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Modern Spend Management and Accounts Payable software.

Helping organizations spend smarter and more efficiently by automating purchasing and invoice processing.

We saved more than $1 million on our spend in the first year and just recently identified an opportunity to save about $10,000 every month on recurring expenses with Planergy.

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Cristian Maradiaga

King Ocean

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  • Where the best opportunities for savings are in indirect spend.
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How to Set SMART Goals In Business: What They Are, Examples, and How To Use Them

How to Set SMART Goals In Business_ What They Are, Examples, and How To Use Them

KEY TAKEAWAYS

  • SMART goal setting is crucial for small businesses and entrepreneurs who want to grow.
  • SMART goals guide you through exactly what you want to accomplish and when.
  • SMART goals improve your overall business – with clearer pictures of what needs to be done and how.

The SMART goal framework has been used since the early 1980s to guide the development of measurable goals. Smart stands for Specific, Measurable, Achievable, Relevant/Realistic, and Time-bound. Each letter can stand for many variations, but these are the most commonly used.

This acronym is a great way to ensure that your organization’s goals are well thought out and will lead to successful results.

What Are SMART Goals

SMART goals are specific, measurable, achievable/attainable, relevant/realistic, and time-bound. They are often used in businesses as a way to measure progress and success.

But why? Well, these types of goals tend to be more successful than those that are not specific or measurable. And, who doesn’t want their business to be successful?

Breaking Down The Components

Let’s break down each component so that you have a better understanding of what goes into a SMART goal.

  • Specific

    A specific goal is clear and easy to understand. This goal should identify what needs to be accomplished and when. For example, “Increase our market share by 5% by the end of Q3 2020” is a specific goal.

    On the other hand, “Improve our marketing efforts” is not a specific goal. It lacks the details necessary to understand what needs to be done and when it needs to be completed.

  • Measurable

    A measurable goal is one where you can track progress and determine whether or not it has been achieved. For example, “Generate 100 new leads per week” is a measurable goal because you can track how many leads are generated every week and determine whether or not the goal has been met.

    On the other hand, “Increase social media presence” is not a measurable goal because it is difficult to track progress and determine whether or not the goal has been achieved.

  • Attainable

    An achievable or attainable goal can be realistically accomplished given the resources available.

    For example, “Achieve $10 million in annual revenue” is an achievable goal if your company currently generates $8 million in annual revenue.

    However, it would not be an achievable goal if your company only generates $1 million in annual revenue because dramatically increasing your revenue to that level would require too much growth in such a short time frame.

  • Relevant

    A realistic or relevant goal aligns with your company’s mission, values, and long-term goals. It should also be something that can be accomplished given the resources available.

    For example, “Launch a new product line by Q3 2020” is realistic and relevant if your company operates in the Consumer Packaged Goods industry and you have the resources necessary to develop and launch a new product line.

    However, it would not be realistic or relevant if your company operates in the Services industry because launching a new product line would require a completely different set of skills and resources.

  • Time-Bound

    A time-bound goal has a deadline associated with it. For example, “Reduce customer churn by 2% by December 31, 2022” is time-bound because it specifies when the goal should be accomplished. Goals that are not time-bound tend to lack urgency, leading to procrastination.

    Some companies are moving to another model of SMARTER goals, which adds: Evaluate and Re-Do to the equation. This optional step isn’t necessary for every goal but can be helpful for some industries.

  • Evaluate

    As you move toward your goal completion, you may find that you have to evaluate things. Circumstances change, especially with economic uncertainty and other external factors at play.

    If in the middle of a project, one of your top employees gets sick and has to go out on leave for six weeks, you’ll have to evaluate things to determine what to change and how to make it work.

  • Re-Do

    It’s also possible that as you evaluate things, a goal you set a month ago may not be as relevant as it was when you set it. That means going back to adjust it so that it continues to make sense for your organization.

Why Use SMART Goals?

Business owners who use SMART goals can accomplish more because they have something specific and measurable. This leads to increased productivity and results.

Measurable goals make it easier to track progress and keep your team motivated. As you progress, you can evaluate and make changes where necessary to keep your projects on track.

When you hit targets, that dopamine rush keeps you moving toward the next milestone.

You can use smart goals to complete projects and improve individual or team performance.

How to Write a SMART Goal

First, identify what you want to achieve. Once you know what that is, you can start setting your sights on making it happen by writing a SMART goal statement when you work on goal setting.

With smart business goals you:

  • Specify what you want to accomplish
  • Measure progress along the way
  • Make sure the goal is achievable and realistic
  • Tailor the goal to your company’s needs and culture
  • Set a deadline for completion to create a sense of urgency

Here’s an example of a non-SMART goal: “I want to increase sales.”

And here’s an example of the same goal written as SMART goal: “I want to increase sales by 10% in the next quarter.”

The second goal is much more specific than the first one. It’s also:

  • Measurable (you’ll be able to track whether or not you’ve increased sales by 10%),
  • Attainable (increasing sales by 10% is realistic),
  • Relevant (increasing sales aligns with your company’s objective of making money),
  • Time-bound (you’ve given yourself a deadline of one quarter)

Once you’ve written your SMART goal statement, create an action plan for achieving it.

This plan should include specific tasks that need to be completed and deadlines for completing them. Think of it as a roadmap to guide your initiatives.

By breaking your goal down into smaller pieces, you’ll make it much easier to achieve it—and you’ll be able to track your progress along the way.

Don’t forget to celebrate once you’ve achieved your goal! Achieving any sort of significant business milestone is cause for celebration—so make sure to give yourself (and your team) a pat on the back once you’ve hit your target.

SMART goals add clarity that make it easier to plan and act.

Ways Your Business Can Use Smart Goals

You can use smart goals in every facet of your business plan. Here are some examples of SMART goals in everyday business settings.

  • Social Media Marketing Campaigns

    Let’s say you want to grow your LinkedIn following by 1,000 followers by the end of the year.

    You’ll use metrics like page views, click-throughs, and engagement rates to tell you if your content and messaging are working.

    You can even set social media goals for each network. These goals should be determined by your entire organization and should be consistent with the SMART framework.

    You can enlist your marketing team’s help to devise a plan to accomplish this goal.

    Ideas include:

    • Running LinkedIn ads that ask people to follow your page
    • Including your Facebook Page updates on your website with an embeddable widget
    • Adding social media buttons to your website and email signature
    • Planning content and posting on a consistent schedule.

    The sales team can take over the new leads and increase your company’s revenue, which can help you reach other goals.

  • Search Engine Optimization

    We want to increase the number of website visitors from organic search results by 100% over the next 12 months.

    In the current competitive market, it’s not enough to attract traffic to your site. You must analyze your sales funnel and conversion rate to see which parts of the website are more effective.

    You should also identify where leads are dropping off and measure conversion rates across different channels.

    SEO is an ever-changing discipline, and no one answer works for every site. Some site owners focus on the technical aspects of SEO to earn a good ranking on Google, while others focus on generating more business through the site.

    The plan of action here may look like this:

    • Analyzing the most important keywords for the company and seeing where those pages currently rank.
    • Adjusting on-page content to boost rankings on pages that need a little help.
    • Starting a link-building campaign to boost traffic on the pages that aren’t performing as well as others.
    • Conducting more keyword research to find low-hanging fruit – the relevant keywords that aren’t difficult to rank for.
  • Generate New Customer Leads

    Every business could benefit from more customers, right? A SMART goal here may look something like this:

    In the next 30 days, we want to increase our qualified leads by 10%.

    Notice here how we specified qualified leads. It makes the goal even more specific. It’s easy to bring in generalized leads – but those are less likely to convert to paying customers.

    By focusing your efforts on qualified leads, you automatically increase your chance of a conversion.

    Your action plan could include:

    • Offering a special discount for people who book a demo/purchase a product within 24 hours of subscribing to your email list
    • Offer a lead magnet to grow your email list
    • Run social media ads to attract new customers
    • Start an affiliate or customer referral program
    • Look to other businesses to partner with to share customers
  • Bring New Team Members on Board

    Whether hiring your first employees or wanting to expand your team, having the right people in your company can make all the difference.

    Setting SMART recruitment goals can attract the top talent you need to bring your business to the next level.

    We want to add three new employees to our marketing team within six months.

    Your plan of action could look like this:

    • Meeting with your current employees to determine where they could use the most help. Do they need a copywriter on staff to help with creative copy? Do they need a graphics designer on hand to design marketing materials?
    • Writing comprehensive job descriptions for each position you’re looking to fill.
    • Sharing the job listing on various career websites like Indeed and Career Builder.
    • Hiring a recruiter to handle finding people that fit the positions for you
    • Conducting interviews with prospective candidates – including asking for samples of work.
    • Putting together your offer packages for the chosen candidates
  • Cut Procurement Costs

    Businesses need to spend money to make money, but spending frivolously could spell disaster. Cutting costs isn’t always about saving money but stretching the budget and making smarter decisions.

    We want to decrease our procurement expenses across the entire company by 10% over the next 12 months.

    You can take this goal and break it down into smaller goals for each department, paying special attention to the areas where most of the spending comes from.

    Your action plan may look like this:

    • Evaluate all current spending to pinpoint the most expensive items.
    • Speak with your most valuable suppliers to negotiate better deals on those items
    • Conduct supplier performance evaluations to ensure all the suppliers are maintaining their contractual obligations
    • Start looking for alternative suppliers who can provide better pricing
    • Leverage volume or early payment discounts

Start Setting Smart Goals Today

Setting SMART goals for your business is essential for measuring progress and determining whether or not you are achieving success.

These goals are specific, measurable, achievable/attainable, relevant/realistic, and time-bound. Remember this acronym next time you sit down to set some business goals.

What’s your goal today?

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