The OKW had been formed in 1938 following the Blomberg Affair, which led to the dismissal of Werner von Blomberg.  The OKW was headed for the entire war by Wilhelm Keitel and reported directly to Hitler, from whom most operational orders actually originated as he had made himself Oberster Befehlshaber der Wehrmacht (Supreme Commander of the Armed Forces) and Oberbefehlshaber des Heeres (head of the OKH). Alfred Jodl was Keitel's Chef des Wehrmachtfuehrungsstabes (Chief of Operation Staff), while Walter Warlimont was Deputy Chief. (Wikipedia)

OKW was the only military headquarters in the Third Reich that had a vested interest in obeying Hitler's orders and Hitler probably recognized in it a potentially useful rival to the independent-minded OKH. By 1940 Hitler used OKW to plan and execute a military operation, the invasion of Norway. This initial effort at circumventing the OKH proved successful enough to form the basis of similar ad hoc arrangements in Finland and North Africa in 1941. The OKW capability to provide an alternative command structure, comparable to OKH, grew with these experiences. The OKH, however, remained substantially more capable of conducting military operations.

From a strictly formal perspective, Hitler's status as Führer and Commander in Chief of the Army put the OKW in an untenable position with respect to its relationship to the Army. Commands issued to OKW by Hitler as Führer were ostensibly issued by OKW to Hitler as Commander in Chief of the Army. In practice, the authority structure rapidly devolved into one in which OKH under the leadership of the Chief of Staff became responsible for conducting the war on the Eastern Front while OKW under its Commander in Chief was responsible for conducting the war on all other fronts (including Norway, Finland, North Africa and eventually the Balkans, Italy and western Europe). This division of responsibilities was formally accepted during 1942. However, a great deal of bureaucratic infighting continued as a result of the confused relationship between OKW and OKH. (Zuljan.2000)