What Are SMART Goals and Why Should You Care?

Business goals that are well worded, feel-good platitudes are useless. Properly defined SMART goals that your staff understand and contribute to, will align your organization and drive it towards your mission and vision!

Everyone has been talking about setting SMART goals for years so I am amazed at times when I see corporate goals that are really just a high level objective statement. Business leaders must set SMART goals if they want their organizations to be aligned and motivated towards goal achievement.

I have seen many examples over the years of how powerful SMART goals can be. I have seen:

  1. Businesses reduce costs while improving profit during business downturns
  2. Businesses grow significantly in year over year revenue and profitability
  3. Businesses reduce debt substantially, positioning themselves for future growth
  4. Not-for-profits achieve significant milestones in the causes they serve and the people they impact
  5. Not-for-profits raise significant amounts of funding
  6. Governments eliminate debts and deficits (yes this is really possible!)
  7. Employees’ level of engagement increase
  8. Customer satisfaction scores increase

In all of these instances, the organizations set clear SMART goals and got all the stakeholders aligned and contributing to their achievement.

So, how do you go about setting SMART goals? First of all, it is important to understand that Goals are well-defined targets that are critical to achieving the mission and ultimately the vision of the organization. Goals define WHAT the organization is going to do.

The SMART goal format is defined as:

  • S – Specific: the goal must be defined without ambiguity
  • M – Measureable: the goal must be defined in a way that allows the organization to track completion progress
  • A – Achievable: the goal must be realistically achievable – stretch goals are fine but they must not be impossible
  • R – Relevant: goals must relate to your vision, mission and values
  • T – Time Bound: there must be a completion date assigned to the goal

Take a donut shop, for example. Stating a goal like: “Create and sell the best tasting doughnuts in the city” is not a goal. It might look good on a poster but it is not a goal.

Stating it this way: “Have Baker Bob create a chocolate doughnut by August 1, 2016 that can be made for half the cost of the current doughnuts but outsell all other donuts by a 2:1 margin” is a SMART goal. All of the SMART elements are there:

  • Specific – Baker Bob (goal owner) will create a chocolate donut
  • Measureable – the donut shop can track the cost to produce the donut and they can track the sales of that particular type of donut
  • Achievable – this is a little harder to determine. Is baker Bob capable of creating a blockbuster donut? If so, can he do that by August 1st?
  • Relevant – does this goal tie into the organizations vision? If the donut shop has the vision to be one of the best in the city, this goal is definitely relevant.
  • Time bound – this goal has a deadline of August 1, 2016

Spend some time and review your business goals. If they are not clearly defined SMART goals, re-write them and communicate them to your staff. Be sure to assign responsibility to the people who are participating in the realization of the goal. Create measurements that track the progress against the goal and continuously communicate this back to your staff.

Take these actions and watch what your organization achieves!


We all need lots of powerful long-range goals to help us past the short-term obstacles.” Jim Rohn


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