OKRs vs. Rocks vs. SMART Goals: What’s Better for Your Business?
In business, whether we succeed depends on which direction we’re going. And that direction? It’s determined by the goals we set and how we go about completing them.
Of course, corporate goal-setting involves more than jotting down a to-do list on a notepad. Successful goal-setting requires a methodical approach—one that’s repeatable and measurable.
You may already be familiar with the three most popular goal-setting methodologies:
- SMART goals
- Rocks
- Objectives and Key Results (OKRs)
Here, we’ll compare all three methodologies and explain where they overlap and where they differ. We’ll also show you why, at Crews and co., we use OKRs for our internal teams and our clients. OKRs have proven so effective that they have become a key element in our proprietary business operating system, the Growth Method.
Keep reading to learn more about each approach and discover the right goal-setting method for your business.
Understanding the Most Popular Goal-Setting Methodologies
You’ll know your team is using the right goal-setting strategy when you observe these critical outcomes:
- Whole-company alignment. From leadership to the front lines, your team shares a unified vision for where the company is going and how it will get there.
- Enhanced productivity. Every team member knows what’s expected of them and where to focus their energy.
- Measurable results. A clear framework quantifies every achievement and identifies areas for improvement.
So, which approach can have the greatest impact on your team? Let’s break down what SMART goals, Rocks, and OKRs are actually are first.
Understanding SMART goals
SMART goals are often one of the first goal-setting methodologies that a business leader encounters—they’ve been around since a paper was published on them in 1981. The SMART approach demands that every Objective (yes, SMART used this term as well) be:
Specific: What is the Objective? Who is responsible?
Measurable: How many? How much?
Achievable: What reasonable step will we take to reach the Objective?
Relevant: What is the big-picture purpose of the Objective?
Time-bound: What is the timeline for achieving the Objective?
Take a look at these SMART goals examples:
EXAMPLE
Specific: Increase subscription sales
Measurable: …by 1,500 new subscribers
Achievable: …by hosting a weekly podcast
Relevant: …that expands the company’s reach
Time-bound: …by the end of Q4
EXAMPLE
Specific: Increase user in-app time
Measurable: …by 20%
Achievable: …by implementing banner promos
Relevant: …that increase feature awareness
Time-bound: …within the next 90 days
Understanding Rocks
The Rocks methodology was inspired by American businessman Stephen Covey’s metaphor for prioritization in his 1994 book First Things First, where he describes trying to fit big rocks, pebbles, sand, and water into an empty jar.
In the methodology, the jar represents your workday, and the Rocks represent your top priorities. Pebbles represent your secondary priorities, sand represents minor tasks, and water represents distractions.
If you fill your jar—your workday—first with water, then sand, then pebbles, you’ll run out of space (time) for the Rocks. Instead, Covey’s mindset guides individuals to prioritize their Rocks first and foremost as shown in these highly focused Rocks goal examples:
EXAMPLE
Host a weekly podcast to earn 1,500 new subscription sales by the end of Q4.
EXAMPLE
Implement banner promos to increase user in-app time by 20% within 90 days.
Rocks can be thought of as a prioritization tool, and they are typically written as SMART goals as well. They are used in the Entrepreneurial Operating System, or EOS, as a way for teams to identify the top company and individual goals. In the EOS framework, Rocks are 90-day goals, set and reviewed on a quarterly basis.
Understanding OKRs
Born at Intel, popularized by John Doerr’s book Measure What Matters, and championed by companies like Google, OKRs are a powerful blend of aspirational goals (Objectives) and SMART, actionable tasks (Key Results). For a deeper dive, check out our posts on an introduction to OKRS and how to score OKRs.
In a single OKR, each Objective is accompanied by several Key Results that serve as milestones toward achieving the Objective. OKRs can be set at the company level, at the departmental level, and at the individual level for anyone in the business. When fully executed in an organization, OKRs cascade through the business, with team members at every level finding ways they can contribute to the overarching vision.
As you’ll see in these examples, OKRs often include elements of SMART goals and Rocks:
EXAMPLE
Objective: Add 1,500 new subscription sales by the end of Q4
- Key Result: Host a weekly podcast
- Key Result: Obtain guest spots on 3 podcasts popular with our target market
- Key Result: Sponsor 3 podcasts popular with our target market
EXAMPLE
Objective: Increase user in-app time by 20% within 90 days
- Key Result: Implement in-app banners that promote features
OKRs often have an Objective that is “soft” and less specific, while the Key Results are “hard” and tend to align more closely with the SMART approach. OKRs can be set across any time frame. At Crews & co., we incorporate OKRs into even our longer-term planning. In addition to Quarterly OKRs, we help clients set 3 Year Objectives and Annual Objectives as well.
Comparing Methodologies: OKRs vs. SMART Goals
People often pit OKRs and SMART goals against one another, but they’re two distinct goal-setting techniques that can—and should—work together to move your business forward. With a SMART mindset, you’ll ensure your OKRs are precise and actionable at every level.
However, there are three distinctions that clearly set OKRs apart from the simpler SMART goals.
1. Perspective
OKRs are future-focused. Objectives motivate teams to dream big and push boundaries, challenging themselves to reach and innovate. Every Objective is supported by Key Results that anchor the Objective with measurable outcomes that get scored against a spectrum of completion.
SMART goals are not OKRs, but OKRs can be SMART: specific, measurable, achievable, relevant, and time-bound. By leveraging a SMART approach with your OKRs, you’ll have envelope-pushing Objectives enabled by clear, feasible Key Results.
2. Flexibility
OKRs provide flexibility that SMART goals alone don’t allow. Where SMART goals are intended for 100% completion, OKRs leave room for individuals to achieve only, say, 80% of a Key Result and still consider it successful.
Unlike SMART goals, the intentionally aspirational OKRs are meant to be evaluated for complexity as well as completeness. OKRs don’t get crossed off a list; they get reviewed by entire teams and adapted, adjusted, repeated, and repurposed as needed.
3. Cadence
While SMART goals always come with a deadline since they’re time-bound, they aren’t set on a specific cadence. OKRs can be set on any time frame as well, but that time frame typically applies to a set of OKRs rather than each goal having its own deadline. In the Growth Method, we set 90-day OKRs and also help businesses put their annual goals (Annual Objectives), 3-year goals (3 Year Objectives) and even 10-year goal (North Star) into OKR format.
This approach connects the dots between your company’s ultimate Objective and every OKR leading up to it, which helps your business eliminate silos and align teams to a common purpose with a shared methodology.
Comparing Methodologies: OKRs vs. Rocks
OKRs and Rocks both provide direction, but they’re far from identical. Where OKRs are almost endlessly adaptable, Rocks can embody a rigidity that inhibits spontaneity or recalibration—factors that many modern companies value. And while some say Rocks are just Objectives by another name, Objectives differ from Rocks in scope and measurement.
1. Scope
Rocks are typically set at a leadership level, with leaders identifying three to seven top priorities (Rocks) for the next 90 days. However, because Rocks don’t always penetrate throughout the company, they may not provide direction at every level. As a result, Rocks have the potential to further silo teams and individuals, potentially causing misalignment.
OKRs, on the other hand, are designed to cascade down throughout the rest of the organization. Company, Departmental, and Individual Objectives should all align. That said, OKRS aren’t exclusively top-down. Every level of the business has the autonomy to bubble up priorities and to align with Company Objectives as they see fit.
This first OKR example shows how a Company Objective triggers Key Results that become Departmental Objectives and so on:
EXAMPLE
Company Objective: Expand nationwide
- Onboard 10 new sales representatives (HR)
- Run ad campaigns in 10 new states (Marketing)
Departmental Objectives:
Onboard 10 new sales representatives (HR)
- Publish new career openings
- Interview 30 candidates
Run ad campaigns in 10 new states (Marketing)
- Design a new print ad - creative and copy
- Hire digital marketing consultant
In this next OKR example, you’ll see how a Departmental Objective can trigger inter-departmental collaboration, breaking down silos between teams:
EXAMPLE
Sales Department Objective: Add 1,500 new subscription sales by the end of Q4
- Target 3 new prospects daily (Sales)
- Host a weekly podcast (Marketing)
- Sponsor 3 podcasts popular with our target market (Strategic Partnerships)
2. Completion
Rocks strictly focus on a company’s most pressing quarterly priorities. At the end of 90 days, there are only two possible results: they are either complete or incomplete. As a result, Rocks can get “sandbagged,” with teams setting goals that feel achievable instead of pushing themselves to make progress on bigger stretch goals.
OKRs, however, are inherently ambitious. Their “done-ness” gets evaluated against a range of success markers (1-10 scale, based on completion but also effort involved), and 80% completion is broadly considered an acceptable standard. As a result, the methodology inherently encourages stretch goals over safe, easily achievable ones. Learn more about the specifics of OKR scoring here.
Our Take: OKRs Are More Powerful than Rocks and SMART Goals Alone
As your business evolves, so will its needs. Yet SMART goals and Rocks aren’t known for their ability to evolve.
While SMART goals ensure precision, they can also stifle creativity; not every goal can neatly line up with the SMART framework. Take a more visionary goal such as, “Create a great workplace culture.” It’s a valuable goal, but it doesn’t meet the SMART criteria.
Rocks also tend to exclude visionary goals, instead prioritizing attainable 90-day goals that may not ultimately advance the business toward bigger-picture priorities.
As you’ve seen, OKRs are built for complexity and nuance. Let’s recap what we love most about the OKRs methodology:
OKRs are versatile
OKRs allow a business to set sweeping, ambitious, and even somewhat nebulous Objectives, then craft a SMART roadmap of Key Results that establish milestones and drive accountability. If the Objective is the destination, the Key Results are how you’ll get there. Making Key Results SMART empowers teams to optimize their time and talent.
OKRs enable whole-company alignment
OKRs are transparent to everyone, from C-level executives to individual frontline workers. The entire team benefits from an unobstructed view of their contributions to the company’s overarching goals.
OKRs promote ambitious goal-setting
OKRs are scored on a 1-10 spectrum that leaves room for both ambitious goal-setting and the often challenging realities of execution. In many cases, achieving 80% of an ambitious goal propels the team further than achieving 100% of a safe goal.
Goal-Setting for Growth
While all three methodologies we’ve reviewed—SMART goals, Rocks, and OKRs—seek to provide businesses with clarity and direction, each has its own best-use scenarios. Your choice should be informed by your company’s size, industry, culture, and growth phase. Ultimately, any goal-setting methodology is better than none at all.
The SMART methodology can be woven into any goal-setting approach.
Rocks revolutionized the business world’s take on goal-setting and prioritization, and many companies have advanced with Rocks as a guiding force.
OKRs deliver the best of SMART goals and Rocks along with versatility, vision, and unity of purpose. If your team is ready to soar toward growth, OKRs may offer the wings you need.
Let Crews & co. show you how to use OKRS to achieve profitable growth. Work with us.
