Ultimate Guide to Setting OKR for Software Development Success

You’ve probably felt it before: the push to deliver faster, the pressure to fix bugs quicker, the constant balance between technical work and bigger-picture impact. You’re deep in the code, but part of you also thinks about how your work drives real results. That’s where things get tricky.

It’s easy to get caught up in the day-to-day and lose track of the bigger mission. If you’ve ever wondered how to keep your software development team focused on what really matters, you’re in the right place.

In this article, you’ll learn how to turn ambitious goals into measurable outcomes that actually move the needle. You’ll also get examples of OKRs that work in real teams, plus practical ways to track them so you’re never guessing where your progress stands.

So, let’s start with the basics and answer, "What is OKR in software development?"

What Are OKRs for Software Development?

OKRs for software development are a goal-setting method that helps you connect your engineering efforts to business outcomes. Each OKR includes an Objective (what you want to achieve) and a few Key Results that define how you’ll measure progress – that’s what the acronym stands for.

Objectives should be bold and inspiring, while Key Results keep things grounded with clear, measurable goals.

The idea isn’t new. It started at Intel in the 1970s, when then-CEO Andrew Grove emphasized high-performance management in his book "High Output Management." Since then, the approach has gained broad adoption. 87% of companies in a 2022 survey said that the OKRs framework met or exceeded their expectations.

Now that you know what OKRs are, it’s essential to understand how they differ from KPIs and why that matters.

What’s the Difference Between OKRs and KPIs?

OKRs are a framework that focuses on change and growth. KPIs are metrics/variables that track ongoing performance. That’s the main difference.

OKRs give you a clear direction and help your team achieve impactful goals. Each Objective connects your work to a business result. Each Key Result lets you measure how close you are to hitting that goal. Conversely, KPIs are used to monitor metrics that reflect ongoing performance, such as average resolution time or sprint velocity.

Here’s a simple way to think about it:

• OKRs answer the question, “Where are we trying to go?”
• KPIs answer, “How well are we doing right now?”

OKRs guide improvement and ambition. KPIs monitor consistency and performance.

Let’s say your goal is to increase customer satisfaction.

• Your KPI might be the NPS score.
• Your OKR might be:
• Objective: Improve the user experience for logged-in users.
• Key Result: Reduce average response time from 2.5s to 1s.

Here’s a breakdown of how OKRs and KPIs differ in purpose, scope, and impact.

• Purpose: OKRs help you drive progress. KPIs help you track status.
• Focus: OKRs are about growth. KPIs follow stability.
• Scope: OKRs are temporary (they can change quarterly or annually, depending on your needs). KPIs stay consistent over time.
• Style: OKRs are inspiring and action-focused. KPIs are purely metric-driven.
• Impact: OKRs help you connect technical work to business goals. KPIs focus more on current engineering performance.
• Team involvement: OKRs involve the whole team. KPIs typically sit with leadership.

More importantly, OKRs also boost morale. A 2022 study found that 78% of employees in companies using OKRs were satisfied at work, compared to 65% without OKRs. Teams using OKRs were also 39% more likely to reach their goals.

Use KPIs to know how you’re doing. Use OKRs to decide what to change and why.

Axify’s Approach: Outcome-Focused, Data-Driven OKRs

Axify helps you focus on tangible outcomes and not just output-oriented tasks. Instead of “perform more tests,” your OKR could be “reduce defect rate by 30%.” That gives your team a goal that means something.

With Axify’s OKR feature, you can set measurable goals directly in your dashboard. You’re tracking metrics and translating engineering data into business impact. Whether you’re looking at deployment frequency, PR cycle time, or other metrics, Axify connects those signals to progress that moves the needle.

Creating an objective in Axify

Once you know what to aim for, let's examine how to set effective engineering OKRs that align with your goals.

How to Set Effective Engineering OKRs

If you want your team to hit real targets (not just move tickets), you need clear, realistic, and tied-to-business-value OKRs. It’s not enough to set goals that sound good on paper; you must build them into how your team works daily.

And that’s great because when your team uses OKRs, they can genuinely see the big picture. 72% of employees with team OKRs understand the company’s vision, while only 50% do without them. Therefore, they know how their work connects to the end goal.

Here is how to write OKRs for software developers:

• Establish business goals that clearly define what matters most right now.
• Tie OKRs to company goals. For example, if the goal is faster time-to-market, set an engineering OKR such as reducing lead time.
• Use meaningful, measurable key results, like cutting PR review time from 48 hours to 24.
• Involve engineers in setting OKRs so there’s buy-in from the start.
• Implement solid feedback loops to track progress continuously, not just at the end of the quarter. Make time to review improvements in retrospectives so teams can reflect and adjust.

These steps help you align your software development team with your company’s goals while keeping everyone engaged and focused.

With your goals in place, let’s look at some best practices that help dev teams follow through and make progress.

Best Practices for Implementing OKRs in Dev Teams

To make OKRs work for your dev team, you need more than good intentions – you need structure, clarity, and regular check-ins. The right practices help your team stay focused and aligned, even during busy sprints. Here are the best ones to keep in mind:

• Keep objectives ambitious but achievable so your team stays motivated without feeling overwhelmed.
• Limit OKRs to 1–3 per quarter to keep everyone focused.
• Make OKRs visible in dashboards so that progress stays front and center.
• Encourage continuous iteration by adjusting based on real-time data.
• Use quantitative key results like in the example above (i.e., “improve PR review time from 48h to 24h”) to keep an eye on what really matters.
• Use DORA and flow metrics to track how work is moving through your development cycle.

Now let’s bring it all together with real example OKRs for software developers that you can apply to your team.

Examples of High-Impact Engineering OKRs

If you want to make real progress, you need OKRs for software engineers that are focused, tied to outcomes, and reflect how your team works. Here are the kinds of OKRs you can use to improve speed, quality, and productivity.

1. Improve Deployment Speed by 50%

• KR1: Increase deployment frequency from 1/ week to 3/ week.
• KR2: Reduce lead time for changes from 10 days to 5 days.
• KR3: Implement CI/CD automation to cut manual deployment steps.

How to Track in Axify:

You can directly measure your deployment frequency and lead time in Axify’s DORA metrics dashboard. It shows you how long it takes for code to go from commit to production and how frequently you deploy. CI/CD progress is easy to follow through Axify’s integrations with your tools, so you always know where things stand.

2. Enhance Code Quality & Stability by 40%

• KR1: Reduce change failure rate from 8% to 4%.
• KR2: Increase automated test coverage from 60% to 85%.
• KR3: Cut Failed Deployment Recovery Time from 4 hours to 1 hour.

How to Track in Axify:

Axify pulls your failure rate and recovery time into your dashboards using DORA metrics. While it doesn’t track code coverage directly, Axify helps you monitor trends like deployment frequency, code review timing, and change lead time—all strong indicators of improving code quality and stability over time. This lets you keep tabs on performance and stability over any period of time without adding manual work.

3. Boost Developer Productivity by 30%

• KR1: Limit WIP per engineer to 2 active tasks.
• KR2: Reduce context switching by integrating tools into one platform.
• KR3: Improve developer satisfaction score from 7 to 8.

How to Track in Axify:

Use Axify’s work in progress and time investment graphs to see how many tasks each engineer handles. You can also track trends in satisfaction with regular feedback prompts built into your collaborative process. Integration with your dev tools shows how much time is spent switching contexts so that you can fix bottlenecks early.

4. Shorten Time to Market for New Features by 50%

• KR1: Reduce time from feature approval to deployment from 20 days to 10.
• KR2: Improve coordination with product managers to reduce scope-change delays.
• KR3: Increase the percentage of PRs merged within 48 hours from 60% to 90%.

How to Track in Axify:

You can use Axify’s Value Stream Mapping to break down each phase of your workflow. This shows where time is being spent and where delays happen, from idea to deployment. Also, you can pair that with metrics like PR merge time and cycle time to spot slowdowns. When you track these regularly, it’s easier to fix blockers before they slow down the whole team.

5. Improve PR Review Efficiency by 40%

• KR1: Reduce average PR review time from 48h to 24h.
• KR2: Ensure 95% of PRs have at least one reviewer assigned within 4 hours.
• KR3: Automate linting and CI checks to cut manual review work.

How to Track in Axify:

Track Lead Time for Changes to measure the time it takes from open to merge. You can use the Value Stream Management (VSM) view to identify blockers such as unassigned code reviews or idle PRs. Axify makes those bottlenecks easy to spot so you can fix them quickly.

6. Improve Product Quality

• KR1: Reduce Change Failure Rate (CFR) from 10% to 5%.
• KR2: Increase automated test coverage from 60% to 85%.
• KR3: Reduce Failed Deployment Recovery Time from 4 hours to 1 hour.

How to Track in Axify:

You can track CFR and Failed Deployment Recovery Time in Axify’s dashboard. These reflect both performance and stability, making it easier for software engineering teams to spot trends and focus on what affects software quality over time. While Axify doesn’t track test coverage directly, its DORA metrics dashboard monitors key trends that correlate with improved product quality.

How to Measure OKR Success

If you're setting OKRs, you need a way to tell whether they work. Success isn’t only about hitting numbers but also about learning, adjusting, and staying aligned. Here are the key steps to measure your progress clearly:

• Before you begin, set baseline metrics. For example, know your current lead time, CFR, or PR review time.
• Track progress using automated dashboards such as Axify. Visual data helps you act fast, and no guesswork is needed.
• Run bi-weekly reviews to catch blockers early and make changes.
• Evaluate results both ways. Use key metrics and team user feedback to see the whole picture.

Conclusion

Getting OKRs right can transform how your team works. You’re not only setting goals but also building focus, improving outcomes, and aligning your work with real impact.

Whether you’re trying to speed up your software development lifecycle, improve software engineering OKRs, or hit more strategic objectives, the way you track and adjust your goals makes all the difference.

Axify gives you the clarity, visibility, and tools to make that happen without adding more overhead. You get real data that helps you act fast and stay aligned.

Ready to simplify how you manage OKRs? Book a demo with Axify and see how it fits your team.