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You’ve most likely heard the terms before, but what’s the difference between them? OKR stands for objectives and key results. The OKR process begins with an objective (O) and three to four key results (KR). KPI (Key Performance Indicators) indicates performance, just as the name entails, and a handful of them make up a scorecard.

There are two types of key results: outcomebased and efforts effortsbased. The outcomebased is often quantifiable, whereas the efforts effortsbased is a project or initiative. KRs can be outputs or activities.

A KPI is equivalent to an output. Think of it like this; : a KPI is an objective outcome of some effort. Your KPIs can be your quantifiable or outcomebased key results.

Using our example, the objective, “create wildly loyal customers,” has four key results. The first two key results are also KPIs because they fall under the scope of being either quantifiable or an outcome of some effort.

OKRs and KPIs share similarities, and it’s often more advantageous to think of them working together rather than being two separate processes. When setting up OKRs in your organization, you’ll often find a handful of KPIs among your key results. Now that you understand the difference between OKR and KPI, you can effectively utilize their benefits in strategic planning for your organization.

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