Three Steps for Creating Effective SMART Goals for Employees

Every successful organization is adept at setting goals. From overall organizational goals set by the Board of Directors or C-suite leadership, down to individual ones written by managers and their employees, goal setting is critical for the health of the business. Unfortunately, many less successful companies—and managers—set vague and unrealistic goals that frustrate everyone in the organization. Much like New Year’s resolutions, they’re abandoned quickly or worse yet, these goals kill employee motivation and productivity.

The best goals are the ones that don’t leave room for misinterpretation and where everyone knows exactly what they need to do to achieve success. We call these “SMART goals”.

What are SMART performance goals?

SMART performance goals are:

Specific—It includes the who, what, when, where and how
Measurable—A numeric or descriptive measure that defines quantity, quality, cost, etc.
Achievable—A goal that is within the employees’ control and influence
Relevant—A goal that is important to the mission of the department and company
Timely—A target date for completion or frequency of specific action steps that are important for achieving the goal

Broad goals that are too vague often sound good but are worthless in practice. For instance, every salesperson in the world would say one of his or her main goals is to “close more leads” or “sell more [product],” but what does that mean numbers-wise? Technically, improving by one lead or sale has satisfied the goal, but shouldn’t satisfy the salesperson—or his or her sales manager!

SMART performance goals, on the other hand, not only makes the employee consider what the goal is but how to define success, how success will be achieved and how it plays into the organizational goals as well.

So, in contrast, that same salesperson’s SMART goal would be, “Every day I will visit four to six new businesses within ABC County with the objective of signing on 10 more XYZ accounts by Jan. 1, 202X.”  So, as you can see, the expectations for this employee are clear, concise, measurable and have a time table for completion. He or she will know exactly how the progression is heading at any time.

Here are three ways SMART goals can benefit your employees and your business:

1. Create clear lines of communication

With SMART goals, you and your employees will always be on the same page. Whether you do monthly, quarterly, semi-annual or annual performance reviews, there will be no surprises and neither party can claim ignorance of the goal.

2. Make a measurable difference

General goals are subjective, which makes evaluation difficult. Objective goals are very cut and dry so you’ve either achieved them or not. SMART goals are the best of both worlds because you have a formula for setting well-designed goals that have measurables within. That makes tracking the goal easier for everyone involved.

3. Achieve organizational and department goals

The main purpose of setting goals is to allow the employee to improve performance on an individual level. This, in itself, should be motivating to the employee. However, SMART goals make it easier to fit organizational or departmental needs into employee performance so the employee sees the impact of their work in the big picture as well. Seeing how they fit into an organization creates a sense of ownership in the company which has extraordinary value and leads to increased employee engagement.

Be a SMART coach

During the performance review process, you may be tempted to write your employees’ SMART performance goals for them. Don’t.

The manager’s job in the review process is to be a guide, mentor, coach and even a cheerleader. Help them set appropriate goals using the SMART formula. Then, evaluate and ensure they’re reasonable, achievable, and aligned with company objectives.

Employees will be much more motivated to meet a goal that they create versus one they’re given. And the SMART method provides an easy-to-follow formula that everyone can use.

Using a collaborative process involving SMART goals takes virtually all the stress out of it for employees and most of it for managers. (No, seriously ….) And even if your company only has one official performance review time, good managers will set up monthly or quarterly meetings with their staff to catch up on goals and how the employee is doing. The time to catch problems is now—not nine months from now.