How to Track Success: OKRs, KPIs, and other methods

Tracking internal goals is crucial for any business, whether you're a startup or a growing company. We’re breaking down the most common goal-tracking methods in order to help you decide which one is right for your business.

1. OKRs (Objectives and Key Results)

OKRs are a goal-setting framework that helps organizations align their objectives and measure progress with specific, measurable outcomes.

An OKR consists of:

• Objective: A bold, qualitative goal that inspires action.

• Key Results: Measurable outcomes that determine whether the objective was achieved.

💡 Example of an OKR for a Startup:

Objective: Become the leading online marketplace for sustainable fashion.
✅ Key Result #1: Increase website traffic from 50K to 200K visitors per month.
✅ Key Result #2: Grow active sellers from 1,000 to 5,000.
✅ Key Result #3: Improve conversion rate from 2% to 5%.

Why use OKRs?
✔ Helps teams focus on big-picture goals.
✔ Encourages ambitious, stretch goals.
✔ Creates alignment across teams.

Best for: Startups, fast-growing companies, and teams that want a structured approach to tracking big goals.

2. KPIs (Key Performance Indicators)

KPIs are specific, trackable metrics that measure the ongoing performance of a company, department, or individual. Unlike OKRs, which focus on big-picture goals, KPIs are used to track progress on key business functions.

Examples of KPIs:

📊 Marketing KPI: Increase social media engagement by 30% in Q2.
📈 Sales KPI: Close 50 new deals per month.
🛒 E-commerce KPI: Reduce cart abandonment rate to below 40%.

Why use KPIs?
✔ Helps teams track continuous performance.
✔ Provides clear benchmarks for success.
✔ Can be used for any aspect of a business (marketing, sales, customer support, finance, etc.).

Best for: Businesses that need to monitor ongoing performance metrics and optimize day-to-day operations.

3. North Star Metric

A North Star Metric (NSM) is a single, defining metric that represents the core value your company delivers to customers. It helps teams focus on long-term success rather than just short-term goals.

Examples of North Star Metrics:

🚗 Uber: Number of completed rides per day.
📦 Amazon: Number of purchases per customer.
🎵 Spotify: Total minutes streamed per user.

Why use a North Star Metric?
✔ Keeps the company focused on delivering core value.
✔ Aligns all teams around a single goal.
✔ Helps prioritize product and business decisions.

Best for: Growth-stage companies that need a single guiding metric to optimize their product and strategy.

4. SMART Goals (Specific, Measurable, Achievable, Relevant, Time-bound)

SMART goals are an effective framework for setting clear, actionable objectives. They ensure that goals are well-defined and attainable.

Example of a SMART Goal:

🎯 Increase customer retention from 65% to 75% by the end of Q3 through a personalized email marketing campaign.

Why use SMART goals?
✔ Ensures goals are realistic and structured.
✔ Works well for individual and team goal setting.
✔ Keeps teams accountable with clear deadlines.

Best for: Small teams and individuals who need well-structured goals with clear timelines.

5. Leading vs. Lagging Indicators

Understanding leading and lagging indicators is essential for tracking progress effectively.

• Leading Indicators: Predict future success (e.g., number of sales calls made).

• Lagging Indicators: Measure past performance (e.g., total revenue earned).

Example:

• Leading Indicator: Number of customer sign-ups.

• Lagging Indicator: Total revenue generated from those customers.

Why use them?
✔ Leading indicators help businesses adjust strategies early.
✔ Lagging indicators show actual results and business impact.

Best for: Businesses looking to track early signals of success and adjust accordingly.