If you’re struggling to hit your business goals, you’re not alone. Many companies struggle to choose between two powerful goal-setting frameworks: OKRs (Objectives and Key Results) and SMART Goals. But which one should you use to push your team toward success?
OKRs are known for inspiring ambition and long-term strategic thinking. They help teams aim high and align efforts toward bold, transformative outcomes. SMART Goals, on the other hand, provide clear, achievable targets that keep teams focused on measurable, short-term success.
So, which is better for your organisation? Should you go for the aspirational approach of OKRs or the precise, tactical nature of SMART Goals? This blog will break down the differences and help you choose. Plus, we’ll show you how combining both can lead to more impactful results.
OKRs (Objectives and Key Results) and SMART Goals are two frameworks that help organisations set and achieve their goals. While both aim for success, their approach and application vary significantly.
What are OKRs?
OKRs are designed to align teams around high-level objectives and measurable key results.
Objective: A qualitative goal that sets the direction. It should be aspirational and ambitious, challenging the team to aim higher.
Key Results: These are quantitative, measurable milestones that track progress toward achieving the objective. Key results help teams know when they’ve achieved the objective and provide clear markers of success.
OKRs are often used in fast-paced, high-growth environments. They promote organisational progress and create team alignment with ambitious, long-term goals.
What are SMART Goals?
SMART Goals focus on defining clear, specific, and achievable targets. This framework uses the following criteria to ensure that goals are actionable:
Specific: Clear and well-defined.
Measurable: Quantifiable so that progress can be tracked.
Achievable: Realistic and attainable within the given resources.
Relevant: Aligned with broader organisational goals.
Time-bound: Set within a specific timeframe for completion.
SMART Goals are practical and tactical. They work well for individuals, departments, or smaller teams that need a clear focus and defined outcomes within a short period.
Example Scenario: OKRs vs SMART Goals
Let’s say you’re leading a company's product team aiming to improve customer satisfaction. You want to set goals for the next quarter:
With OKRs, your objective could be: “Increase customer satisfaction significantly.” The key results might include: “Increase satisfaction score by 20%” and “Resolve 90% of customer complaints in under 48 hours.” These ambitious and long-term goals drive innovation and challenge the team to perform at a high level. OKRs work well when you want to keep everyone in the organisation moving toward a unified, strategic vision.
With SMART Goals, a specific goal might be “Increase customer satisfaction by 10% in the next 3 months.” This goal is clear, focused, and measurable. The team knows exactly what they need to achieve and by when, with a concrete target, they can work toward in the short term. This is ideal for situations where you must implement an action plan that can be executed and measured within a fixed timeframe.
Key Differences in Approach
Scope: OKRs tend to be broader and more aspirational. They focus on long-term outcomes and are often set to inspire teams. SMART Goals, on the other hand, are typically more focused and tactical. They aim to achieve specific results within a set period.
Flexibility: OKRs allow for flexibility and adjustment. If you hit one key result early, you can adjust the remaining results to continue pushing the team. SMART Goals, being time-bound and often more rigid, don't allow for as much flexibility in the approach once they are set.
Focus: OKRs clarify what needs to be achieved and encourage stretching beyond limitations. SMART Goals focus on what can be achieved in a specific timeframe and ensure everyone is aligned toward a common, realistic goal.
As we’ve seen, OKRs and SMART Goals each have their strengths, depending on the context and desired outcomes. Let’s now explore how their ambition levels differ and how they impact employee motivation and focus.
When it comes to goal-setting frameworks, one key difference between OKR vs SMART Goals is the level of ambition they encourage.
OKRs: Aspirational and Strategic
OKRs are designed to push teams beyond their current abilities. They inspire innovation and set bold objectives that align with long-term company visions. For instance, a company aiming to dominate its industry may set an OKR like "Increase market share by 20% within the next year through global expansion." This type of objective encourages strategic thinking and creative problem-solving and requires teams to work on initiatives to reach the end goal.
Example: A tech startup focused on scaling up might set an OKR like, "Launch 3 new product features in the next 6 months that will enhance customer retention." The key results would focus on specific, measurable targets, such as launching beta tests, obtaining customer feedback, and tracking user engagement metrics. The goal here is challenging but achievable, with a focus on long-term impact.
SMART Goals: Tactical and Short-Term Focused
In contrast, SMART Goals are more practical and tailored to measurable results that are within reach. They follow a clear structure that is Specific, Measurable, Achievable, Relevant, and Time-bound, making them more suitable for setting short-term, actionable goals.
Example: A marketing team might set a SMART goal like, "Increase email open rates by 15% over the next quarter by improving subject lines and personalisation." This goal is concrete, measurable, and achievable within the short term. It provides a clear direction for team members to follow and is less about the long-term strategic direction than a typical OKR.
While OKR vs SMART Goals vary in their scope, both serve important roles. OKRs encourage forward-thinking and innovation, while SMART Goals keep the team focused on achievable, day-to-day tasks.
One of the biggest challenges businesses face is measuring progress effectively. Whether you're tracking long-term strategy or short-term milestones, it’s important to have a clear system. OKRs vs SMART Goals: Each offers different approaches to measuring success, but understanding how they align with your business goals can help you decide which is better suited for your team. Choosing the wrong method might lead to misaligned objectives and missed opportunities.
Metric Measurements in OKRs vs SMART Goals
OKRs often track success using a mix of qualitative and quantitative metrics. Since they are broad and aspirational, they focus on the outcome and impact. Success is measured by how well the key results contribute to the larger objective.
The success of these key results is evaluated by how much they contribute to the business goal. Progress is tracked along the way, but the focus is on long-term impact.
In contrast, SMART Goals focus more on specific, measurable outcomes. The goal is clear-cut, with precise metrics to measure success within a set time frame.
How Measurability is Achieved
Both OKR and SMART Goals frameworks emphasise measurable results but differ in scope. OKRs are more fluid and can adapt as goals evolve. They focus on tracking impact rather than just numbers.
On the other hand, SMART Goals are static and clear-cut. Success is evaluated purely based on whether the criteria are met within the timeline.
When it comes to setting goals, you’ve probably heard about OKRs and SMART Goals. On their own, both can help your organisation stay focused and drive performance, but what happens when you combine them? Let’s look at how using both frameworks together can lead to a more balanced and effective approach.
OKRs and SMART Goals: What They Have in Common
Even though OKRs and SMART Goals are different in how they’re structured, they do share some key similarities that make them both useful:
Measurable Goals: Both frameworks focus on measurable outcomes. OKRs define key results with numbers, while SMART Goals emphasise specificity and measurableness.
Strategic Focus: Both systems aim to connect individual or team efforts to larger organisational objectives. OKRs are broad and strategic, while SMART Goals focus on the specific actions needed to achieve them.
Tracking Progress: With both frameworks, you’re tracking progress along the way, which helps keep your team on course and adjusts when needed.
Using SMART Goals as Key Results in OKRs
One of the easiest ways to integrate SMART Goals into OKRs is to use SMART Goals as key results. This approach ensures that the high-level goals in your OKRs are broken down into clear, achievable steps.
Example: Let’s say your overall objective is to “Increase brand awareness in the European market.” You might set SMART Goals as key results to track your progress:
Grow website traffic from Europe by 30% in the next quarter (specific, measurable, and time-bound).
Increase social media engagement by 15% by the end of the year (specific, achievable, and measurable).
This way, OKRs give businesses that ambitious goal to aim for, while SMART Goals help them define exactly what steps they need to take to get there.
Why a Combined Approach Can Benefit Your Organization
By blending OKRs with SMART Goals, businesses can create a more adaptable and focused strategy for their teams. Here’s why this combined approach can work wonders:
Flexibility and Clarity: OKRs help organisations keep their long-term objectives in sight, while SMART Goals help them focus on measurable, time-bound actions to achieve them. This mix ensures that your business can adjust as needed without losing track of your end goal.
Clear Roadmap: Having both frameworks gives businesses a roadmap that’s both strategic and actionable. OKRs set the direction, and SMART Goals outline the practical steps to achieve it.
Motivation and Accountability: The OKRs give your team something to strive for, while SMART Goals make sure everyone stays accountable with concrete, measurable outcomes.
This combination gives a clear, high-level goal while also providing measurable, actionable steps.
Choosing between OKRs and SMART Goals doesn’t have to be complicated. OKRs provide the big-picture vision and flexibility to guide your long-term strategy, while SMART Goals offer the clarity and structure needed to make measurable progress in the short term. When used together, these frameworks allow you to cover all your bases while balancing ambition with action and ensuring your team stays on track toward success.
But achieving those goals requires more than setting them. Craze can help you stay organised, track progress, and achieve results. With Craze’s Goals & OKR software, you can easily manage both OKRs and SMART Goals, track real-time performance, and adjust strategies on the fly, ensuring you're always moving forward.
If you’ve been struggling with goal clarity or progress tracking, Craze can simplify it all. Organise your goal-setting process, make informed decisions, and transform your team’s performance. Ready to see results? Get started with Craze.
