OKRs and KPIs - What's the difference? And how to use them with AI for your business strategy?

In the wild world of business, the rise of AI tools and technological advancements is a game-changing dynamic, enhancing operational effectiveness and organizational flexibility.?

While AI tools undoubtedly elevate business prowess, the true realization of strategic goals relies on established frameworks like OKRs (Objectives and Key Results) and KPIs (Key Performance Indicators). They are the GPS for keeping the business strategy on course. No matter how advanced your AI toolkit is, these structured frameworks are essential for turning tech potential into strategic success.

In this article, we’ll uncover:

• What are OKRs and KPIs, and what are the differences?
• Do you need both OKRs and KPIs or just one of them?
• What's the best way to set up and track OKRs and KPIs in your organization?
• How does AI play a role in enhancing OKRs and KPIs?

Click here to read the full article.

What are OKRs and KPIs? What’s the difference?

Though similar, OKRs and KPIs are not the same thing. Let’s take a look at how these two frameworks differ from each other and the benefits they provide.

What are Key Performance Indicators (KPIs)?

KPIs stand for Key Performance Indicators. They concentrate on measuring and maintaining business health and are used to evaluate progress. The duration of measurement of KPIs can vary, as KPIs are often assigned to individuals and are commonly tied to performance evaluations and performance reviews.?

In short, KPIs are used to measure performance accurately, by:

• Providing a quantifiable measure of performance for organizations to track progress toward specific goals
• Aligning to a particular role and providing data for 1:1 discussions with a manager
• Enabling organizations to identify areas for improvement?
• Establishing a clear benchmark for evaluating individual performance

Let’s take the example of a Customer Success executive. Here are some KPIs they would measure:

Key Performance Indicator 1 - Customer Satisfaction Score (CSAT):?

Maintain a CSAT score of 90% or above through regular customer feedback surveys.

Key Performance Indicator 2 - Net Promoter Score (NPS):?

Achieve an NPS of 40 or higher as an indicator of customer loyalty and likelihood to recommend the product or service.

Key Performance Indicator 3 - Renewal Rate:?

Ensure a customer renewal rate of 95% to demonstrate customer retention and satisfaction.

Key Performance Indicator 4 -? Response Time to Support Tickets:

Maintain an average response time to customer support tickets below two hours to ensure timely issue resolution and customer support.

What are Objectives and Key Results (OKRs)?

Objectives and Key Results, abbreviated as OKRs, are a method for setting and achieving strategic business goals and measuring business growth metrics. Shared commitments from teams are the backbone of OKRs. OKRs operate in quarterly cycles with weekly check-ins for identifying blockers, planning activities, and reviewing and reprioritizing actions for ambitious strategic growth.

In short, the OKRs are used to make strategy execution precise, by:

• Aligning to the mission, vision, and value prop?
• Mapping dependencies for the metrics that need focus during the quarter
• Calling out ownership from different teams and departments
• Establishing an aspirational goal for company growth
• Connecting people to organizational outcomes

Here’s an illustrative example of an OKR for the Customer Success team.

Objective: Improve operational excellence to create customer delight

Key Result 1: Reduce customer onboarding time from Y to X days?

Key Result 2: Reduce turnaround time to resolve customer queries from Y to X hours?

Key Result 3: Re-establish Customer Success touchpoints for strategic accounts by <date>

Key Result 4: Increase positive monthly customer reviews from X/5 to Y/5

To learn about OKRs in detail, check out our Ultimate Guide to OKRs .

Click here to read our full article to learn the 4 key differences between OKRs and KPIs, and understand how AI plays a role in enhancing them for your business strategy.

About Fitbots

At Fitbots, our mission is to help companies drive transformational growth with OKRs, KPIs, and initiative/milestone management, by simplifying how they connect their mission to metrics. Fitbots has worked with over 5,000+ teams, helping them get OKRs right and tracking powerful insights on our OKRs software.

With Fitbots, your teams can achieve 10X more by setting & tracking the right outcome metrics, save an average of 450 hours each quarter on report-making and clumsy powerpoints and increase transparency by 100%. We have consistently rated as a High Performer on G2 and are the proud recipients of multiple G2 badges. Our top-rated offerings include:

• 5-Step Method to reduce Strategic/Company OKRs writing to a matter of hours, helping leaders focus on action rather than verbose discussions
• AI-Assisted OKR Writing to reduce the time spent by teams in crafting effective OKRs that reflect company strategy
• Alignment and Misalignment Modules that ensure complete alignment such that there is no wastage of time, effort, revenue
• OKRs and KPIs management alongside a vast number of integrations
• Progress Boards, Trends Boards, Insights, and Reports at the organization and team level for effective decision-making and performance improvement
• Individual reports and insights to support performance-related conversations
• On-demand OKR Coaching and Certification

Click here to book a call with our OKRs expert on how we can help you get OKRs right, and manage them with powerful insights.