Imagine two companies — both sell jam, flaunt the same market share and have 20 employees, one factory and a dog as an office mascot. Which peddles more jam? The one using SMART goals.
When properly executed, the SMART goal-setting method is a foolproof way to bring you closer to your business goals. But how can you be sure you’re doing it right? In this article, we’ll explain what SMART goals are, why they’re important and most importantly, how to write them.
What is a SMART goal?
The SMART framework is used in business to set effective goals that are easy to track, but SMART goals aren’t named so simply because they’re a good idea. SMART is an acronym — it stands for Specific, Measurable, Achievable, Relevant and Time-bound, the parameters by which to set your business goals.
Why are SMART goals important?
Setting SMART goals is essential for many reasons, but it all comes down to achieving your business dreams. An organisation implementing SMART goals may see benefits in four key areas:
1. Increased visibility
For a team to succeed, a shared vision is essential. By creating visibility, SMART goals align team members and provide meaning to everyday tasks.
2. Improved decision-making
SMART goals bring order to your to-do list by asking you to prioritise tasks by importance and deadline, simplifying the decision-making process.
3. Faster progression
It’s simple — SMART goal-setting propels you forward by creating a vision. Achievable, time-sensitive goals motivate teams, improving collaboration and reducing time-wasting activities.
4. Better time management
When SMART goals are broken down into tasks, managers have more insight into teams' workflow, allowing for gaps to be filled and more effective time management.
How to set a SMART goal
It’s not what you know about the SMART method — it’s how you use it. Here’s how to write short- and long-term goals using the SMART framework.
Your objective needs to be clear to make sure all relevant team members are aligned. Here are some questions to answer to achieve specificity in your goal setting:
- What do we need to achieve?
- Who is responsible for it?
SMART goals should be measurable and allow you to track your progress easily. Quantifiable targets should answer questions like:
- What does success look like?
- What are the start and end points?
Good SMART goals stay within reach. They should be ambitious within the realm of possibilities. Answer these questions to ensure your goals are achievable:
- How do we accomplish this?
- Does the team have the capacity?
Relevant SMART goals fit in with the business’ bigger picture. A relevant goal answers yes to the following:
- Should this be a priority?
- Is now the right time?
It’s all about deadlines — providing a target date brings focus to your goals. A time-bound goal should answer the following questions:
- When should the goal be completed?
- Is it possible to achieve it by this date?
SMART method of goal-setting examples
In the following scenarios, we break down general goals to meet each metric of the SMART framework.
Goal 1 — Improve customer satisfaction
- Specific — Improve CSAT and NPS scores by 10%.
- Measurable — Build up CSAT score from 25% to 35% and NPS score from +50 to +60.
- Achievable — We have previously increased these scores by 7%, so a 10% improvement seems possible.
- Relevant — Our broader goal is to improve sales, and customer retention will help us do so.
- Time-bound — Improve scores by Q2.
SMART goal: Improve CSAT and NPS scores by 10% each by Q2.
Goal 2 — Launch a mobile app
- Specific — Launch mobile app for fitness class sign-up.
- Measurable — Achieve 2,000 installs within three months of launch.
- Achievable — Dev, design, content and marketing teams have signed off on this project.
- Relevant — Our broader goal is to increase sign-ups, and a mobile app will help us do so.
- Time-bound — Launch the app by December.
SMART goal: Build a fitness class sign-up app and achieve 2,000 installs within three months of the December launch.
Goal 3 — Boost website traffic
- Specific — Increase organic traffic by 10%.
- Measurable — Increase unique site visits by 10% by writing eight monthly blogs.
- Achievable — Finance team has signed off on a freelance budget to outsource blogs.
- Relevant — Our broader goal is to convert visitors into shoppers, and more traffic will help us do so.
- Time-bound — Increase traffic by EOFY.
SMART goal: Write eight new blogs a month and increase organic traffic by 1o% before the EOFY.
SMART business goals vs other goals
Goals are goals — whether they’re SMART or simple, ambitious or everyday, they’re likely to serve you in some form. But not all goals are created equal. Some goal-setting frameworks, such as SMART, outperform others based on factors such as adoption or success rates. Other goal-setting methods may be overly general, making them difficult to action.
SMART goals take the ambiguity out of goal-setting and help you visualise what success looks like. With specificity and measurability, it’s easier to gauge the status of the goal and identify missed targets. Unlike vague goal-setting, SMART goals ask you to divide larger goals into bite-sized tasks that bring you closer to meeting your targets.
How OKRs use the SMART model for goal-setting
Can SMART goals and OKRs coexist? All signs point to yes. But first — what are OKRs?
Like SMART goals, OKRs is a goal-setting methodology abbreviated to a few letters. The ‘O’ stands for Objectives, and the ‘KRs’ stands for Key Results. Both frameworks define the goal, are time-bound and require you to break larger goals into smaller objectives, but OKRs also ask, “how do we get there?”. While SMART goals stand independently as quantitative results, OKRs are a multi-step approach incorporating the SMART framework. First, you set a broad objective, then SMART key results and finally, initiatives. Let’s take a closer look.
- Objectives — Write down a broad outcome you want to achieve this quarter.
- Key results — Define success with 2-3 SMART goals.
- Initiatives — Create tasks that measure the progress of the key results.
For more information on how to set OKRs, see our guides below:
- How to create your first OKRs plan
- How to write good Objectives
- How to write good Key Results
- OKRs templates
But if you’re more of a practical learner, you can sign up for a free trial of Tability, our easy-to-implement OKRs software.