SMART goals: A goal-setting technique

by Ali Jamal Jomeh

Abstract

Setting goals and objectives is an important part of every organization, as they serve as a guide in terms of what they want to achieve, making them deeply inherent in project, program and portfolio management. Not only do goals and objectives contribute to the successful development of a project’s different phases, but also to the guidance of the project team’s operations towards achieving the goals within the scope, time, quality and budget standards. Evidently, an appropriate goal setting technique can help to successfully accomplish the above, which is where SMART goals enter the picture. The purpose of this article is to fully elaborate the idea behind the SMART goals, how to apply the technique and explore the limitations of it.

SMART is an effective goal setting technique in which the acronym stands for: Specific, Measurable, Attainable, Relevant, Time-bound. The difference between normal and SMART goals is that normal goals are simply what you aim to achieve, while SMART goals include finer details in the equation such as resources, deadlines and potential roadblocks along the way. These goals are to be formulated in regard to these five principles, where the idea is that every project goal must adhere to the SMART criteria in order to be effective. Therefore, a key element in the success of a project relies on setting SMART goals, as it is designed to provide structure and guidance throughout a project and can help answer how the project can contribute to the purpose based on relevant success criteria. Thus, the technique enables managers to clearly define and understand the purpose and goals of a project, program, or portfolio. While SMART is rarely mentioned in the British or PMI standards, it is briefly introduced as part of a quality criteria in line with the PRINCE2 method. Although this technique is applicable in many professional contexts, it is typically applied in project management in the planning phase of a project, as the project scope is defined here in accordance with the international standard ISO 21500. Based on above, this article will examine the tool primarily from a project management perspective.

Why SMART is relevant to project managers

First, it is necessary to establish how the terms goals and objectives will be used in this article, as there are different views on how they should be defined. Goals are by some considered as a high level statement in the long-term and objectives as a low level statement in the short-term. Some may find the opposite true, while others treat these terms as synonyms. According to George Doran, who is considered the founder of the term SMART, it is of little significance to differentiate between the two terms from a practical point of view, as the principles in SMART apply to both. Since the point of this article is to elaborate the SMART tool and not to investigate the definition of goals and objectives, these terms will be treated as synonyms and will be used interchangeably throughout the article.

Background on goal-setting theories

In the late 1960’s, Edwin Locke put forward the goal-setting theory of motivation. This theory states that goal setting is essentially linked to task performance, and that specific and challenging goals along with appropriate feedback contribute to higher and better performance. Furthermore, Locke’s research has shown that the more difficult and specific the goal is, the harder people tend to work. In one study, Locke found that, for 90 percent of the time, specific and challenging goals led to higher performance than easy or "do your best" goals. For instance, advising someone to "do your best" is less viable than saying "attempt to get more than 80% correct". Hard goals are more persuading than easy ones, since there is a greater sense of accomplishment involved when there has been put in a bigger effort.

A few years after Locke’s published article, Gary Latham studied the effects of goal setting in the workplace. His results supported Locke’s findings – that there is an inseparable link between goal setting and workplace performance. According to Locke and Latham, there are five goal setting principles that can improve our chances of success: Clarity, Challenge, Commitment, Feedback and Task complexity. Since Locke's first findings, numerous techniques based on goal setting theory have been published including SMART goals which will be covered in the next section.

Process of establishing SMART goals. With inspiration from

SMART goals

Due to the importance of an effective goal setting technique in organisational performance management, the main principles of SMART goals were introduced for the first time in 1981 by George Doran and are in many ways similar to the principles established by Locke and Latham. Since its first introduction, there have been made a couple of adjustments to the acronym SMART. Today, the current state-of-the-art is generally accepted as:

• Specific - target a specific area for improvement
• Measurable - quantify or suggest an indicator of progress
• Attainable - state what results can realistically be achieved, given available resources
• Relevant - determine if the goal is in alignment with your values and long-term objectives
• Time-bound - specify when the result(s) can be achieved

Why and when is it relevant to use this tool?

Setting goals and objectives is critical for every organisation because goals determine the broad vision and direction for any organisation. The best goals will align with the organisation mission, vision and culture and describe the organisation's longer term aspirations before laying out specific actions. Lower level goals and project goals should ideally relate to the corporate level goals. In order for this to happen, leaders and managers need to get the process of setting objectives right, as inadequately formulated objectives can cause confusion or lead individuals, teams or the whole organisation in the wrong direction.

The SMART acronym is a tool designed to help organisations and individuals set goals in an effective and productive manner. Specific and measurable goals define the success of a project or initiative. Achievable and realistic goals engage and motivate individuals. Time-bound goals ensure that all stakeholders agree time scales for the achievement of goals. Using the SMART criteria in goal-setting works best when the goal is to improve an existing system about which much is known. The criteria fit extremely well when some aspect of the company has deviated from normalcy in a negative way, and the task is to return that aspect to normal. Typical examples include increasing revenue, cutting costs or restoring production yield or quality. In each of these cases, using the SMART criteria to set good goals works because ambiguity about the situation is minimal, and the desired outcome is to restore the system to normal operation.. Furthermore, it can be used to measure and to track project phases and results and can be implemented in conjunction with many methodologies such as Work Breakdown Structure, Gantt Chart or the Balanced Scorecard. To summarize, its easy applicability and level of awareness combined with the positive resonance among users are some of the main reasons for the tool's success.

So when should the tool be used in project, programme and portfolio mangagement? In the field of project management, SMART goals generate a sense of direction, structure and focus in the planning phase. In ISO 21500, it is stated: “The purpose of Define scope is to achieve clarity of the project scope, including objectives, deliverables, requirements and boundaries, by defining the end state of the project. The definition of project scope makes clear what the project will contribute to the strategic goals of the organization”. As the definition of the scope is initiated in the planning phase of a project, SMART goals will typically be applied in this stage from a project management perspective. In programme and portfolio management, the scope tends to be more fluid than that of a project, as it is unlikely that solutions for all the projects within the programme/portfolio can be identified at the outset, and at the same time the business environment may change. Normally, a portfolio is distinguished between a standard and structured portfolio. A standard portfolio is an accumulation of projects and programmes with unconnected objectives. Its scope is flexible and is simply the sum of the projects and programmes it contains. In this case, it is inexpedient to use SMART goals as the scope is derived from a bottom-up approach. A structured portfolio is, however, defined by the strategic objectives of its host organisation that it is designed to satisfy. Its scope is the sum of the projects, programmes and change activity required to deliver those strategic objectives. In this context, the use of SMART goals is more apparent as defining the strategic objectives in the portfolio scope forms the basis for the initiated programmes and projects. In short, the appliance of SMART in programme or portfolio management should only be relevant if the scope is defined from a top-down approach. Even then, there may be some drawbacks to using the technique. These will be covered in the section 'Limitations'.

Connection to standards

Even though SMART is well-known and commonly used, it is rarely mentioned in the British or PMI standards that provide guidelines for achieving specific project, program and portfolio management results. However, in the standard "Managing Successful Projects with PRINCE2", SMART is used as part of a quality criteria for a project brief in line with the PRINCE2 method. Here, it is stated that the project objectives and project approaches in the quality criteria should be consistent with the organization's directive, and that project objectives should be specific, measurable, achievable, relevant and time-bound.

Framework for SMART goals

In the following subsections, each criterion in the SMART model will be elaborated further.

Specific

The first criterion is that the goal should target a specific area of improvement or answer a specific need. Because it is the first step in the process, it is pivotal to be as clear as possible so that everyone who reads it interprets it the same way. This can be accomplished by, for example, using the 5 W's:

• What do we want to accomplish?
• Who is involved?
• Which resources are involved?
• Where is it located?
• Why is it important?

Measurable

The goal must be quantifiable, or at least allow for measurable progress. By the definition of the word itself, this step should help answer questions such as:

• How do we know if we are progressing?
• How will we know when it is accomplished?
• How much or how many?

When checking for this step, assessable terms should be used such as costs, deadlines, frequency, quality, quantity and so forth.

Attainable

The goal should be realistic based on available resources and existing constraints. Typical project constraints include team bandwidth, budgets and timelines. Project managers should look to data from similar projects done in the past for insight on what is actually achievable. Based on this, it is imperative to ask questions such as:

• Can this goal be achieved and in which way(s)?
• How realistic is the goal based on the known constraints?
• Is the team equipped with the necessary skills and knowledge to meet the expectations?

Relevant

SMART goals for project managers should be relevant to the company mission and reflect one or more core values. In order to make sure the project delivers the required results, it is important to track that each goal stays consistent with the objectives of the company on the whole. The below questions can help answer this:

• Is this goal aligned with the company's values and long-term aspirations?
• Does this goal match the other needs?
• Does this goal seem worthwhile?
• Is this the right time to set it?
• Is it applicable in the current environment?

Time-bound

The last thing to consider in establishing SMART goals for project managers is for the goal to be time-bound. Time-bound goals involve a realistic time frame to be achieved. In order to avoid a never-ending marathon in a project, each stage must have a definite deadline. Not setting deadlines will reduce levels of urgency and motivation and may result in unnecessary delays or failure to reach the goals. By keeping tasks and goals time-bound, the team will feel a sense of urgency to work and deliver results in the desired time period. Questions like these can help develop a time frame for each milestone:

• When is it relevant?
• When is the deadline?

Application of SMART goals: A practical example

As mentioned, SMART goals are typically implemented in the planning phase of a project. However, because of its great scope of application possibilities, it can be utilized throughout the entire project management process. In this specific case, it is used in the planning phase of the project, where the purpose is to implement a supplier scorecard tool for a large company that sells electronic products of high quality.

Specific

The target area for the goal is specified through the following questions:

Question	Answer
What do we want to accomplish?	Implement a supplier scorecard
Who is involved?	The departments for Sourcing, Procurement and R&D as well as the affiliated suppliers.
Which resources are involved?	Departments for finance and quality
Where is it located?	As part of a contract and vendor management system
Why is it important?	To be able to measure, monitor and manage supplier performance

Measurable

Here, the success factors for the project are established.

Question	Answer
How do we know if we are progressing?	By tracking how many of the 48 suppliers have provided the information needed to establish the scorecard criteria.
How will we know when it is accomplished?	When the scorecard has finally been tested and evaluated to the project owners' satisfication. The average cost of components should be down at least 5%, and the average lead time should be reduced with at least 10% the following year on the condition that the implementation is successful.
How many will this affect?	All of our 48 suppliers including the following departments in the company: R&D, Sourcing and Procurement

Attainable

Now, it is time to assess whether or not these results can actually be achieved.

Question	Answer
Can this goal be achieved and in which way(s)?	Yes, by acquiring data input from departments internally and from suppliers to establish the relevant KPI's. Finally, the system itself must be integrated with the existing systems, which is currently feasible.
Is the team equipped with the necessary skills and knowledge to meet the expectations?	Yes, as some of the team members have experience with implementing a scorecard system. The rest have access to the relevant data needed for the system.
How realistic is the goal based on the known constraints?	Relatively realistic, as the team members have the skills and knowledge to perform the tasks within the constraints.

Relevant

It should be determined if the goal is in alignment with the company's overall strategic objectives.

Question	Answer
Is this goal aligned with the company's values and long-term aspirations?	The company focuses on selling high-quality products. The scorecard metric encourages that, as it will help sourcing managers select well-performing suppliers.
Does this goal seem worthwhile?	Yes, because it adresses the problem of sourcing managers having a hard time identifying the well-performing suppliers based on service, quality and cost.
Is it applicable in the current environment?	Yes, as the contract and vendor management system is set up to have a scorecard implemented.

Time-bound

Finally, the deadlines for the milestones are indicated here.

Question	Answer
When is it relevant?	Right now. The sooner the system is implemented, the better.
When are the deadlines?	The project should not exceed 12 months. Phase 1 of initiation: Within 2 months. Phase 2 of implementation: Within 8 months. Phase 3 of evaluation: Within 12 months.

Limitations

In this section, the limitations of SMART goals will be identified. Some limitations exist due to human failure which applies to many methods in project management, while other limitations can be developed due to the method's natural characteristics. The identified limitations in this section are primarily focused on the latter.

1. The detailed process can sometimes be time-consuming and have the opposite effect. Some may feel that they need to have a detailed description for each step and can get stuck trying to provide the “correct” answer. SMART might actually become an obstacle to making progress if people see the goal-setting process as heavy and time-consuming. If the purpose of goal-setting is to make people more motivated and committed to the process of goal achievement, then being asked to provide a detailed SMART analysis could, in fact, be counter productive.
2. The method does not take conflicting goals into account. While goals can sometimes be mutually reinforcing, they can also be in direct conflict with one another. The SMART method is often criticised for not taking into account conflicting goals such as organisational, environmental and ethical perspectives due to its discrete framework. For example, if the performance of a customer service agent is measured in terms of number of customers served, the agent may deliberately shorten conversations at the expense of customer satisfaction in order to meet the prescribed target. In SMART goals, there is no accounting of the cause-and-effect relationship between the goal and its wider impact like in, for example, the Balanced Scorecard. Highly specific goals may create a sense of tunnel vision and cause teams to focus on one area of a business while neglecting other aspects. Therefore, organizational objectives tied to a reward system can affect a company's culture, create workplace conflicts and promote unethical behavior. In addition to this, SMART does not have any evaluation step (for example, when a goal is no longer desirable or circumstances shift). For these reasons, some have suggested the model should be changed to SMARTER (E – Evaluate / R – Review).
3. It encourages a simplistic and short-sighted approach to management. When complexity is high, an organization will rarely know whether achievement of a goal is realistic; it is often not possible to know whether a goal is achievable without learning more about the problem. It is likewise impossible, when dealing with complex problems, to know when a goal can be achieved because so much is unknown; only simple problems can be solved predictably enough to put their solution on a schedule. But most ambitious goals worth pursuing are not governed by simple cause-and-effect relationships; they require experimentation and analysis to uncover possible causes and alternative solutions before anyone can determine when the goal might be achieved. The point is that the SMART method may be useful in simple projects, but can be redundant and short-sighted when dealing with programmes or portfolios of high complexity.
4. It is not suitable to use when dealing with breakthrough innovations. So far, it has been clarified how effective the SMART method can be in setting goals when it comes to the improvement of a system. However, some argue that a fundamental change in a system cannot be obtained by using SMART goals, since these may result in innovations of only the most incremental kind, and not the kind that can be classified as breakthroughs. The argument is that the SMART method works against the dimensions of freedom, risk-taking and out-of-box ideas. Sharply defined goals may restrict our thinking and work. The need to meet near-term metrics drives easily-reached goals with short-term payoff and works against innovation, which has longer-range focus. Out-of-box ideas are eliminated at once if goals must be achievable. For these reasons, SMART should not be used in projects where the goal is to create breakthrough innovations.

Alternatives

There are a number of goal-setting techniques that have some of the same characteristics as SMART goals. Some of these techniques may even work better than SMART goals in a specific environment or supplement the tool depending on the prerequisites. Some of these alternatives are:

1. Locke and Latham’s 5 principles
2. OKRs
3. FAST
4. SMARTER
5. The Golden Circle

Note, that Locke and Latham's 5 principles have been briefly covered earlier in the article. In this section, a quick review of FAST and SMARTER will be carried out.

FAST

FAST is a framework created to help managers setting and managing goals. It attempts to summarize how goals as a whole should be approached and utilized, modernizing goal setting through the inclusion of more agile practices and a focus on the surrounding environment. Despite their apparent similarities of the two methodologies, FAST goals separate themselves rather drastically from SMART. While SMART serves as a checklist of things to keep in mind when creating goals, FAST focuses both on goal setting and on creating a better surrounding environment for goals. In terms of goal setting, FAST reprioritizes what is important, but do not stray far from SMART. The real difference between the two methodologies comes from the more agile approach of FAST goals and the splitting of the focus from goal setting to both goal setting and goal utilization. The argument against SMART is that it undervalues ambition, focuses narrowly on individual performance and ignore the importance of discussing goals. To drive strategy execution, leaders should instead set goals that are FAST — frequently discussed, ambitious, specific, and transparent.

SMARTER

In the article "Will the real SMART goals please stand up?", Professor Robert S. Nubin states that the definition of the SMART acronym may need updating to reflect the importance of efficacy and feedback. Due to identified limitations in SMART goals, an extension to SMARTER goals has been developed. The main difference is that SMARTER moves beyond goal characteristics and into goal interaction by incorporating some of the same elements in FAST goals. Several variations of the acronym exist where some authors define the new criteria as:

• E (Evaluate): This criterion demands a manager to evaluate the progress of the goals. As projects are exposed to a dynamic business environment, a continuous evaluation of performance is necessary to adjust the goal settings.
• R (Review): The final aspect of SMARTER goal setting is that goals should be reviewed, and can be revised based on the outcome of the evaluation. Revision happens during evaluation, so these two stages go hand-in-hand.

These criteria can help mitigate some of the potential flaws of the original tool.

Annotated bibliography

This article includes a variety of literature including books, scientific papers, articles and online blogs. Articles and online blogs have been included in order to capture information that expands on the ideas of the tool. The literature has been carefully selected by asssessing the sources used, and by checking whether these are consistent with the original descriptions of the tool. Note, that only the key references related to tool will be reviewed in the annotated bibliography.

Doran, G. (1981). There's a S.M.A.R.T. way to write Management's goals and objectives.

• This paper by George Doran provides the first academic mention and elaboration of the acronym SMART by articulating a cogent way to define, measure and ultimately achieve goals. It is important to emphasize the academic value of the paper, as it explains the correlation between vague goal setting and underperforming organisations. In addition, it expands upon the definitions of goals and objectives, and in which context they are to be distinguished. Finally, the paper touches upon the obstacles and complexity of a dynamic business environment in relation to goal setting.

Yemm, G. (2013). 'Essential Guide to Leading Your Team: How to Set Goals, Measure Performance and Reward Talent.

• This book aims help readers learn how to use a number of specific tools and techniques to produce more effective performance and outcomes. For this article, the important aspect of this book is the definition of SMART and SMARTER which the author clarifies, and also explains the need for the methods.

How to Make Your Goals SMART.

• This article provides a great insight into the SMART method and has mainly been used in the framework for SMART. It explains the definition of SMART, the step-wise process of how to use the tool and the advantages and disadvantages of it. The content is based on references of high standard and expands upon the ideas presented in these first-hand sources.

Winter, T. (2015). Praise & Criticism: SMART Goal-Setting Model.

• This article elucidates the various strengths and weaknesses of the SMART tool. It is a great asset because it also examplifies some of the ideas introduced in the article. Moreover, it references a number of authors throughout the article which reinforces the credibility of the arguments presented.

Prather, C. (2005). THE DUMB THING ABOUT SMART GOALS FOR INNOVATION.

• This article aims to elucidate the drawbacks of using SMART in connection with goals related to innovation. It also clarifies in which context it makes sense to use SMART goals, and also offers an alternative set of criteria for breakthrough goals in innovation.

Locke, E. et al. (1980). Goal setting and task performance: 1969-1980.

• This scientific paper is not directly associated with SMART, but provides an insight into the research of goal-setting which is the foundation that SMART builds upon. It is a review of both laboratory and field studies on the effect of setting goals and is one of the most robust and replicable findings in the psychological literature. For the background on the psychological aspect of the theory, refer to Locke's research paper "Toward a theory of task motivation and incentives" which examines the relationship between conscious goals and task performance.