Product Managers Need To Balance OKRs and KPIs To Deliver Long-Term Client, Business, And Team Value

When it comes to OKRs and KPIs, it’s not either/or, but AND

Product people are constantly pulled by clients, their teams, and their stakeholders.

Experienced product people know that being quantifiable and data-informed in serving these groups is crucial to continuously tracking progress towards goals and adjusting course when necessary.

Aspirational OKRs matched with KPIs represent the simplest way to align the needs of all three.

OKRs represent the new stretch goals for the team

Objectives and Key Results are set as a team’s quarterly aspirational “moonshot” goals.

OKRs are measures of movement meant to challenge teams to raise their level in solving meaningful problems in quantifiable ways. The goals should seem daunting at the beginning of the quarter, and that’s OK — it’s in the pursuit of those goals that teams will need to dig down and Discover and Deliver their best work.

Think of OKRs as the destination you plug into your GPS.

But pursuit of these lofty goals can come at a price…

KPIs are what you need to regularly monitor and protect

Key Performance Indicators are more static, snapshot measurements.

As Christina Wodtke says:

OKRs are stretch goals. They are shoot for the moon goals. But not everything needs to be pushed. Some things need to be maintained.

Chosen thoughtfully, KPIs can balance the OKRs and zero in on the measurements that can mean the difference between short-term wins and longer-term viability. For instance, the team might have an OKR to increase Average Revenue Per User (ARPU). Easy, just raise prices, right?

Without balancing KPIs like Average Recurring Revenue (ARR) or Retention, the wins of one quarter may come at the expense of future business viability.

Don’t forget people-focused metrics of success

It’s also easy to forget the people on both sides of value delivery.

Client-focused success metrics

Clients are not just vehicles to extract value from, but have their own needs.

As the above examples of ARPU and ARR show, any short-term focus on boosting revenue must always be balanced with churn or sentiment (NPS) KPIs to track whether we’re doing something with unintended consequences.

Team health-focused success metrics

Similarly, the teams doing the work represent needs, wants & aspirations.

Long-term, meaningful client or business goals can’t be achieved at the expense of a regular measurement of Team Health — Happiness, Work/Life balance, Innovation can all be areas to focus on to insure people are learning, growing & continuously improving.

When it comes to OKRs and KPIs, it’s not either/or, but AND –

Always remember the OKR goals you need to push for, and the KPI numbers you need to protect, together with the people behind them.

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