SMART Goals vs. OKRs: Choosing Between Goal-Setting Methods

OKRs (Objectives and Key Results) are a popular form of goal setting in large corporations like Google, Facebook, and LinkedIn. The goals are specific, measurable, realistic, timely-oriented (deadline) oriented, company-related SMART goals.

This post discusses the differences between OKRs and SMART goals to help you decide which works best for your organization or personal needs.

OKRs vs. SMART Goals

What are the differences between the two goal-setting models?
Objectives and Key Results (OKRs) are similar to SMART goals in that they both require the following:

Specific: Companies such as Google use four-word objectives such as “Increase active users by 20 percent” with corresponding measurable results such as “Increase daily active users from X to Y by March 1st.”

Measurable: If you can’t measure it, you can’t manage it. Both SMART goals and objectives must have a way of tracking results.

Results-oriented: Both SMART goals and objectives are aimed at getting results. The difference is the time frame in which the results are achieved.

Time-bound: Both SMART goals and OKR objectives must have a deadline, although the time frame differs between companies that use this model.

Company-related: It’s important to note that OKRs are only considered company-related if they are tied to company-wide objectives. For example, if Google is using an “increase active users by 20 percent” goal, it must be tied to the overall company objectives like “Accelerate user growth by improving product features.”

All goals should be SMART

There isn’t anything wrong with using OKRs or SMART goals related to their key performance indicators (KPIs). Both goal-setting systems are actually designed to help managers set goals that are specific, measurable, realistic, timely-oriented (deadline), and company-related. OKRs are, when done correctly, also SMART.

It’s important to note that you don’t have to use SMART goals or OKRs at all.

Why? Many companies feel that they should match their goals with an objective system based on their mission or vision. For newer companies, specific numerical goals can be hard to predict, and thus achieve. The numbers chosen for goals might seem arbitrary. Or, partway through the time-period to achieve the goal, it may become clear that the specific number target is impossible to hit.

In this case, managers might decide to use SMART goals with their company or organization strategy in mind, but to update the target over time based on what they are measuring. (For example, see these digital marketing KPIs.)

Or, instead of measuring something like revenue or profits, you can measure an activity that leads to those things.

For example, you might decide to use SMART goals to focus on increasing collaborative efforts among departmental managers, but not require that you track any other type of measurement. Measuring the time spent collaborating or other soft metrics are other ways that OKRs can help highlight progress towards achieving company-wide goals.

Choosing between OKRs and SMART goals

Using an objective goal system isn’t for everyone. Some companies may be satisfied with simply having clear expectations for employees without setting objectives or key results.

However, having a mission, vision, and clear goals helps provide a sense of direction.

With OKRs come a lot of resources, some from Google themselves, on using the system to improve your organization. Many companies like to use OKRs that are also cascading goals, a strategy that aligns the goals of the entire organization.

SMART Goals, on the other hand, is more of a rule-of-thumb. It's not necessarily specific system with loads of expert advice built around it.

Bottom line: For something simple, easy, and quick to get started, stick to making sure all of your goals are SMART and align them with your priorities. And if you want to take it to the next level, consider the OKRs framework.