OKRs (Objectives & Key Results)vsNorth Star Metric

OKRs are a goal-setting framework where ambitious Objectives (qualitative goals) are paired with 2-4 measurable Key Results that prove the objective was achieved. Intel invented them. Google adopted them at 40 employees and credits OKRs with 10x'ing their focus. The ideal OKR is 70% achievable — if you hit 100%, your goals weren't ambitious enough.

Your North Star Metric is the single number that best captures the core value your product delivers to customers. Airbnb's is 'Nights Booked.' Spotify's is 'Time Spent Listening.' When this metric goes up, everything else follows — revenue, retention, referrals. It aligns the entire company around one measurable goal.

Teams turn OKRs into task lists. 'Launch feature X by March' is a task, not a Key Result. A proper Key Result measures IMPACT: 'Increase 7-day retention from 40% to 55%.' The difference is enormous — one checks a box, the other drives real business outcomes.

The biggest mistake is choosing a vanity metric as your North Star. 'Total Users' sounds impressive but ignores whether those users are active or getting value. Zynga had hundreds of millions of registered users but collapsed because their North Star should have been 'Daily Active Players,' not sign-ups.

Set 3-5 Objectives per quarter. Each Objective gets 2-4 Key Results. Key Results must be numerical and measurable. Score them 0.0-1.0 at quarter end. Aim for 0.6-0.7 average — lower means you're sandbagging, higher means you're not ambitious enough.

Pick a metric that reflects VALUE DELIVERY, not revenue directly. Test it with this framework: (1) Does it measure the value users get? (2) Does it predict long-term revenue? (3) Can every team influence it? If yes to all three, you have your North Star. Rally the entire team around this single metric.