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Article : Leveraging OKRs And KPIs To Enhance Employee Performance


Author: Bhagyashree Shreenath, Content specialist, Keka HR

Every organization would love to have an ambitious and enthusiastic workforce who seamlessly perform their functions. As tempting as it sounds, you need to be aware and accept that this might not be the case forever. As human beings, we are flawed and prone to errors occasionally, which means some days your employees may be at their productive best while the other days, they may encounter new hurdles in their path resulting in delayed deliverables.

This is when a Performance Management System comes into the picture, helping you streamline the organizational and individual goals and improve the overall performance of your organization. This will serve your employees as a source to discover their pain areas, improve and monitor their progress graph, making it easier for you to analyze and arrange training programs, as and when required.

However, there are various tools and techniques available when it comes to managing performance. No two performance management systems always look the same. Just as your organization and its culture, your performance management system will be unique and specific to your goals, objectives, and practices. One of the best techniques for enhancing performance is by utilizing KPIs and OKRs in your company. Before knowing how will you actually benefit from it, let's have a look at what these mean.

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What are KPIs?

Key Performance Indicators (KPIs) also known as Key Success Indicators (KSIs), are a set of quantifiable metrics designed to gauge the performance of an individual, organization, process, or activity. KPIs will greatly help your organization define the strategic, operational, and financial achievements against those of other businesses in the same industry. In short, it is your health metric.

Moreover, these KPIs are subject to change according to the team or individuals associated with it. This not just enables you to effectively monitor your employees but also serves as a basis to make data-backed decisions without any bias.

Hence, KPIs can be referred to as the lagging indicators of how successfully your organization is attaining the set goals.

Here are the examples of some most common KPIs used across various departments in an organization:

  • NPS (Net Promoter Score)
  • Employee Turnover Rate
  • CAC (Customer Acquisition Cost)
  • Sales By Region

What are OKRs?

OKR (Objectives and Key Results) is a simple goal management framework that plays a vital role in building specific and measurable strategies ensuring that they redirect you towards achieving those goals.

Objectives are the entities that define where you want to be. They are often kept short and precise. These objectives should be clearly defined and be ambitious in nature as it is the most critical part of this exercise. If you do it rightly, then you will be able to identify immediately whether you have successfully achieved the set objectives or not.

Key Results are the deliverables that define your progress towards attaining the set goals. Each of your objectives should be accompanied by two to five key results which are easily measurable.

These greatly benefit your organization with its transparent nature and help align goals through all levels and departments to ensure everyone is aligned with a common goal. It facilitates efficiency and effectiveness in the process and builds a strong goal-management framework.

How are KPIs Different From OKRs?

Now that you are very well aware of what OKRs and KPIs actually mean, the next question that may come to your mind is, how are they different from each other? Or should they be referred to as similar entities?

While it is true that they do have some similarities, it is also evident that there are considerable differences between both of them.

One of the key differences in the nature of the function. KPIs are usually attainable metrics that signify the output of a process or activity already in place, while OKRs are aggressive and deal with building a roadmap to achieve the set goals. KPIs are more outcome-oriented, whereas, OKRs are concerned with the process as well.

OKRs are developed with a larger vision in mind – a big picture of what your company is actually trying to achieve, while, KIPs, on the other hand, are created with the intention of scaling or improving a certain project, plan or activity. KPIs are clear and specific in nature. OKRs are more general and only go into specifics with Key Results.

Nonetheless, it solely depends on you, whether to use KPIs, OKRs, or both to improve your business performance. If you are looking to enhance the performance of a certain project that's already been established, then KPIs might be a better option. But if you are looking for an overall improvement, then through OKRs you can have an in-depth view of your goals and plan how to reach them.

Are you wondering if you can leverage both to scale performance? Yes, its definitely possible to utilize both, OKRs and KPIs to improve the overall performance of your organization.

How to use KPIs with OKRs?

To answer the question more precisely, it is much easier than you think to seamlessly incorporate OKRs with KPIs. Let’s quickly dive in and understand how they best work together.


In this case, let’s say your goal is new customer acquisition. Ultimately, this will be your Objective and based on this you can quantify your Key Result as Increase new customer acquisitions by 30% by the end of the quarter.

Now, if you noticed, the KPI is already derived from the above-mentioned KR (Key Result), that is, new customer acquisition. It can be considered as a KPI as it serves the basic purpose of determining the success of your company through new customer acquisition.

Here is the whole OKR and KPI framework of a Customer Success team to help you understand better:

Objective: Streamline Customer Experience

Key Results:

  • Increase customer satisfaction score from 6.5 to 8
  • Increase customer retention rate from 75% to 85%

Hence, here the KPIs will be as follows:


  • Customer Satisfaction Score
  • Customer Retention Rate

Having said that, you may have noticed that the KRs are quantified. However, it is not always essential for KRs to be quantifiable in some cases. Also, we have compiled some best practices that will support you in successfully implementing the OKR and KPI framework and get the most out of it.

  • While establishing OKRs and KPIs, define your target-metrics that reflect your organizational priorities.
  • Link targeted outcomes to well-defined metrics to ensure that everyone is on the same page.
  • Make feedback a consistent practice so as to enable leaders to identify and discuss about the bottlenecks in the process.
  • Abide by the SMART (Specific, Measurable, Aligned, Relevant, and Time-based) principle while developing metrics for KRs or KPIs.
  • Select relevant metrics that you think will be best to assess the performance of your employees.

Final Words

Regardless of whether you use KPIs, OKRs, or both, the bottom line is to measure, improve, and review performance consistently. If you do not set appropriate goals or you set them but fail to review the status at the end of the quarter or year then you are missing the opportunity to learn and improve.

Therefore, make it a priority to implement performance metrics in your organization and you will be able to notice the impact it made on enhancing the performance of your company as a whole.


About Keka HR:
Company LogoKeka HR is an end to end employee experience platform, an HRMS software with features like payroll management, attendance & time tracking, leave management, remote productivity tracking etc.
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