Why are SMART goals important for a strategy?

Achievable goals, highly specific, relevant to a company, and objectively measurable. These are the main characteristics of the so-called SMART goals, indicators that help assess the effectiveness of the strategies implemented by brands and organizations.

What do SMART goals mean?

A company’s performance must be evaluated to determine whether expected results are being achieved. The same applies to organizations and institutions, where it is essential to define the objectives a team should work toward. In this context, the SMART methodology becomes especially important: what exactly does it consist of? What do we mean when we talk about SMART goals?

This methodology takes its name from five concepts, whose initials form the acronym SMART:

• S for ‘specific’: it must be concrete and focused on a clear goal.
• M for ‘measurable’: they must be measurable, with quantifiable metrics or indicators that allow evaluating the effectiveness of actions.
• A for ‘achievable’: the items to be reached must be attainable, something that can objectively be achieved.
• R for ‘relevant’: focus on what is considered important for the business, relevant to the viability of a project, both at launch and for its continuity over time.
• T for ‘timely’: it is essential to set a deadline to achieve the established objectives, as this helps prioritize certain actions over others and facilitates teamwork with clearly defined roles.

The concept of the SMART methodology has been in use for decades, and its effectiveness, when properly applied, is remarkable. One of the earliest references to it was made by George T. Doran in the journal ‘Management Review’, in an article influenced by the thinking of Peter Drucker. He laid the foundations of SMART goals in the 1980s in the article ‘There’s a SMART Way to Write Management’s Goals and Objectives’. Over time, this framework has been improved and today it is a widely used tool in business management teams and leadership, both when creating a marketing plan and in relation to other corporate and brand strategies.

What are SMART goals used for?

Once SMART goals are defined, it is important to highlight why applying this strategy is so attractive at a professional, business, and even personal level. These are the main advantages of using the SMART methodology:

1. Progress professionally/business-wise with greater confidence.
2. Establish actions and initiatives necessary to achieve a specific goal.
3. Evaluate the cost-effort-results ratio when defining realistic objectives.
4. Optimize time management and increase productivity.
5. Improve workflow.
6. Advance in key aspects such as resource allocation and planning within a business.
7. Detect new opportunities and control emerging risks.

SMART goals and other key concepts in business management and entrepreneurship are covered in practical terms in programs such as the Master in Project Management or the Master in Marketing and Commercial Management at EAE Barcelona. The teaching team can advise students interested in these programs to better understand the subjects and how they could boost their professional careers.

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How to create a SMART goal?

The SMART methodology can be applied across all types of businesses, industries, and professional contexts to establish strategies that lead to specific goals. For those who want to go deeper into the concept, here is a short guide on how to create a SMART goal:

• Define the objective clearly, briefly, and concisely: remember that it must be measurable, realistic, and relevant, among other things.
• Establish the actions considered important to reach the goal.
• Determine how the effectiveness of those actions will be measured.
• Set a timeframe in which the plan must be carried out and completed, avoiding unnecessary delays.
• Evaluate the overall effectiveness of the strategy afterward. If expected results were not achieved, analyze how the campaign could be improved.

Examples of SMART goals

The best way to understand how the SMART methodology is used in practice is by looking at real examples of SMART goals set by companies, brands, and professionals:

• Increase website traffic: increase the number of visits to a website by setting a timeframe and considering actions such as social media advertising, improving SEO, and increasing visibility across different channels and media.
• Increase e-commerce sales: as in the previous case, define a timeframe and the initiatives that could improve results. In both cases, it is useful to rely on KPI to measure performance.
• Optimize delivery times in logistics companies: another specific example from the logistics sector. This could involve hiring more staff, adding new transport methods, etc.

There are countless ways to apply the SMART methodology. The key is always to ensure that goals are achievable and realistic, as otherwise they may generate frustration among those working toward them. That is why, just as important as executing the planned actions, is the initial work of defining SMART goals before putting them into practice.