SMART Goals for SMART Business

If you’ve read any of our other blog posts you will know that we talk a lot about setting SMART Goals.
To recap, SMART Goals are a way of creating goals that are well thought out and thus have a greater likelihood of being successful.
The purpose of this post is to cover off each of the terms describing SMART Goals to give you a working of an example of how they come together.

Let’s use the typical business goal of “I want to make more money” – fantastic, we all want money and it seems like a pretty clear goal, but let’s break it down further.

 

Specific – Can we accurately describe what the goal is?

In our example above, “money” is quite vague. Is that Turnover? is it Profit? or is it more Cash?  Any of them could be described as “money” so it’s best to be Specific. For most businesses when they say they want more money they generally want more cash, so let’s update our goal to “I want to make more cash”

 

Measurable – Can we easily measure how we are working towards the goal?

Goals need to be broken down into manageable actions and we need to see if the actions we take have a positive or negative impact on the goal. Checking in on the achievement of a goal needs to be easy, otherwise it becomes too much hard work and gets forgotten about. Fortunately, with CRM, Financial, Job Management systems we use today there are a plethora of reports that can be run to get the information we are often after.

In our example the measurement is cash, probably the easiest measure of all. So no need to adjust our goal this time around.

 

Achievable – It must be focused on a particular outcome

We’ve all set our own personal New Year resolutions only to find ourselves waining towards the end of January. There are a number of reasons for this, but often it’s because during the heady heights of a summer break we set unrealistic expectations and quickly lose hope and drive. By making a goal challenging, but achievable, the drive to succeed is likely to stay for longer and in fact be boosted as you measure yourself towards the goal.

To make a goal achievable set parameters that are comparable to a historical situation. In our example, this would be framed as

“I want to make 12% more cash than last year”

 

Relevant – It needs to be correlated with what you are doing and why

There is no use of setting a goal for the business that can not be solved by working in your business e.g. setting a goal of “losing weight” whilst a great personal goal is not relevant to the day to day actions that happen in a business. In our scenario the financial outcome of “more money” is relevant, as one of the key reasons for being in business is to make money.

Nothing to change on our goal this time around either.

 

Time bound – Set a timeframe for achievement.

By establishing a timeframe around a goal there is an obvious end point at which it needs to be achieved. Human behaviour is that we leave things to the last minute so the more specific the timeframe of your goal, the greater it can be achieved.

Sometimes within a goal, it is good to break the goal down further into these smaller chunks to help you towards the greater goal. We could re-write our goal to achieve this as follows:

“To increase my cash balance by 1% each month to achieve an overall 12% increase in cash by the end of the year”

 

Summary

In summary SMART goals are those more likely to be achieved than those not written with the SMART attributes in mind. Now that you have your SMART Goal established, who’s going to hold you to account for achieving it? Do you need someone external? If so give us a call, we love this stuff!!!

Or perhaps this has sparked your interest in undertaking a larger business planning process. Again we can help.