How to write SMART goals for business success today – with examples

The SMART framework is used by businesses to focus and define their objectives. It is hugely important for strategy-making and project planning, and goes hand-in-hand with setting effective KPIs.

We know what you’re thinking. Shouldn’t every business decision use smart thinking? Why do I need an acronym to tell me how to be clever?

But SMART goals aren’t a reflection of intelligence. They refer to five criteria used to transform nebulous concepts into concrete plans. They ensure every stakeholder agrees on what they are aiming for, keeping the organisation on track and conflict-free.

Below, we’ll explain everything you need to know about setting SMART objectives, including examples for common business scenarios. By the end, you’ll be able to write your own, so you can be confident that your company will achieve its short- and long-term goals in 2024 and beyond.

What are SMART objectives?

Setting a SMART objective (or SMART goal) means keeping all of your ambitions Specific, Measurable, Achievable, Relevant, and Time-bound.

All too often, goal setting is not properly communicated to the people who will actually be actioning the work involved.

SMART objectives are formatted as a clear, one-liner that makes it easy for both managers and employees to understand what the company is working towards, and avoids confusion over who will be responsible for successful delivery.

Organisations can then use the SMART definition to create, track, and accomplish their objectives and key results (OKRs) – essentially establishing an action plan for individuals, teams, and departments to adhere to from ideation, to delivery.

How should you structure a SMART objective?

When writing a SMART objective, the team or individual should first decide on what their overall goal is, before deciding how to make it SMART. Let’s breakdown what that actually means:

• Specific – ensure you are offering a focussed, clear target to aim for. Vague approximations leave room for employees to misinterpret what is expected of them, leading to confusion and inefficient working.
• Measurable – the stated target should include a metric that you will use to track­ progress towards a goal. This can be either quantitative or qualitative, but it cannot be too subjective, or it will be difficult to distinguish between win or lose
• Achievable – any SMART target must take into account the resources you have available to action it. Otherwise, you’ll end up wasting time and energy on an end point that is ultimately impossible to reach – hugely demoralising for employees
• Relevant or Realistic – consider if the target will align with your overall business or team strategy. Oth­er­wise, objec­tives could be suc­cess­ful­ly deliv­ered that have no impact on the over­all per­for­mance of the organ­i­sa­tion
• Time-bound – it is crucial that every aspiration has a deadline that it must be achieved by. This creates urgency, preventing the team from losing interest over time, and also provides a vital milestone for monitoring progress

Why are SMART objectives important?

Simply put, SMART objectives are all about improving efficiency; a particularly important concept for resource-stretched small businesses.

SMART goals set your workforce up for future success. They clarify your ideas and focus the team’s efforts on one target, rather than working to vague instructions like ‘improve the customer experience’. With SMART objectives in place, you’ll know exactly which tasks to prioritise, reducing the risk of wasted time, money, and energy on a fruitless project.

Here are five other benefits that SMART objectives bring to strategic planning:

1. SMART goals help to clarify objectives. Turning a loose idea in your mind into a tangible, written ambition provides focus for project team members, stopping them from getting distracted by a task that will not produce the desired outcome.

2. SMART goals provide a roadmap for success. SMART planning involves explaining not just what you’ll achieve, but how, to create a solid blueprint for actioning your goals.

3. SMART goals help track progress. Time-bound and measurable targets give you a clear milestone to work towards, as well as creating natural checkpoints for monitoring progress.

4. SMART goals help to identify and avoid risks. Project failure is almost always down to poor understanding of what is expected of the team. SMART objectives lay out exactly what is required and what is being worked towards, drastically increasing the chances of success.

5. SMART goals motivate and engage employees. Having an end goal in sight is an easy way to boost morale amongst team members. Similarly, SMART objectives tell each person what they are responsible for, giving everyone a task to own and be proud of.

Examples of SMART objectives

It’s easy enough to understand the concept of a SMART objective. Far harder is putting it into a real-life situation.

Here are three examples of a SMART objective for realistic scenarios that your small business might encounter:

1. A small business wants to write a new mission statement.

SMART objective: Draft and finalise a new mission statement that reflects the company’s values, goals, and purpose within the next three months.

Why is this a SMART objective? 

The objective states a specific goal (create a new mission statement) that is directly relevant to the company’s branding and identity. Its success can be measured by the draft and finalisation, and it sets an achievable deadline.

2. A small retail firm wants to acquire more customers in its contact database

SMART objective: Increase the number of customers in our database by 15% over the next 12 months.

Why is this a SMART objective? 

The objective is specific, and it will be measured using information from the firm’s customer database. 15% is an achievable increase within the set timeframe of one year. Acquiring new customers is also a relevant goal as it will help the business to make more sales.

3. Example 3: a tech firm wants to hire a Chief AI Officer

SMART objective: Recruit and hire a qualified Chief AI Officer with the necessary expertise to lead the company’s AI initiatives within the next six months.

Why is this a SMART objective? 

The objective is easily measurable (success will depend on the recruitment and onboarding of a new team member). Six months is a clear and achievable timeframe, and having an AI officer is a relevant goal for a tech firm.

SMART objectives vs SMARTER objectives

The SMART acronym was first coined in 1981 by US consultant George T. Doran. Since then, like many corporate terms and phrases, it has since evolved as others latched onto the concept and began adding their own ideas – in this case, about what makes a well-defined objective.

As a result, many organisations have now moved onto the idea of SMARTER goal-setting. So what does the extra ‘ER’ stand for?

Here, ER stands for ‘Evaluate’ and ‘Reward’. These two areas essentially turn SMART targets into a more analytical tool for assessing a company’s success or failure in achieving their objectives.

Evaluate = establish some specific checkpoints (incremental or at critical milestones) for managers to offer feedback to their reports. Encourage them to identify future obstacles and brainstorm solutions.

Reward = recognise what the target will accomplish so you can revisit whether or not the outcome met expectations. This discussion also allows you to revisit the objective in order to define new goals that will help improve.

Example of a SMARTER objectives

Let’s take the example we gave earlier of a SMART target (‘Draft and finalise a new mission statement that reflects the company’s values, goals, and purpose within the next three months’).

To make this SMARTER, a company might add in more detail about how it will monitor progress on the target, and what it will bring to the business.

It therefore becomes: “Produce and review bi-monthly drafts of a new mission statement that reflects the company’s values, goals, and purpose within the next three months. The final version will cement our ethos and unique position in the marketplace”.

Are SMART goals the same as KPIs?

KPIs, or key performance indicators, are closely linked to the SMART framework. Both are particularly important for project management, but they serve slightly different purposes when setting goals.

While the SMART criteria enables businesses to articulate their objectives, KPIs are a data-led way to quantify them.

In terms of which comes first, it’s a bit of a chicken-and-egg scenario. KPIs are usually derived from SMART goals, but one can also inform the other to ensure that objectives are being met effectively and efficiently.

The following example illustrates the difference. A small business owner has set a SMART objective for the firm: ‘draft and finalise a new mission statement that reflects the company’s values, goals, and purpose within the next three months’.

They might then introduce three KPIs to measure this throughout the company, utilising the SMART criteria to ensure each indicator is defining what successful delivery looks like:

1. The creative team will measure the number of drafts completed out of the total number planned, targeting 66% by two months
2. The people team will measure the number of stakeholder suggestions incorporated following each draft, out of the total number received, targeting 80% by month three
3. The marketing team will measure the number of customers who are aware of the new mission statement one month after publication, targeting 100%

Who should set SMART objectives?

Who is responsible for setting SMART objectives will depend on an organisation’s size, as well as the specific roles and responsibilities required to achieve the desired outcome.

Here’s a quick rundown of who should set SMART objectives based on the priority level of each goal given:

1. Organisational targets: CEOs and senior management are best-positioned to set high-level SMART objectives for the entire organisation. These could include strategic priorities, financial targets, or market expansion.

As these can require collaboration from multiple departments, they may also require input from cross-functional teams or task forces. Smaller teams with fewer specialists may also choose to bring in external consultants or advisors to assist with niche objectives.

2. Team or department targets: Managers and supervisors may set SMART objectives for their teams, while division heads should set aims for department-wide impact. These should be strategically chosen to ensure they align with, and contribute to, the overall strategy.

3. Personal targets: Managers and supervisors are most likely to set SMART objectives for their direct reports. Employees can set SMART objectives for their own personal and professional development, however, these should require sign-off from managers to ensure they align with team goals.

4. Project targets: Having clear project objectives is essential for effective project management and collaboration. During project planning, it is the responsibility of the project leader to decide on a set of SMART objectives, to be discussed and shared with the wider team.

Risks of not having SMART goals

Ignoring the SMART framework doesn’t necessarily mean that all your business objectives will be non-specific, immeasurable, unachievable, irrelevant, or time-wasting.

But in truth, SMART goals are about more than just helping you set targets. They also do a lot of heavy lifting when it comes to team working and time management.

Here are four of the biggest threats that come from not following the SMART framework when goal-setting:

1. Lack of focus – SMART goals turn your abstract ideas into a clear roadmap for what should be accomplished, as well as how and when. This can then be relayed to the entire workforce to ensure they rally around a common cause.

2. Unrealistic expectations – SMART targets provide clear and specific goals, keeping the organisation locked onto an achievable and realistic target. Without them, you’re more likely to set overly-ambitious targets that are doomed to fail.

3. Wasted time and resources – if you prioritise having an achievable aim that considers the resources available to action it, you will be more likely to develop the optimal master plan. This is a vital advantage when planning a project, in order to avoid going over budget or missing deadlines.

4. Dissatisfaction and demotivation – by creating a sense of achievability, relevance, and time constraints, SMART goals boost team morale and job satisfaction as members see their efforts contributing to meaningful objectives.

Conclusion

The SMART methodology is more than just a rulebook; it’s a secret weapon for stress-testing your game plan.

Together, these criteria ensure organisations can carve out well-defined paths from concept to realisation, preventing schemes from being muddied by vague descriptions and unrealistic aspirations. If your stated objective isn’t Specific, Measurable, Achievable, Relevant, and Time-bound, you’ll fall at the first hurdle.

They might seem like basic requirements, yet the outcome is anything but. SMART objectives foster team confidence, optimise resources, and produce data-backed insights through KPI reporting.

In today’s ever-changing economy, where every step can feel like a leap into the unknown, SMART goal setting provides a well-lit route to informed decision-making for SMEs.