Defining SMART objectives
SMART is a framework that allows you to ask specific questions of your strategy so that you can see how well it stands up as a concrete proposal. The concept first appeared in wrting in the November 1981 issue of Management Review by George T. Doran. The method is useful in all strategic planning situations and can be well extended to all professional scenarios in which objectives have to be set.
SMART stands for :
These words define the five criteria of a SMART objective. By following the five steps you ground your plan in the reality of time, space, feasibility, personnel and potential impact. You make sure that your objectives are the right goals and improve your strategy’s probability of success.
1. S for Specific
This stage is crucial. The key is to establish the concrete foundations of your plan. You need to define and formulate your objective clearly and in detail. You have greater chance of success when your the parameters of your objective are clearly set rather than with a foggy definition. Furthermore the more clearly your objectives are defined the easier it will be to assess the success or failure of the project.
For example : ‘I want to improve sales performance’ is unclear. ‘I want our sales to improve by 10% by this time next year and our margin to remain stable’ is a much clearer one.
2. M for Measurable
Are we able to quantify the effect of our work:
- Can we say with precision when our target has been reached?
- Can we measure the rate of progress?
- Will we be able to quantitatively assess the level of success of the undertaking?
In order to measure both the final level of success and the rate of change, you have to know where you’re starting from as well as where you want to go.
To continue with our previous example, if we want to improve our sales figures, it’s crucial that we know precisely what they are now, so that we can check the rate of progress.
3. A for Attainable
This is where you ask yourself if your goal is really feasible or if it is wishful thinking.
Based on previous performances, do you think your company will be able to achieve the goal you have set?
Be sure to ask yourself this question if this kind of objective has never been set before or if your expectations are much higher than recent trends.
Most of the time the answer to the question will depend on:
- The time frame in which you have decided to reach this goal (see final step: Time Bound)
- The resources you will be able to access in order to achieve that goal (money, human resources, infrastructure etc)
4. R for Relevant
Relevancy is where you locate your objective within the broader narrative of your firm’s strategy. What does it contribute? How does it fit in? Will it have a positive effect on your company’s over-arching plan?
Example: setting the goal of reducing production costs in all business units might sound like a nice goal but may not be viable if the company’s overall strategy for the year is to double production at all costs.
5. T for Time bound
Setting a time frame is essential to the definition of any objective, otherwise it’s no more than simple wishful thinking.
Without a time target a project can be left to drag on and on. It’s a good idea to think about feasibility and relevancy again when you think about setting a time-frame. What is the strategic rationale behind your timeframe? Does it fit in with your other business projects? Considering all your other projects and priorities, will you be able to reach your goal by that date, or does is have to come second to other projects?
But by setting time by which your project should be finished gives you a yardstick with which to measure your progress.
Here is a shareable presentation that contains all the elements of this post.