In the world of digital products, we often hear that “what isn’t measured doesn’t exist”. Yet many teams exhaust themselves monitoring dozens of metrics (KPIs) without ever seeing their product make real progress.
Why? They confuse “monitoring health” with “driving growth.” For 5 Degrés, the distinction is fundamental: the KPI is your dashboard, the OKR is your compass.
We'll see how these two tools work together to turn an abstract vision into concrete results.
What is a KPI (Key Performance Indicator)?
Definition: The daily dashboard
KPIs are performance metrics that remain consistent over time. To understand their role, simply look at the dashboard in your car: current speed, fuel level, or engine temperature.
These metrics tell you whether your product is performing well. They don’t change from month to month; you always need to know how much fuel is in the tank or whether the engine is overheating (e.g., your platform’s error rate).
The Role of the "Health Check"
The KPI acts as a constant health indicator. As long as the needle is in the green zone, you don’t need to take any action. You simply monitor to ensure that the vehicle’s vital signs are maintained.
- Speed KPIs: The number of active sessions.
- Fuel gauge: Your cash flow or your profit margin.
- Server status indicator: The response time of your servers.
The Limitations of Management Based Solely on KPIs
Relying solely on KPIs is like keeping your eyes glued to the speedometer without ever looking at the road. You may have a full tank and a perfectly oiled engine, but if you’re just driving in circles in a parking lot, you’ll never get anywhere. That’s the risk of optimized stagnation : you polish up the dashboard, but you don’t leave town.
What is an OKR (Objectives and Key Results)?
Definition: The driving force behind strategic ambition
If KPIs are your dashboard, OKRs are your GPS. It sets a specific and ambitious destination to be reached within a given timeframe.
- The Objective (O): This is your destination (e.g., “Arriving on the French Riviera for vacation”). It is qualitative and motivating.
- Key Results (KR): These are the crucial milestones along the way that show you’re making progress (e.g., “Pass Lyon before noon,” “Have traveled 500 km on the highway”).
Temporality: A Cycle-Based Approach
Unlike a KPI, which applies throughout the vehicle’s entire lifespan, an OKR is often set for a cycle (a quarter). It’s the specific path you’ve decided to take right now to move your business forward. Once you arrive in Nice, you’ll enter a new destination into your GPS.
Alignment of production teams
OKRs ensure that everyone on the team (developers, designers, and marketers) is fully aligned on the direction. Rather than simply “pushing buttons” or performing tasks without understanding their purpose, the team understands exactly how each sprint and each feature contributes to reaching the next milestone on their planned journey.
KPIs vs. OKRs: A Comparison Chart to avoiding confusion
In your car… | KPIs (Dashboard) | OKR (The GPS) |
The Question | “Is the car okay?” | “Where are we going now?” |
The Role | Monitor operation. | Spark the movement. |
The Mindset | Control and stability. | Ambition and change. |
Temporality | Permanent. | Temporary (for the duration of a trip). |
Product Example | Maintain the retention rate at 30%. | Achieve a 50% retention rate through a new onboarding system. |
How to Combine KPIs and OKRs in Your Product Operating Model
Turning a Failing KPI into a Priority OKR
The connection between the two is simple: if a health KPI turns red (e.g., the oil light comes on), it becomes your top priority. That failing KPI immediately becomes an OKR for the quarter: “Fix the leak and secure the engine.” Once the engine is repaired, the indicator reverts to a simple monitoring KPI.
However, this isn’t an absolute truth. An OKR can just as easily be used to propel a KPI that is already performing very well to new heights (e.g., moving from a steady cruising speed to top speed), or to explore entirely new strategic territory that isn’t yet mapped out in your current KPIs. KPIs fuel the thinking, but it’s your strategy that dictates the OKR.
The North Star Metric as a bridge
The North Star Metric is your final destination, the one that makes the whole journey worthwhile (e.g., reaching the ocean).
- Your KPIs ensure that the car performs well on the road.
- Your OKRs are the stepping stones that bring you closer to that ocean
5 Degrés' Expertise: Aligning Data with Strategy
At 5 Degrés, we help product teams set up their “digital dashboard.” We install the right metrics for your KPIs and help you establish a roadmap (OKRs) that is both technically feasible and strategically ambitious.
Common mistakes to avoid when implementation
Turning OKRs into a simple "to-do list"
The mistake is to include tasks in your OKRs.
- Bad KR: “Shift into 5th gear” (This is an action, an output).
- Good KR: “Having covered 100 km in an hour” (That’s a result, an outcome). We don’t measure the effort of driving; we measure the distance traveled.
Having too many goals at once
Trying to go to 10 places at once. If you enter five different destinations into your GPS, you’ll end up off the road. A scalable product team should have no more than two or three simultaneous OKRs to maintain maximum focus on the road ahead.
Conclusion: Drive with both eyes open
KPIs keep you afloat; OKRs help you grow. An elite product team uses both to navigate with precision. Without KPIs, you risk running out of gas in the middle of the highway. Without OKRs, you’ll stay safely in the garage. It’s this duality that transforms an average product into a market leader.
FAQ: KPIs vs. OKRs
Can a KPI become a Key Result?
Exactly. If your gas gauge (conversion KPI) shows that the level is too low, your goal for the quarter will be to fill up the tank. Once it’s full, you’ll simply go back to monitoring the gauge.
Who should set the OKRs for the product team?
It’s a team effort. The Head of Product chooses the destination (the Goal), but the team (Dev, Design) maps out the route and the milestones (Key Results) to ensure the car can actually make the journey.
Are OKRs suitable for small startups?
Yes, because they help keep the focus. When you’re trying to find product-market fit, having a single, clear OKR prevents you from getting sidetracked by unnecessary features.
RTE
