OKRs and KPIs: the methodology for appropriate decision making.

Definition and framework

At Voice123, we’re crafting the future of the voice-over industry, and we believe that the best way to do that is if we’re all headed in the same direction. For us strategizing entails setting Objective and Key Results (OKRs) and defining Key Performance indicators (KPIs). OKRs and KPIs are a direct consequence of our mission.
When we envision where our company should be in years to come, KPIs and OKRs are the means to get there as well as the means to check how far we have come. This strategy thus dictates the speed of appropriate decision-making.

Objective and key results (OKRs) are like a detailed roadmap of what you want to achieve. The purpose is to connect company, team, and personal goals to measurable results while having all team members and leaders work together in the same, unified direction.
OKRs help us set ambitious goals. By tracking the quality of project execution based on those goals, we can plan and prioritize efforts, and work as a whole company on achieving common goals while staying connected in the process.

A Key Performance Indicator (KPI) is a type of performance measurement used to evaluate the performance of an organization against its strategic objectives.
KPIs help cut the complexity associated with performance-tracking by reducing a large number of measures into a practical number of ‘key’ indicators. Our KPIs provide objective evidence of the progress we’re making towards achieving our goals. They also provide us with information to improve our decision-making.

How to define an OKR?

OKRs are determined at an individual, business unit, or overall business level.
Typically, the overall business OKRs are determined first. From there, each business unit and individual should set their own OKRs. Depending on your responsibility, you should define OKRs that encompass your expected contribution to the business.
To define an OKR, think about objectives as the answer to the question “where do we want to go?” and about key results as the answer to the question “how will I know I am getting there?”
Objectives may or may not be measurable, but they must be strategic. In most cases, they are set by the individual.
Finally, as part of defining your OKRs, you must define your key results for that objective. If you hit all these key results/milestones, you’ll have accomplished your objective. Key results must be measurable, limited to less than 4 per objective, and they must always be ambitious in order to push you and your team forward.

Best practices and recommmendations

Review your own OKRs as well as those of your team members regularly.
If your OKR is the same as that of your team, it's fine.
Don't create OKRs for the sake of OKRs.
Grade OKRs per quarter or annually. Add up the results of your key results to determine your grade.
Embrace the fact that OKRs constitute data that helps you learn. If you hit an 8-10, ask yourself what more you could have done; if you hit a 1-5, ask yourself whether your planning was wrong.
Not every role is the same. We have KPI-dominated roles and OKR-dominated roles. That's fine, too.

Don't set more than 5 OKRs per quarter
OKRs are not about getting a good grade for your Q, but to dream even bigger for the next one
We strongly recommend you use a tool to manage OKR goals, exchange continuous feedback, and conduct performance reviews. (We use and therefore recommend Upraise).
To communicate our efforts with the rest of the company, our OKRs are visible. By communicating clear objectives and results as well as our personal accountability, we work together to ensure the ongoing and increasing success of Voice123.

How to define a KPI?

Determine one or more metrics that allow you to easily visualize performance within a defined timeframe. These metrics should be objective and not subjective.
KPIs function as a set of agreements that are defined by a leader and team member and are reviewed regularly in 1-1s between the leader and team member.
As part of defining a KPI, you must determine a projected result for that KPI. If possible, this should be a mathematically-predicted number. It is key to make projections based on actual data. If this is not possible, then periodically agree on — and review — specific targets for each KPI.

Best practices and recommmendations

We strongly recommend you to have an open-source way for everyone in your company to track PIs or analyze data for decision making in a certain period of time. (We use and therefore recommend Metabase)
Every team member should have KPIs
You should have a quarterly discussion on your KPIs during which you discuss whether the KPIs are still valid and how you are scoring on your KPI targets.
KPIs and PIs should be measured frequently — if possible on a weekly basis. If that isn't possible, do it on a monthly basis, or try to find another regular and suitable cadence.

Ask more experienced peers and leaders if you find yourself struggling to establish valuable projections for KPIs. They may be able to help you visualize other PIs you may not have thought of.
In some areas, it may more difficult to set clear and distinct KPIs. Don't overthink this. Measure what can be measured.
Defining KPIs follow the successful onboarding of a team member. KPIs deal with the performance of team members. Because of this, team leaders are initiators in the process of defining KPIs within Voice123. If a new team member fills an existing role within the company, previous KPIs should be taken into consideration when defining them.

How do OKRs and KPIs interact?

Just like the structure of this article, OKRs and KPIs are intertwined to a point of being inseparable. Both must be set and closely monitored.
When defining our strategy, we define our key performance indicators and set clear and measurable goals going forward.
We recommend you monitor the progress of your OKRs via a daily analysis of your KPIs. Be flexible with both your tactics and strategy so you can adapt them when needed. KPIs should allow you to translate the performance of your tactics and strategy into measurable metrics.