5 SMART Goal-Setting Principles

When you’re setting your business unit or department goals, take the time to think through every goal to make sure they’re SMART.

When you go to set your business unit goals, there are a few principles you should follow. Any goals you set should be smart. Specific, measurable, achievable, relevant, and time-bound, these principles improve the team’s understanding of what they need to deliver. They’ll help you ensure you’re able to track performance against the achievement of the goal and gain the team’s commitment to achieving it. There are multiple versions of smart, but they all get to the same thing, creating clear and actionable goals that matter.

Specific

Specific gets to spelling out the behavior or outcome that you desire, it lets people know what to focus on and what actions are expected.

Measurable

As far as being measurable, if you can’t measure it, you don’t know if you succeeded. It also ensures you’re driving the right outcome. Like profits versus sales, because you’ll get very different behaviors depending on how you measure.

Achievable

The goal should be achievable. If it’s not realistic, people are going to give up and not even try. They’ll get halfway through the year and say, “We’re off course so you know what, forget it.”

Relevant

The goal needs to be relevant. It drives the activity that’s tied to a broader organizational goal. If I set a cost-cutting goal for the company but we’re trying to grow sales, that cost-cutting goal is going to be not relevant or helpful to achieving the broader goal of hitting sales.

Time-bound

Your goal should also be time-bound. People need a sense of urgency. Specifying time also enables better work and better project planning.

I worked in an organization where we were trying to increase the number of dollars that we were getting back from consumers who owed us money. The goal was specific. We said, “Here is the metric that matters. We need to achieve 100 million dollars of incremental dollars collected.” It was measurable. We knew exactly what data to get and how we would track it. The 100 million dollars was achievable. Sure it was a big number, but we looked at last year and we said we think we can hit 100 million this year. That goal was absolutely relevant. One of the bigger goals for the company was driving down our losses. It was really dependent upon bringing in these incremental dollars collected. And it was time-bound. We said, “By December 31st, we need to collect these incremental 100 million dollars.” By setting that smart goal, everyone in the organization knew exactly where we were going and why it mattered.

When you’re setting your business unit or department goals, take that time to think through every goal and make sure that those goals are smart.

Want to learn more about setting business unit goals? How about taking an entire course on it? Go directly to the course and start learning how to set business unit goals. The entire course is available at LinkedIn Learning. Enjoy!

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