How OKRs work
Company leaders set a few objectives for the quarter. Departments and teams write OKRs that support them, and individuals may add their own. An objective answers 'what do we want to achieve?' in plain words, such as 'Make our new Kochi branch the easiest place in the city to open a savings account.' Key results answer 'how will we know?' with numbers: account opening in under 20 minutes, 1,000 new accounts, and a satisfaction score above 4.5. At the end of the quarter each key result is scored, often from 0 to 1, and the team discusses what worked.
OKR vs KRA vs KPI
KRAs are the stable areas a role owns. KPIs are the running measures for those areas. OKRs are time-bound pushes to change something, deliberately set above the comfortable level. Many companies that adopt OKRs keep KRAs and KPIs for the appraisal and use OKRs for direction and focus, because scoring 0.7 on a stretch key result counts as a good outcome in OKR terms but would look like underperformance in a KPI-based rating.
Common mistakes with OKRs
Review OKRs in a short weekly or fortnightly check-in so problems surface early. ZeniaHR's Performance module lets goals be typed as OKRs alongside KRAs and KPIs, each with a weight, so every employee's KRAs, KPIs and OKRs sit in one place.
- Writing tasks as key results, such as 'launch the campaign' instead of what the campaign should achieve
- Setting so many objectives that none gets real focus
- Linking OKR scores directly to salary hikes, which pushes people to set safe goals
- Setting OKRs in April and not looking at them again until June
- Handing down OKRs with no input from the teams that must deliver them
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What is the difference between OKR and KPI?
A KPI is an ongoing measure of routine performance, such as monthly collections or ticket resolution time, with a target you expect to meet. An OKR sets a time-bound goal to change something, with an ambitious objective and measurable key results set as stretch targets. KPIs keep the business running; OKRs move it forward.
Should OKRs be linked to appraisal and salary?
OKR guidance generally advises against tying OKR scores directly to pay, because people then set safe goals instead of ambitious ones. Indian companies that use OKRs often keep KRAs and KPIs for the formal appraisal and treat OKRs as a focus and alignment tool, while still recognizing people who deliver on stretch goals.
How many OKRs should a team have?
Keep it to two or three objectives per team per quarter, each with three to five key results. More than that spreads effort too thin and turns the OKRs into a to-do list. If the team also has routine work to track, measure it through KPIs rather than adding more objectives.