Many of our clients and potential clients have previously used a SMART goal framework to execute strategy. Their first question of us is typically, “What is the difference between SMART goals and OKRs.” We’ll explain the similarities and differences between these two goal-setting frameworks in this article. And, in a bit of a pivot, we’ll detail the best practices of how you would use the SMART method in an OKR (Objectives and Key Results) environment.
The S.M.A.R.T. Goal-Setting Method
The SMART method was first introduced in the November 1981 issue of Management Review in a paper authored by George T. Doran titled, “There’s a S.M.A.R.T. Way to Write Management Goals and Objectives.”
SMART is an acronym that sets the criteria for setting goals and objectives. The SMART approach, which stands for Specific, Measurable, Attainable, (sometimes referred to as Aligned), Relevant, and Time-Bound, is used to develop goals that are concrete and geared towards execution in a defined period.
S. Specific, provides a clear description of what needs to be accomplished M. Measurable, provides a metric, or number, that identifies when the objective has been achieved A. Attainable, the objective must be achievable, within the timeframe and resources allocated R. Relevant, meaningful, significant, and aligned with corporate priorities T. Time-bound, the objective must be concluded by a specific date, scoring occurs at this time to determine if the objective has been achieved.
The OKR Methodology
In his book, “Measure What Matters,” author John Doerr tells us that OKRs (Objectives and Key Results) is a collaborative goal-setting protocol for companies, teams, and individuals.
The Objectives (Os), are WHAT is to be achieved. They should be significant, concrete and action-oriented. They represent the direction.
Key Results (KRs) benchmark and monitor HOW we get to the objective. KRs should be succinct, specific, and measurable. KRs typically include hard numbers.
SMART Goals and OKRs – Similarities in the Methodologies
The first similarity is that both frameworks provide the criteria for developing goals. Second, they are similar in that both methods address each element of the SMART acronym.
Objectives and Key Results, encompass each of the criteria of SMART Goals:
- Objectives are Specific, answering What needs to be accomplished
- Key Results are Measurable, they are typically metrics or numbers which define when the Objective is achieved
- They are Attainable, yet inspirational, and in some cases aspirational. Aspirational goals require more of a stretch by the organization and may need to be rolled from period to period before being accomplished
- Objectives are Relevant. They must be aligned with corporate priorities, moving the organization in the desired direction
- Key Results are Time-Bound, the typical cadence in an OKR environment is quarterly. KRs are expected to be completed within the current quarter
Differences in SMART Method and OKR Methodology
As indicated above the two protocols are similar in how they set the criteria for goal setting. However, where the SMART method ends, the OKR methodology continues. In OKRs you not only set the goals but provide for the ongoing monitoring and tracking of progress through Key Results. And, in an OKR implementation, the KRs are monitored regularly through Check-Ins, where progress is updated, and obstacles and roadblocks are identified. This ongoing monitoring serves two purposes: 1. Impediments to the achievement of the desired outcome can be course-corrected in real-time, and, 2. The learnings from this feedback are incorporated into the planning process for subsequent quarters. OKRs are far more agile with their quarterly cadence as opposed to SMART goals which tend to be set annually.
Best Practices Using the SMART Method When Setting OKRs
Ensure each OKR encompasses all the components of the SMART acronym.
When setting OKRs, the Objective needs to be Specific and should be significant as well. Objectives should not be of the “business as usual” variety.
The Key Results contribute to the Measurable component. When addressing the KR, it also helps to think of KPI’s, metrics, numbers.
The Objective should be Attainable; however, as previously stated OKRs are ideal for setting goals which stretch the organization, creating enthusiasm and engagement.
Objectives must be Relevant. A great way to ensure your Objectives are relevant and in keeping with your corporate goals and values is to review your Mission, Vision Statement, and Strategic Pillars to ensure your goals will achieve the desired outcomes.
Your Key Results meet the Time-Bound component of SMART in that they are expected to be accomplished in the current period, typically a quarter in an OKR environment.
If you’re considering moving from SMART goal-setting to OKRs, we hope this article has helped to guide you as to where, and how to start.
Do you manage a company or teams (either as a CEO, a senior executive, a middle manager or even a front-line manager)?
Do you set and track objectives? Does aligning employee performance to business goals matter, and are you responsible for driving results? If so, please check out a live demo of Atiim OKR & Goals Management Software and we’d love to hear what you think about it. Thank you!