Preheat your oven to 350°F (175°C) and line a baking sheet with parchment paper.
In a large mixing bowl, cream the softened butter and powdered sugar together until light and fluffy.
Add the vanilla extract and orange zest to the butter mixture, mixing well until combined.
Gradually add the all-purpose flour and salt, mixing until the dough starts to come together.
Gently fold in the chopped dried cranberries until evenly distributed throughout the dough.
On a lightly floured surface, shape the dough into a log about 2 inches in diameter. Wrap it tightly in plastic wrap and chill in the refrigerator for about 30 minutes.
Once chilled, remove the dough from the refrigerator and slice it into ¼-inch thick rounds.
Roll each round in granulated sugar to coat, then place them on the lined baking sheet, spacing them about an inch apart.
Bake in the preheated oven for 12-15 minutes, or until the edges are lightly golden.
Remove from the oven and let the shortbread cool on the baking sheet for 5 minutes before transferring to a wire rack to cool completely.