Management ideas have a way of becoming tribes. Once a concept gains momentum, organisations divide into believers and sceptics, consultants build frameworks around it, and what should be a practical management question becomes an argument about labels. The current tussle between OKRs and KPIs increasingly feels like one of those debates.
Objectives and Key Results, or OKRs, trace their modern origins to Andy Grove at Intel. Grove adapted Peter Drucker’s Management by Objectives into what he called Intel Management by Objectives, later popularised by John Doerr as OKRs. The attraction was understandable: focus on a few important objectives, define measurable results, create transparency, align people around priorities and encourage stretch.
“A bad KPI system becomes a graveyard of dozens of measures disconnected from strategy. A bad OKR system becomes the same thing with fashionable terminology: too many objectives, goals that hardly stretch, vague key results, cascading bureaucracy and quarterly rituals with little connection to genuine strategic choices.”
One feature of the original philosophy has always intrigued me. OKRs were deliberately separated from compensation. The logic was that if ambitious goals directly determined pay, employees would naturally negotiate safer goals and stretch would disappear. Contemporary OKR guidance still warns that tying OKRs mechanically to bonuses encourages “sandbagging” and undermines ambition. Conceptually, that makes sense. Practically, however, I have always wondered: why operate two parallel goal systems?
If an employee already has a formal performance system containing goals, measures, targets and an appraisal that affects reward, what purpose is served by adding another set of objectives and key results alongside it? Which goals receive attention when the two compete? Which ones does the manager really care about? And if the OKRs supposedly represent the organisation’s most important priorities, why should they sit outside the system used to assess performance?
Interestingly, practice has begun answering that question. Many organisations now incorporate OKRs into formal performance discussions and, in some cases, rewards. Even Intel has evolved. Its public compensation disclosures show that individual OKRs have been included in the annual cash bonus plan for senior executives since 2022.
There is nothing inherently wrong with that evolution. Management ideas should grow as organisations discover what works. But we should acknowledge that this is an evolution from an important part of the original philosophy rather than pretend OKRs have always been used in the way many organisations use them today. The same historical fairness should be extended to KPIs.
Critics often describe KPIs as static operational measures: revenue, cost, turnaround time, defect rates, complaints and other numbers inherited from one year to the next. That certainly describes many badly designed performance systems. But it does not adequately describe the modern concept of strategy-aligned KPIs. Robert Kaplan and David Norton’s Balanced Scorecard fundamentally changed this conversation. Their work moved performance measurement beyond traditional financial indicators and explicitly connected strategy to objectives, measures and targets across financial, customer, internal-process, and learning-and-growth perspectives. The underlying logic was that measures should reflect strategy rather than simply perpetuate yesterday’s metrics.
This is where the OKR–KPI distinction becomes less dramatic. An OKR might state: Objective: Become the preferred digital bank for SMEs. Key Results: Increase active SME digital users to 180,000, raise digital transactions to 65 per cent and improve SME Net Promoter Score to 55. A Balanced Scorecard might state: Strategic Priority: Win in SME banking. Strategic Objective: Deepen digital engagement. KPIs: Active SME digital users, digital transaction share and SME NPS. Targets: 180,000, 65 per cent and 55.
At that point, are we really debating fundamentally different management concepts or partly different nomenclature for strategy-aligned objectives, measures and results?
There are differences. OKRs typically emphasise shorter cycles, transparency, employee participation, stretch and frequent review. Balanced Scorecards begin more explicitly with strategy architecture: strategic priorities, objectives, causal relationships, measures, targets and initiatives. Those distinctions matter. But the overlap is substantial.
The debate becomes particularly unhelpful when advocates compare today’s OKRs with yesterday’s KPIs. Modern OKRs are presented as dynamic and strategic, while KPIs are caricatured as dusty operational numbers sitting in annual appraisal forms. That is hardly a fair comparison. Nor is changing the acronym a cure for poor performance management.
A bad KPI system becomes a graveyard of dozens of measures disconnected from strategy. A bad OKR system becomes the same thing with fashionable terminology: too many objectives, goals that hardly stretch, vague key results, cascading bureaucracy and quarterly rituals with little connection to genuine strategic choices.
There is another danger when OKRs enter appraisal. The moment a stretch goal becomes a compensation contract, human behaviour changes. People become more conservative, targets become negotiable and ambition can give way to score protection. Yet the answer need not be two entirely separate systems. Even contemporary OKR guidance acknowledges that OKRs can inform performance conversations without simply becoming the appraisal score itself.
A mature performance architecture can distinguish between committed targets and genuine stretch goals while remaining one coherent system. Performance conversations can consider results, behaviours, competencies, context and learning rather than mechanically converting every target into a bonus percentage. Perhaps that is the real opportunity: stop asking organisations to choose between competing acronyms and design one integrated strategy-to-results system.
Start with strategic priorities. Translate them into clear objectives. Define the results or measures that demonstrate success. Set targets. Assign ownership. Identify the initiatives and actions required. Review progress frequently. Learn. Adjust. Reward performance intelligently. Call the measures KPIs. Call them ‘Key Results.’ Call the framework an OKR system, a Balanced Scorecard or something else entirely. The label matters less than whether the organisation has created alignment between strategy, execution, measurement and accountability.
The real tussle, therefore, is not OKR versus KPI. It is strategy versus activity, evidence versus opinion, disciplined execution versus fashionable terminology and whether our management systems help people focus on what matters and deliver results.
Omagbitse Barrow is the founder of Efiko Management Consulting, and he supports organisations and leaders to translate their strategy to results.
