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OKR vs. Smart Goals: What Are the Differences and When to Use Them?

SMART goals (specific, measurable, achievable, relevant, and time-bound) and OKRs (Objectives and Key Results) are both methods for defining objectives or goals for a project, team, or organization.

Over the last three decades, SMART goals have provided a structured method for achieving goals and focusing efforts. However, startups and multinational firms have increasingly adopted OKRs, focusing on the bigger picture. 

We can compare SMART goals to the Key Results of OKRs. But how do OKRs vs. SMART goals-setting approaches differ, and can we use them together? But before you continue reading this article, we encourage you to get familiar with the fundamentals of OKRs and then proceed to OKRs vs. SMART goals. 

OKRs vs. SMART Goals: What’s the Difference?

The main difference between OKRs and SMART goals is that OKRs focus more on outcomes and growth, while SMART goals focus more on specific, measurable targets. OKRs prioritize setting ambitious, aspirational objectives that align with the organization's overall mission and vision and then breaking those objectives down into measurable key results to track OKRs' progress. SMART goals, on the other hand, prioritize setting specific, measurable targets that are achievable within a specific timeframe.

How SMART Goals and OKRs Are Similar?

Goal-setting approaches such as SMART goals and OKRs are based on the concept that achieving business and organizational success requires setting clear objectives. Both provide specific steps to help you develop a realistic and time-bound plan for reaching your goals.

SMART goals and OKR are about removing the "vagueness" from the process of setting and achieving goals. Each approach focuses on measuring success based on outcomes, not just on the number of completed activities. And both OKRs and SMART teach you to be specific with your objectives.

However, the similarities between the two end here. Where SMART goals end, OKRs take over.

What Is OKR?

Objectives and Key Results (OKR) is a popular framework used for setting goals in organizations. A key purpose of the company OKRs is to align the strategic goals with their actual execution to create a unified vision of success.

Objectives are more ambitious and even visionary, whereas Key Results are more numeric and measurable. Applying the hierarchical structure of OKRs ensures the alignment between company plans and work execution.

A Simple Example of OKR

Let's see how to set up a simple OKR example of a content website in the healthcare industry.

Objective: Become the leading content platform for healthcare professionals seeking the most up-to-date research papers in healthcare.

Key Results:

  1. Increase the number of published healthcare research papers per month from 10 to 20 articles.
  2. Increase the exposure of our platform in industry-specific digital media from 15 to 20 featured articles per month.
  3. Increase our platform’s uptime each month from 94% to 99%.

What Are SMART Goals?

“When it comes to writing effective objectives, corporate officers, managers, and supervisors just have to think of the acronym SMART. Ideally speaking, each corporate, department, and section objective should be: (SMART).” - George T. Doran

SMART goals are a set of guidelines that help you set goals that are specific, measurable, achievable, relevant and time-bound.

The SMART acronym was introduced in November 1981 by George T. Doran. George was a former Director of Corporate Planning for the Washington Water Power Company. The paper he published was called “There’s a S.M.A.R.T. Way to Write Management’s Goals and Objectives.”

Let’s explain the meaning behind each characteristic of Doran’s SMART approach

  1. Specific. Goals should be specific, so we can have a clear path to what we want to achieve with that specific goal.
  2. Measurable. Goals should have measurable outcomes to track progress.
  3. Attainable. Goals should be achievable so that the person will not give up on them too soon.
  4. Relevant. Goals should be relevant to the person and their career goals in the organization.
  5. Time-bound. Goals should have an established deadline.

An Example of When to Use SMART Goals

A big brand in the tech niche used the SMART goal-setting process to accomplish their organic traffic goal.

Goal: Increase organic traffic by 30% within six months.

  • Specific: The brand will increase its website organic traffic by 30% in six months.
  • Measurable: Optimize five mid-traffic articles per month to increase their organic ranking.
  • Attainable: If each of the five editors from the marketing team finds and optimizes one article per month, the goal becomes realistic and doable.
  • Relevant: Organic traffic is the primary traffic source for the brand's website. This goal is the most stable way to increase organic traffic, and its success will add to the overall business's success.
  • Timely: The goal will be accomplished from date “X” to date “Y.”

What Are the Differences between SMART Goals and OKRs?

There are five significant differences between OKRs and SMART goals that set the two goal-setting approaches apart.

1. SMART Goals Focus Mainly on the Objective

OKRs always consist of Objectives and Key Results attached to each objective. SMART goals are a list of principles that help you create an objective without focusing on the tactics to achieve that goal. 

SMART goals focus on the question—what is the goal? Where OKRs provoke the questions—what is the goal, and how can I reach it? With OKRs, there is an additional layer of ownership for getting closer to a wider vision which happens by gradually reaching its correlated key results.

2. SMART Goals Are a Guideline, Rather than a Framework

Even though SMART goals offer structured criteria used to craft the process of defining goals, they are not a framework. SMART goals are a guiding set of principles or an approach for setting and building goals.

3. SMART Goals Are Frequently Tied to Compensation

SMART goals are often tied to compensation. In OKRs, employees’ performance is not tied to compensation. A key advantage of OKRs is the "dare to fail" mentality, which promotes innovation and stretching beyond existing capabilities since compensation is not tied to them.

4. SMART Goals Are Less Agile

Usually, organizations set SMART goals annually, whereas the cycles of OKRs are quarterly or monthly. This makes OKRs more agile than SMART goals.

5. SMART Goals Are Naturally Risk-Averse

Employees are expected to achieve their goals fully when their performance is linked to their goals, which is often the case with SMART goals. This means that employees’ goals are often set in the safe zone.

OKR and SMART goals have different uses. When choosing which method to use, consider that OKRs are primarily used when your organization or teams want to measure and achieve a very ambitious goal or vision. SMART goals are mainly used for setting daily goals, where these goals don't have to necessarily contribute directly to the larger-scale strategic plan of the organization.

When to Use OKRs vs. SMART Goals?

OKRs (Objectives and Key Results) are best used when an organization or individual wants to set ambitious, measurable goals that align with their overall strategy. They are particularly useful for setting long-term goals and tracking progress toward achieving them.

SMART goals, on the other hand, are best used when an organization or individual wants to set specific, measurable, achievable, relevant, and time-bound goals. They are particularly useful for setting short-term goals and ensuring they are realistic and achievable within a specific timeframe.

In summary, OKRs are useful for setting ambitious, long-term goals, while SMART goals are guidelines useful for setting specific, short-term goals that are achievable within a specific timeframe.

What Are the Strengths and Weaknesses of OKRs vs. SMART Goals?

OKRs and SMART goals are two popular goal-setting approaches organizations use to measure performance and drive success. Both methods have their strengths and weaknesses.

One major strength of OKRs is their focus on outcomes rather than activities. OKRs outline specific objectives and key results that are measurable and aligned with the organization's overall mission. 

This approach provides clarity and direction, motivating employees to work toward a common goal. Additionally, OKRs encourage a culture of transparency and accountability, as progress is regularly tracked and reported. 

However, one potential weakness of OKRs is that they may be too ambitious or unrealistic, leading to disappointment and demotivation if they are not achieved.

On the other hand, SMART goals are highly effective in breaking down complex tasks into smaller, more manageable components. These goals ensure that targets are specific, measurable, achievable, relevant, and time-bound, making them easier to track and accomplish. 

SMART goals are also adaptable, allowing organizations to adjust their goals based on changing circumstances. 

However, a potential weakness of SMART goals is their focus on the individual rather than the organization as a whole. The rigidity of SMART goals can also be a weakness. Focusing on specific metrics can lead to tunnel vision and neglect of other vital aspects of the business.

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Iva Krasteva

Iva Krasteva

Content Creator Expert | Agile Practitioner | Kanban Certified

With a background in Intellectual Property, SEO, content writing, and training in Lean, Agile, and Kanban, Iva is an enthusiastic Agile practitioner who embraces collaboration and flexibility every step of the way. Driven by constant learning and knowledge and fascinated by people's creativity.

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