OKRs, ODMs and KPIs - Difference

A quick article showing the difference, tried to keep it simple.

Objectives and Key Results (OKR)

1. Goal setting framework
2. Tool for communicating what the organization wants to achieve and how to measure the desired (aspirational) objective
3. Used in strategic conversation i.e. strategic initiatives not BAU (Business as usual)
4. Helps create alignment within the organization (eg Business and IT alignment)
5. Encourages teams to think big and embrace innovation and nurture a culture of growth and creative thinking
6. Multiple teams may be required to complete these. Thus a strategic roadmap will help ensure cross teams alignment
7. Should be limited to 3-5 Objectives (O) and each Objectives should have between 3-5 Key Results (KR) to measure success
8. Still considered as an outcome based metrics and typically have a quarterly cycle where you measure key results every quarter (progress towards the objective)
9. OKRs are continuously reviewed to ensure they are aligned with organizational priorities
10. Eg - Objective - Solve the support ticket issues we are experiencing. KR1 - Reduce response time by 10%, KR2 - Improve customer satisfaction score by 5%, KR3 - Increase ticket handled from 150 to 180

Outcome-driven Metrics (ODM)

As if there wasn't enough confusion already, Gartner has introduced a new metrics lol.

1. Operating metrics - vs Strategic
2. Support Business Objectives (Business as usual or daily activities) that support the business value
3. Have two level - Business ODM's and Technology ODMs
4. Business ODMs - Metrics that business understands while Technology ODM's are metrics that technology uses to measure how their work supports Business
5. Business will use Business ODMs to measure how effective are IT efforts on the business outcomes
6. Technology will use Technology ODMs to measure how technology investments and work tech does(or has done) have direct impact to business outcomes.
7. Technology ODMs are more aligned to see how effective technology work has been to solve business problems
8. Technology ODMs helps connect the work Tech is investing in (or should be investing in) to the Business ODMs
9. Examples of Tech ODMs -- that have a direct impact to Business ODMs are - system uptime, system reliability, security preventions (such as phishing reports), system performance that support the service level agreements, ability to use AI driven suggestions to help business reps support customers etc.

Key Performance Indicators (KPI)

1. Measures performance of a specific activity or ongoing work (can also be an initiative that has a KPI defined)
2. Focus is also on BAU (business as usual) work/activity still aligned to a measurable business impact
3. Focuses on how the organization is delivering value, optimizing cost and reducing risk
4. These are key targets that are tracked to make the most impact to business outcomes
5. They support strategy and help teams focus on what's important
6. While OKRs are ambitious goals and help with alignment, KPIs are laser focused metrics that are used to monitor performance
7. KPIs are high-level tracking large business areas for extended period of time
8. Eg- Complete 200 tickets responses per hour. (so you want to consistently hit a response rate of 200 tickets per hour). On the other hand, your volume may be going on the number of customer that call per hour, say from 1000 to 3000, but your KPI is still measuring that you close 200 tickets per hour, this could result in over slow response time the customer is experiencing. You are treating the symptom rather then the problem