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Chances are, if you are an aspiring entrepreneur, you’ll have heard of the term “SMART goals.” Despite its inclusion in the hall of fame of buzzwords, SMART goals are an objective-setting system that should be taken seriously. Done right, they can motivate and inspire you and your staff to successfully grow your business.
A clearly defined pathway to the achievement of your startup’s goals, the incorporation of SMART strategies into your company’s operations has become synonymous with improved objective management and completion.
The acronym typically stands for:
SMART goals help both you and your employees understand what success looks like (both individually and the organization). When only half of worldwide employees report being aware of exactly what is expected of them in their role, having definable goals is essential for performance and the growth of your startup.
But what is a SMART goal in practice, and how can you use SMART goals effectively to ensure optimal performance for your startup?
Below, we’ll cover four SMART goal examples that will help you to set the right targets for your business.
SMART Goal Example #1: This November, increase client retention by X percent compared to last November
Client retention is an important metric for many companies, and one that needs to be regularly measured and revisited to see what can be done to improve services and procedures.
- Specific: This goal is about client retention and will focus on only client retention; no other issues or factors will come into the equation.
- Measurable: This goal will be measured year-over-year. For example, if last November, you had 80 percent client retention as an employee, you might be expected to increase this by 5 percent, meaning client retention should be at 85 percent by the end of November.
- Attainable: This goal should be attainable and realistic for the employee. If their client retention was 40 percent, you can’t expect them to improve their retention rate to 80 percent. If, on the other hand, your retention rate was 90 percent, you can’t expect an increase of 10 percent.
- Relevant: Client retention is important to a business, enabling them to survive and compete in a difficult market.
- Time-Bound: This goal is set to be measured in November. Using this information, an employee can track their progress over time.
Related: SMART Goal Setting for Your Business
SMART Goal Example #2: Establish monthly employee feedback reviews to replace annual ones
This is a SMART goal for managers. The idea is to transition away from annual performance reviews (companies that implement regular performance conversations are proven to have lower turnover rates and higher levels of engagement than those that adhere to an old-fashioned yearly appraisal).
- Specific: This goal is specifically concerned with one-on-one catchups between manager and employee. While there will likely be training on what to discuss and how to conduct these reviews, this goal is simply about ensuring they take place once a month.
- Measurable: The fact that this goal specifies a monthly meeting makes it highly measurable and trackable.
- Attainable: There’s a belief among many that regular monthly catchups with employees are too time-consuming. As such, they don’t believe it’s a sensible option for their business. However, when considering the management hours spent on annual appraisals (which have shown to be ineffective, anyway) and the time spent filling out forms before carrying out long and formal meetings, you will begin to see how monthly informal (yet informative) catchups are not only attainable, but will also save your company time in the long run.
- Relevant: This SMART goal is relevant for managers of almost any organization, as monthly catchups keep everyone updated on pressing concerns, areas for improvement and recent successes. Ultimately, this will serve to improve productivity and the bottom line.
- Time-Bound: This goal has allowed time for the manager to set up meetings and prepare their employees for the change in their performance management system. This tells the manager that the transition needs to be put in place soon, rather than being something that can wait until next quarter.
SMART Goal Example #3: This quarter, develop a website platform to increase weekly lead generation to 100 per week
Whether you offer a product or service, we all share a common goal: we want to make more sales. Overhauling a website and tackling glaring Search Engine Optimization (SEO) and user experience issues could seriously revolutionize your lead generation results.
- Specific: This goal is specifically about creating a better website to increase lead generation. It is also specific as to how many leads are desired as a result.
- Measurable: A very clear number (100) is given in this goal. Let’s say the website is currently generating 80 leads per week — now you know you need to take steps to increase this by 20.
- Attainable: Given the right approach, this goal is entirely attainable. Of course, the goal in question needs to be considered in context — what is the industry? How niche is the service or product? Depending on the industry, this goal is entirely attainable, but, of course, it should be adjusted to be realistic if not.
- Relevant: Increased lead generation results in increased business revenue, boosting long-term revenue over short-term investment.
- Time-Bound: A three-month target has been given for this goal.
SMART Goal Example #4: Decrease voluntary employee turnover rate by X percent this year
Employee retention is a concern for those startups with employees, particularly when you take into account the record-low levels of unemployment and the current war for talent.
- Specific: This goal is specifically about voluntary turnover within a business.
- Measurable: This goal will be measured in the reduction of voluntary turnover by a specific percentage. For example, a business could aim to reduce their voluntary turnover from 15 percent to 10 percent.
- Attainable: This goal can be entirely attainable, given the right figure. Several steps can be put in place to retain quality employees. As a first measure, companies can proactively survey employees to determine the largest attrition factors and see how the employee experience can be improved. The performance management process can also be improved and companies can offer flexibility and other sought-after perks.
- Relevant: This goal is relevant because by reducing turnover rates, the business can retain talent and reduce expenditure on hiring.
- Time-Bound: This target is long term and will be evaluated in a years’ time. This gives managers enough time to put measures in place and determine what retention methods are most effective.
For more on SMART goal setting, read this article to continue learning how to set effective goals for your business.