OKR vs KPI: What’s the Difference and How to Use Both Effectively

For PMOs and project professionals, measuring performance and delivering strategic value are constant challenges.

You need visibility of what is happening today, while also driving the outcomes your organisation needs tomorrow. That is where KPIs and OKRs come in.

The two are often confused and sometimes used interchangeably, but they serve very different purposes.

KPIs help organisations monitor operational performance and business health. OKRs help organisations focus effort, align teams, and drive strategic change.

The strongest organisations do not choose between them. They use both together.

In this guide, we explore:

• The Difference Between OKRs and KPIs
• When to Use Each
• How They Work Together
• Common Mistakes Organisations Make
• Why Both Matter for Benefits Realisation and Strategic Delivery

What Are KPIs?

KPIs (Key Performance Indicators) are measurable metrics used to monitor ongoing performance.

They help organisations understand whether operations, services, projects, or teams are performing as expected.

• Operational
• Measurable
• Ongoing
• Performance-Focused

For PMOs and project teams, KPIs often focus on:

• Delivery Performance
• Cost Management
• Efficiency
• Compliance
• Service Levels
• Example KPI
• Percentage of Projects Delivered on Time and Within Budget

KPIs provide visibility of current performance and help organisations identify risks, trends, and areas requiring attention.

What Are OKRs?

OKRs (Objectives and Key Results) are a framework used to turn strategy into measurable action.

They help organisations define what they want to achieve and how success will be measured.

An OKR consists of:

An Objective: A Clear Statement of What You Want to Achieve
Key Results: Measurable Indicators of Progress

Unlike KPIs, OKRs are designed to:

• Create Focus
• Drive Change
• Improve Alignment
• Encourage Accountability
• Support Strategic Priorities

OKRs are often used during periods of:

• Transformation
• Growth
• Organisational Change
• Portfolio Delivery
• Strategic Realignment

A simple way to think about it is:

• KPIs Help Maintain Performance
• OKRs Help Improve Performance

Or put another way:

• KPIs Safeguard Stability
• OKRs Accelerate Growth

When to use each

• KPIs are best for tracking efficiency, productivity, and compliance. They monitor ongoing performance, flag risks, and assess whether business-as-usual activities are stable.
• OKRs are best used as part of new portfolios, to drive innovation, or when aligning teams with growth targets. They are designed for transformation, not just maintenance.

Why they matter

• KPIs introduce clear standards of performance. They support decision-making and enable continuous monitoring and improvement.
• OKRs reinforce strategic focus. They promote accountability, create transparency, and ensure that change happens in manageable, iterative cycles.
• Together, they give organisations a balanced system of measurement. KPIs safeguard stability while OKRs accelerate growth.

How to apply them

KPIs:

• Select a few meaningful, measurable criteria for success.
• Benchmark to establish a baseline.
• Set realistic targets that track process evolution.
• Review them regularly and update as needed.

OKRs:

• Define goals that clearly align with strategy.
• Work with 3–5 objectives per cycle, each with measurable key results.
• Review and reset at the end of each cycle (quarter or sprint).
• Use findings to continuously improve.

This “When, Why, How” lens ensures your teams do not confuse OKRs and KPIs, and instead use them together as complementary tools for both monitoring performance and driving change.

Can you have KPIs and OKRs?

Yes, in fact you should. It is not an either/or choice.

• KPIs monitor performance against established expectations.
• OKRs create the ambition to improve, innovate, or transform.

For a PMO, this might look like:

• KPI: 80% of projects delivered on time.
• OKR: Increase on-time project delivery to 95% by redesigning the planning process and improving stakeholder engagement.

Here, the KPI tells you where you are, while the OKR defines where you want to be.

To learn more about how PMOs can lead OKR practice, read: The Role of the PMO in Successful OKR Implementation.

How to use OKRs and KPIs together successfully

When combined, OKRs and KPIs create a dual-lens performance system:

1. Establish the baseline with KPIs. KPIs tell you the current performance of your PMO, projects, or business functions. They highlight whether processes are working and where gaps exist.
2. Define ambition with OKRs. Once you understand the baseline, use OKRs to set stretch targets that address weak points or seize opportunities.
3. Integrate reviews. Review KPI dashboards alongside OKR progress in governance meetings. This helps you see both performance stability and transformation potential in one place.
4. Adapt based on evidence. KPIs can inform whether your OKRs are realistic. OKRs can push KPIs to improve over time. Together, they enable continuous improvement.

For example:

• KPI: Customer service satisfaction score (baseline 82%).
• OKR: Increase satisfaction to 90% by improving self-service options, reducing average response time, and launching a feedback loop.

How OKRs and KPIs inform decision-making

For project and PMO professionals, the real value comes when KPIs and OKRs shape better decisions:

• Resourcing decisions: KPIs may show resource bottlenecks, while OKRs highlight where investment is needed to deliver strategic change.
• Portfolio prioritisation: KPIs reveal underperforming areas, while OKRs define where to focus improvement efforts.
• Risk management: KPIs act as early warning signals, while OKRs guide corrective actions to mitigate risks.
• Benefits management: KPIs monitor realised benefits, while OKRs ensure that strategic change continues to deliver them. (Explore more in our post: A Guide to Benefits Management Process).

Watch video: How to assess benefits & OKR maturity in your organisation

Examples of OKRs and KPIs across departments

Sales

• KPI: Monthly sales revenue (£).

• OKR:

  • Objective: Expand revenue from new markets.

  • Key Results:

    • Close £2M in new business from the financial services sector.

    • Grow sales pipeline by 30% in targeted regions.

    • Shorten average deal cycle from 90 to 60 days.

PMO / Project Management

• KPI: Percentage of projects delivered on time and within budget.

• OKR:

  • Objective: Improve PMO value delivery.

  • Key Results:

    • Achieve 90% satisfaction rating from project sponsors.

    • Reduce average project delay by 25%.

    • Implement automated reporting across 100% of active projects.

Human Resources

• KPI: Employee turnover rate.

• OKR:

  • Objective: Increase employee engagement and retention.

  • Key Results:

    • Achieve 80% engagement score in annual survey.

    • Reduce voluntary turnover by 15%.

    • Ensure 95% of employees complete quarterly career development conversations.

Customer Service

• KPI: First-response time to customer queries.

• OKR:

  • Objective: Deliver world-class customer support.

  • Key Results:

    • Reduce average response time from 12 to 4 hours.

    • Achieve a 95% customer satisfaction score.

    • Increase self-service usage by 20%.

Best practices for using KPIs and OKRs

For KPIs:

• Choose the vital few. Track only the KPIs that truly reflect business health.
• Keep them measurable. Use clear, unambiguous data sources.
• Assign ownership. Each KPI should have a responsible team or individual.
• Review regularly. Update or retire KPIs that are no longer relevant.

For OKRs:

• Limit scope. Focus on 3–5 objectives per cycle with 3–5 key results each.
• Stretch, but stay realistic. OKRs should be ambitious but not impossible.
• Align top-down and bottom-up. Ensure organisational goals cascade but also allow teams to set their own.
• Separate from compensation. Keep OKRs aspirational by not linking them directly to pay.
• Check in frequently. Run weekly or monthly check-ins to track progress and adapt. For more on the people side of OKRs, see: CFRs: The Human Side of OKRs.

Mistakes to avoid

1. Confusing OKRs with KPIs. OKRs are not “just more KPIs”. KPIs measure, OKRs drive change.
2. Setting too many. Tracking 20 KPIs or setting 10 OKRs per team dilutes focus. Less is more.
3. Making OKRs task-based. Key Results should measure outcomes, not activities.
4. Linking OKRs directly to bonuses. This can encourage conservative goal-setting instead of ambition.
5. Focusing only on numbers. Remember that OKRs also have a people side, with conversations, feedback, and recognition keeping teams engaged.
6. Ignoring culture. Without leadership buy-in and stakeholder engagement, OKRs and KPIs become tick-box exercises.

FAQ about OKR vs KPI

Download OKR and Benefits Realisation Brochure