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OKRs vs KPIs: understanding measurements for your SaaS product
OKRs vs KPIs — the most recent darlings of the SaaS world. Everyone wants to use them, but a lot of people tend to confuse what they are for and how to actually implement them properly. How do they compare to metrics? Are they the same thing? Let’s find out!
To get you started in the right direction, let’s look at what these two concepts are about, how and when to use them, and answer some common questions in a brief Q&A.
TLDR
If you’re short on time, here’s the quick breakdown:
- Objectives and key results are there to help you focus on business outcomes.
- KPIs are there to help you keep track of how your results are performing.
- A metric is a different level of data tracking — use these to help you understand health metrics.
- All key performance indicators are metrics, but not all metrics are KPIs.
- Some do’s and do not’s when setting OKRs and KPIs for your team.
- Common questions around how to measure, when to measure, and making sure your whole company is set for success.
What are OKRs?
OKR stands for objectives and key results, and their main goal is to help give your team focus.
Objectives are always linked to the company’s larger vision and mission. They help you understand the impact that your work is having. Above all, they are outcome-focused and key results always measurable.
This means that you’re trying to move the needle up or down in some way by working on projects that will help you achieve that end goal. Keeping something static (like keeping a metric at a particular number) is not a key result.
I will give you two OKR examples, one real-world and the other business-based:
Now that you have the end goal you want to achieve, and a measurement for where you want to be when you do the work, the set OKRs provide you with an overall direction and focus for your team.
