A SMART goal is any goal with a carefully planned, concise, and trackable objective. To be such a goal needs to be specific, measurable, achievable, relevant, and time-based. Bringing structure and trackability to goal setting increases the chances goals will be achieved, and it helps align the organization around those goals.
“SMART” is an acronym which explains how a goal might be achieved. Here is a more detailed look at each letter in the SMART acronym.
S – Specific
When considering the goal, it helps to be as specific as possible. Many individuals and businesses set goals with arbitrary dollar amounts, such as becoming a millionaire or generation 10 million dollars in revenue.
If the goal is to make a certain amount of money, a more specific objective may be to make $40,000 per month for the next 5 years by selling 2500 units of a new software product.
Here, it helps to ask questions. What is it, in exact terms, that an individual or business hopes to achieve? Where, how, and when will this occur? What are the reasons for setting the goal in the first instance?
M – Measurable
Measurable goals have metrics that are used to gauge progress. This is particularly important for large and complex goals that must be broken down into smaller steps.
Measurable goals also let the individual or business know that they have reached the finished line.
A- Achievable
Goals must be realistically achievable, otherwise, the temptation may be to give up on achieving them entirely.
Businesses should set goals that their employees could reasonably expect to see through – given the materials and resources at hand.
It’s also important to identify any short or long term impediments that may divert these resources.
R – Relevant
Relevance means that individuals and businesses set goals that are aligned with their values and long-term objectives.
There is no point setting goals for the sake of it – so ensure that the reasons for conceiving a goal are aligned with broader strategies and company culture.
T – Time-based
Goals by their very definition need a deadline, particularly in business settings. Time-based goals are also important in tracking progress and setting milestones.
For example, a business wanting to double its revenue in 6 months would hope to increase revenue by 50% after the 3-month mark.
Some common mistakes when setting SMART goals
Vagueness
Clarity is key when setting SMART goals. A marketing department might not know where to start when presented with the goal of selling 5000 cars in the next 4 years.
However, the more specific goal of selling 5000 small cars in Italy by the end of 2025 gives them something to work with.
No KPIs
If the goal is to improve customer service, then there must be a customer service KPI with which to gauge progress.
Many businesses make the mistake of setting goals that simply can’t be measured. Here, quantitative or industry research is key.
Unattainability
If a business is particularly successful, it is easy to get carried away with goal setting.
An ambitious goal of selling 1 million pairs of shoes in the next 5 years is daunting and maybe unattainable without the required due diligence. In this case, smaller goals of selling 20,000 pairs every 3 months may be more suitable.
SMART goals examples
Let’s now explain some SMART goal examples across a variety of contexts.
Increasing job performance
In the first example, a small business owner wants to overhaul their website to drive more revenue.
Their goal is to redesign the company website by the end of September so that they can attract more clients.
Specific – I will undertake a complete site overhaul of the company’s website and launch it by September 30.
Measurable – To assist in the process, I will hire the expertise of one web programmer and one graphic designer.
Achievable – With respect to my business experience, existing commitments, and the addition of hired talent, I will devote 10 hours a week to the website to have a functional version online before the official launch on October 1.
Relevant – I recognize that a complete site redesign increases the legitimacy and professionalism of my business and enables me to better market my services to the rest of the world.
Time-sensitive – Since this goal must be achieved by the end of September, I have 2 months to spend on the site. This equates to approximately 90 hours of work.
Increasing the usage of a mobile app
In the second example, we have a SMART goal devised by a product manager at a tech company.
The product manager, which we will Mary, has been tasked with increasing usage of the company’s mobile app and is using the framework to ensure her team remains on track.
Specific – The objective is to grow the number of monthly users via targeted social media campaigns and optimization of the app-store listing.
Measurable – To increase the monthly user count by 2,000. This will be achieved via social media campaigns across Instagram, LinkedIn, and Twitter in addition to app-store optimization.
Achievable – Mary assesses the resources available to her and realizes that social media campaigns for three platforms may be overly ambitious. Rather than fall short, she decides to scale the objective down to the two platforms with the most potential users. These are LinkedIn and Twitter.
Relevant – Since the app in question drives customer retention and loyalty, Mary recognizes that users who stick with the company longer will increase profitability for her employer.
Time-sensitive – To complete the SMART goal, Mary sets a completion date of end of Q1 2023.
Improving response time to customer complaints
In the last example, Jerry, a customer service manager, uses the SMART framework to improve response times to customer complaints.
Specific – Jerry’s goal is to improve the response time to customer complaints by recruiting new employees for his customer service team.
Measurable – The customer service team will add four extra staff in the next six months. This will mean the team is comprised of 12 individuals.
Achievable – Jerry is also moving to a new office soon, so he ensures that he has enough desk space for twelve computers.
Relevant – Reducing customer response time increases sales revenue, improves customer satisfaction, and also increases employee productivity and engagement. Jerry is also cognizant of the fact that he will need to add new clients to justify a staff of 12 over the long term.
Time-sensitive – The four extra staff must be recruited before the company moves to new premises on February 15.
Key takeaways:
SMART goals are those that are carefully planned against certain criteria to increase the chances of them being accomplished.
SMART goals are specific, measurable, achievable, relevant, and time-based.
Some common mistakes when setting SMART goals include those not backed by reliable KPIs or those that are simply unattainable in the recommended timeframe.
SMART Goals vs. OKR
Andy Grove, helped Intel become among the most valuable companies by 1997. In his years at Intel, he conceived a management and goal-setting system, called OKR, standing for “objectives and key results.” Venture capitalist and early investor in Google, John Doerr, systematized in the book “Measure What Matters.”
SMART goals and OKR are very similar tools, however, SMART goals are used more for personal development. Where instead OKR is a goal-setting system primarily thought for teams. So how to enable large organizations to achieve their goals at scale.
Therefore, while in terms of mindset SMART and OKR are similar. SMART goals usually are used more by solopreneurs, where OKR are used by startups and larger organizations.
SMART Goals vs. OKR vs. MBOs
Management by Objectives or MBO is a strategic management tool whose core principle is to define organizational objectives to align management with employees clearly. OKR is an evolution, as it breaks the silos and makes the shared objectives transparent to the whole company.
And those same objectives are aggressive and aspirational. SMART Goals can be used in the direction of OKRs but more at a personal level or at a smaller scale.
OKR and 10x thinking
OKR has been a system widely used in companies like Google to help scale up, while still aligning the company around so-called moonshots. Or small and larger bets that can make the company breakthrough in various verticals.
As OKR is by nature aggressive and aspirational, it fits well with the 10x thinking mindset.
Moonshot thinking is an approach to innovation, and it can be applied to business or any other discipline where you target at least 10X goals. That shifts the mindset, and it empowers a team of people to look for unconventional solutions, thus starting from first principles, by leveraging on fast-paced experimentation.
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Agile Business Analysis (AgileBA) is certification in the form of guidance and training for business analysts seeking to work in agile environments. To support this shift, AgileBA also helps the business analyst relate Agile projects to a wider organizational mission or strategy. To ensure that analysts have the necessary skills and expertise, AgileBA certification was developed.
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Scrum at Scale (Scrum@Scale) is a framework that Scrum teams use to address complex problems and deliver high-value products. Scrum at Scale was created through a joint venture between the Scrum Alliance and Scrum Inc. The joint venture was overseen by Jeff Sutherland, a co-creator of Scrum and one of the principal authors of the Agile Manifesto.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
