KPIs, OKRs & KRAs: What You Need to Know
Three of the most popular modern ways to measure success are as follows:
Key Performance Indicators (KPIs)
Objectives and Key Results (OKRs)
Key Result Areas (KRAs)
What is a KPI?
Key Performance Indicators (KPIs) are critical key indicators of progress towards a goal. KPIs act
as a focal point for strategic and operational improvement, serve as an analytical basis for decision-
making and aid in focusing attention on what is most important. From finance and HR to marketing
and sales, key performance indicators help every area of the business move forward at the strategic
level. KPIs should typically do the following:
Link to strategic objectives
Direct where to focus resources
Be measured against targets
We strongly advise you to make your KPIs measurable. By giving quantifiable value, you may
provide context and compare performance for whatever you’re evaluating. It is sometimes feasible
to create qualitative KPIs, however, it is not recommended because this structure may lead to data
misreading and subjective interpretations.
Examples of KPIs
There are countless examples of KPIs spanning all industries. A key performance indicator (KPI)
can be any quantitative (or, in rare situations, qualitative) metric that a company uses to assess its
progress and achieve its objectives.
Here are some examples of common KPIs for various businesses and divisions:
What is an OKR?
Objectives and Key Results (OKRs) are a collaborative goal-setting process that teams and
individuals use to set challenging, ambitious goals with measurable outcomes. OKRs are used to
track progress, promote alignment, and inspire participation in the pursuit of measurable goals.
OKRs are utilized by some of the world’s most successful firms to develop and implement their
plans.
An organization will typically have three to five high-level objectives and three to five critical
results for each objective. To provide a clear performance evaluation for the objective, key results
are numerically evaluated.
Always quantifiable
Able to be objectively scored on a numerical scale
Timelined
Ambitious and challenging
Examples of OKRs
OKRs are based on big-picture goals and targets that are intended to push employees and
businesses ahead, thus they should be on the “nearly impossible” side. The OKR framework is a
never-ending cycle of rapid, dynamic growth.
Some general OKR instances are as follows:
Examples of OKRs
What is a KRA
A key result area (KRA) is a strategic element, either internal or external to the company, where
significant positive results are required for the organization to achieve its strategic goals and
therefore progress towards realizing the organization’s longer-term vision of success. Key Result
Areas are sometimes known as ‘critical success factors’ or ‘key success drivers’.
Furthermore, KRAs highlight job descriptions in a job profile, assisting employees in better
understanding their roles and duties and aligning their efforts with the organization’s goals.
Essentially, KRAs are as follows:
The fundamental area of outcome for which an employee or department is responsible.
A metric that defines the areas in which the employees are responsible to produce results.
A qualitative measure or metric as it defines the areas that can help in achieving the
objectives of the organization.
Helps find out the scope of a particular job or product.
Examples of KRAs
Examples of KRA’s for various industries
Pros and Cons
An annual review is intended to give a forum for a leadership team and employees to examine
performance, accomplishments, and contributions to the organization.
OKR
1. are strategic frameworks,
2. OKRs are a straightforward, black-and-white approach to goal achievement that employs
precise criteria. An organization will typically have three to five high-level objectives and
three to five critical results for each objective.
KPIs
1. Measurements inside a framework.
2. The importance of measuring performance
Whatever technique your company chooses, the bottom line is that monitoring and reviewing
performance is the best way for your company to succeed. When it comes to successfully attaining
the organization’s goals, taking the time to create targets and evaluate them at the end of the
designated period is critical.
