas objectives and key results (OKRs) define the "what," the "how," and the "when." In contrast to KPI, which emphasizes documenting results in qualitative terms, OKR centers on the process itself.
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