SMART is an acronym that stands for Specific, Measurable, Achievable, Relevant and Time-Bound. Setting SMART Metrics helps to clarify what success means to a business, which will ultimately help it achieve that success. The following explains each part of the tool and how to best utilize it:
Specific – Being specific helps define exactly what the business wants to achieve and sets the path for getting there. For example, being specific helps define what it will take to achieve success, such as “improve the quality of a particular product which will result in increased sales”.
Measurable – Innovation and improvements need to be measurable in order to verify that they are working. Instead of a vague goal of “sell more products”, being specific helps define what that success means, such as “increase sales by 25%.”
Achievable – Achievable objectives should be challenging enough to encourage a team, but not too lofty that it discourages the team and leads ultimately to failure. It’s easy to want to set lofty goals, but if they aren’t feasible, it can set a team up for discouragement and failure. If the metrics are achievable, the team is more likely to remain focused and intent on success.
Relevant – Relevance requires that the metrics fit with the broader business goals of the company.
Time-Bound – If the metrics set in place lack realistic time objectives, the chances of success decrease dramatically. It is important to provide target dates for all deliverables and based on if they can be accomplished within the time frame given.
The final step in creating SMART Performance Metrics is to set a regular review schedule in advance and stick to it. This will allow the group to celebrate successes along the way, as well as course-correct, should that become necessary.