A method for easily calibrating both the position of the tip of a surgical tool and the orientation of that tool includes attaching a tracking device capable of communication with the surgical navigation system to the surgical tool using an adapter, where the adapter has a known relation between the tracking device and the axis of the surgical tool. The method then performs a calibration process to calculate the position of the tip of the surgical tool and the position of the tracking device and orientation data for the surgical tool from the known relation between the tracking device and the axis of the surgical tool and from the tool tip position. Lastly, the method stores the position of the tool tip for the surgical tool and the orientation data within memory of the surgical navigation system so the position and the orientation of the surgical tool can be tracked by the surgical navigation system.The adapter has a body with an interior surface that defines an opening through which a surgical tool can be inserted, the opening having an axis. The adapter also has a docking structure for a tracking device such that there is a known relation between the tracking device and the axis of the opening and the axis of a tool that is inserted in the opening.