What makes formulating SMART goals so difficult?
A study shows that over 75% of companies still formulate objectives in far too woolly language. No one really understands any of it. You can change that, of course, you can start formulating SMART objectives. Then it will be easier for your organization to reach its goals.
Figure 1: The SMART meaning and abbreviation shown: Specific, Measurable, Acceptable, Realistic and Time-bound. Get inspired here with 100+ SMART goals examples.
To explain the SMART method, we’ll take the topic of innovation as a SMART example. For each letter in this abbreviation, we provide explanations so you can answer the question “What is SMART?”. The five letters in the word actually themselves provide the explanation for why formulating SMART goals is not easy:
This explanation might already help but if you still need extra hands in order to implement SMART goals in your organization, contact us or order our SMART toolkit.
What are the 5 biggest KPI pitfalls?
SMART Goals form
If you look at it this way, the SMART principle is pretty simple. But how do you go about putting this into practice? And what is involved? In our KPI toolkit we explain this in detail for you. You get a lot of tools and practical tips for implementation of SMART goals, setting up KPI’s, standardizing and making SMART agreements.
Figure 2: SMART formulation with a handy form. Click on the image to download this form for free.
Work in small steps towards your SMART goal
If your goals are SMART you have already taken a big step in the right direction. But do you know how you are going to achieve your SMART goal? For that you need a clear strategy. You also need to map out the road to the goal. So, that everyone understands what to do in which situation and can also explain it to others.
So, even SMART goals need a strategy. Because on the way to the goal you are bound to encounter obstacles. It’s better to think about this in advance than to face surprises. In line with the agile organization.
The SMART principle is a kind of spelling checker
You should really only think of the SMART method as a kind of spelling checker that merely identifies spelling and stylistic errors in a text, but does not say much about the content of the text. If we follow this analogy, then the SMART principle says nothing about whether a particular goal is a good idea. In other words, an objective may well be SMART, but at the same time be an unsound idea.
Even worse, the SMART formula encourages low goal setting. No one is willing to set goals that seem unachievable or unrealistic. The so-called weak brethren will focus mainly on the capital letters A and R in the acronym as justification for choosing the path of least resistance. This while it is known that tough, demanding and strenuous tasks and goals ultimately lead to the greatest commitment and highest performance.
Excel at something: a SMART example
When setting SMART goals, it’s best to focus on things that really matter. Something you really want to achieve and excel at. The following example is about the Dutch Fire Department translating its mission using the SMART method.
- Excel: A smart manager first identifies what the organization wants to excel in. The goals then start to make sense and take on the SMART meaning. This gives your people purpose and passion for the business. They understand not only the SMART abbreviation but also the deeper meaning of the goal.
- Move: establish what movement you can make toward the ultimate goal. In doing so, you also reveal what your personal ambition is and what the ambitions of the organization are.
Figure 3: SMART goals example at the Fire Department. Translate the mission into SMART goals.
- Measuring: then you make the progress measurable towards that goal with KPIs. You monitor the progress together on a continuous basis as laid down in Dr. Deming’s improvement cycle Plan-Do-Check-Act.
- Norming: in this step you determine exactly which target values (norms) must be set for the KPI’s. You adjust these norms where necessary. For example, absenteeism may not exceed 4%.
- Achieve: which actions do you take together to achieve the SMART goal?
When formulating straightforward SMART goals you should always connect to the higher goal of a project or organization. Like with the Dutch Fire Department. Then you’ll never go wrong.
Five basic principles of SMART goal setting
In 2002, two well-known American scientists, Edwin A. Locke and Gary P. Latham, published a high-profile article on goal setting in American Psychologist. In the famous article, the two professors summarized their findings based on 35 years of scientific research. They came up with five basic principles:
- Setting specific, hard-to-achieve goals leads to consistently higher performance than merely asking your people to do their best anyway.
- High goals lead to more effort on the part of employees than low goals. The highest goals and the very hard-to-achieve goals entice people to exert maximum effort and ultimately lead to top performance.
- Tight deadlines lead to a higher work rate than flexible loose deadlines.
- Publicly announcing your commitment to certain goals increases personal effort to achieve goal realization.
- It doesn’t make much difference to goal achievement whether the goals were originally established by mutual agreement between employee and supervisor, or by an order from above given by the boss.
View 100+ SMART goals examples by industry
SMART goals are made measurable by developing the right insights and key performance indicators (KPIs). The SMART KPI Toolkit 2024 helps you formulate your KPIs and provides many examples of setting up SMART goals.
By way of illustration, we give below per sector a number of SMART goals examples (the KPIs) with which you can steer and monitor to what extent goal realization is in sight. The examples are only indicative and certainly not exhaustive. The examples focus mainly on the M (measurable) from the SMART abbreviation.
Want more information about formulating your goals SMART and creating interactive KPI dashboards? Then contact us now.
Assess your people with SMART goals
An important part of professional, incorruptible and driven management is the way in which the entire assessment and reward system of employees in an organization is set up and designed. In a successful, intelligent organization, people are central to executing and managing business strategy.
When it comes to the question of what a good starting point is for conducting meaningful assessment, progress and performance conversations with employees, HRM experts usually agree pretty quickly: without clear, SMART goals, it’s not going to work. But then how do you determine those goals via the SMART principle? That’s the key question.
In practice, formulating goals is usually already quite a tour de force. Let alone that the goals also have to be SMART. Discussion partners quickly get bogged down in discussions about definitions, procedures, priorities, salary scales and bonuses. Therefore more and more people are now saying that the entire appraisal system should be abolished. Even scientists are floating along on this sentiment.
Frustrations reign supreme
Appraisal interviews produce nothing but frustration according to managers and employees alike, according to a seven-year study by Human Resources Management lecturer Kilian Wawoe of VU University Amsterdam. Managers’ annual evaluations of employees are demotivating and have no positive effect on performance. The researcher therefore advocates abolishing this system and replacing it with ongoing coaching. This coaching does not focus on the past, but on how an employee can become better at his or her job, and achieve their SMART goals faster.
Don’t turn performance appraisal into a judgment call
Over the past seven years, Wawoe conducted research among hundreds of employees and managers. This also shows that they find appraisals to be a waste of time and money. Employees feel that reviews are not created fairly. It turns out that only a small part of the appraisal score employees receive can be traced back to performance.
In addition, according to the VU researcher, other factors play a role that have nothing to do with performance management or the SMART method. For example, men are rated better than women. Not because they are better, but because they are more opinionated and managers do not feel like conflict. This is why the appraisal interview is popularly called the “judgmental interview.”
Ongoing coaching good alternative
So Wawoe looked at companies that are doing things differently. What he noticed in these organizations is that teams performing at top levels all work with ongoing coaching and forms of Lean management. Team members are told throughout the year how they are performing and how they can do even better. This not only increases employee performance, but also satisfaction. And it substantially lowers the risk of stress and burnout.
The SMART KPI Toolkit 2024
Having SMART goals is step one, but how do you determine if you're making progress towards achieving those goals? You need SMART KPIs. Passionned Group's SMART KPI Toolbox will help you define the essential KPIs for your organization. This essential handbook contains many KPI examples from a myriad of industries, as well as in-depth explanations and exercises.
Outdated objectives
Companies and organizations cling to the current system of appraisal because it is transparent and provides certainty. Objectives are often set in January and in December the manager assesses whether the employee has met his objectives. The problem, however, is that the goals often do not take into account the complexity of the work. Moreover, they may be outdated by February. In short: no SMART goal. What remains, according to Wawoe, is a conversation about outdated goals rather than what someone has done all year. The result: disappointed employees who have no confidence in an honest assessment by their manager, no matter how well the goals are formulated according to the SMART method. Let’s get back to basics.
Tight deadlines
On paper, the process of strategic goal setting seems simple: set specific, hard-to-achieve goals with tight deadlines. Don’t worry too much about how the goals were arrived at: by negotiation, or by the handing over of a list of goals to be achieved and due dates by the boss. At the same time, publicly announce which goals have been formulated, ideally, of course, using the SMART method. Diligent people with great perseverance “automatically” ensure the desired, predictably high business performance.
Act consistently
But practice is recalcitrant. Indeed, American management consultant Dick Grote notes in an article in the Harvard Business Review that most companies and managers ignore Locke and Latham’s five basic principles or do not apply them consistently and consistently. As a result, expected peak performance fails to materialize. Grote notes that three modern management practices run counter to Locke and Latham’s five basic principles: SMART goals, cascading goals, and assigning relative weighting factors to goals.
Unsuccessful goals, but formulated SMART
By now, entire generations of employees in business and institutions have grown up with the SMART principle. Goals must be Specific, Measurable, Acceptable, Realistic and Time-bound; that is how it has been hammered into everyone’s heads. There are some variations here and there on the same theme, Instead of Acceptable, Ambitious (does the goal actually bring about real change?), Actionable (does something really need to be done for it?) or Demonstratable (which person is going to pursue which goal?) are also often used. However, the essence always remains the same. The SMART method provides a good foothold for many people facing goals for the first time. However, as mentioned, strict adherence to the SMART formula encourages low goal setting and, unfortunately, does not prevent the creation of unsuccessful plans that will never lead to goal realization, entirely according to the rules.
Avoid a cascade of goals
Managers are often advised to land goals from the top of the organization to the shop floor. Within this “cascading” approach, the president or CEO sets their goals first. This is followed by the vice president who, in turn, aligns their goals with those of their boss so that together they can meet organizational goals. Next, the country directors, business unit managers and supervisors start formulating their SMART goals. Finally, it’s the people on the shop floor’s turn to set their goals. They, of course, neatly align them with their supervisor’s goals. No one will take it into their heads to somehow challenge the goals of their “superiors.”
Everyone is waiting on each other
A disadvantage of this rigid “cascading of goals” in practice is often that people sit around waiting for each other. As long as the manager has not yet defined his goals, the subordinate cannot continue to formulate his goals SMART. In theory, this process can drag on endlessly, with people sitting around pointing at each other. One colleague accuses another of needlessly delaying the process. Another risk is that important goals belonging to someone’s unique job function are left out of the process, simply because there is no direct relationship to the supervisor’s goals.
Hand-holding and haggling
Obviously, some goals are more important than others but assigning percentage weighting factors to goals to indicate their importance is usually counterproductive, according to Grote, and here’s why: It is impossible to assign an exact percentage. Take a specific goal, for example, “granularity,” or degree of detail information. The consideration of whether this goal should factor in 20 percent or 25 percent is almost impossible. And as a result, which objective gets 5 percent more or less weight? It quickly leads to horse-trading and endless haggling.
Beware of false accuracy
Using percentages to indicate the importance of goals presents evaluators with an even bigger problem. If they rate people on a five-point scale and apply percentage weighting factors to the individual goals and work with arithmetic averages, they end up with a score that may be as high as two decimal places. Thus, you create false accuracy and false certainty.
The SMART formula: avoid a mathematical approach
Maybe this aforementioned mathematical approach is perfectly sound, but it’s really just nonsense. Performance assessment is not a mathematical exercise. An objective assessment depends primarily on the personal judgment of a professional manager. Unfortunately, there is no technique that simplifies the system of formulating goals SMART and leads to straightforward assessments. But as Latham and Locke show in their research: investing in goal setting does pay off. The payoff can be substantial. But then you have to be careful about cascading goals like a balanced scorecard. You will have to avoid the weighting factors. Finally, do not fixate too much on the SMART formula.
Three tips for formulating SMART goals
Grote concludes his article with three handy, practical tips for anyone getting started with SMART goal setting:
- Do not use the acronym SMART to determine which goals are wise and worth pursuing. Use the methodology only to check that you are formulating your goals correctly.
- Let go of the rigid idea that all individual goals must have a direct and tight relationship to the supervisor’s goals. Individual goals do not necessarily have to relate to the areas that the supervisor or management team has identified as important. Of course, it is important and logical to align with the goals formulated by the immediate supervisor. However, in modern-managed companies, there is also plenty of room for the fulfillment of individual goals. Consider the goals of your immediate supervisor as an important fact. However, these goals should not completely overshadow or exclude the individual goals of the employee.
- Do not assign percentage weighting factors to the goals. Instead, use more global descriptions such as high, medium and low priority goals. Or rank goals based on importance (e.g. using a dashboard) to indicate that some individual goals are more important than others.
Break the rigid assessment ritual
Two partners from McKinsey & Company, Elizabeth Hioe and Sabrin Chowdhury, also shed light on the recurring problem of conducting appraisal and performance reviews. Anyone who has ever done a survey in their company will conclude that almost no one is 100 percent comfortable with this annual ritual, the partners note.
Don’t be too rigid in SMART formulation
Even high-functioning employees become demotivated if you confront them with rigid or arbitrary goals, even if you formulate them SMART. The two McKinsey partners address this sensitive issue in a compact article. They say the trick is to turn a tedious ritual into a positive experience centered on personal growth and learning. For too long, goal setting has been a time-consuming, mathematical and ineffective process. It is time for a turnaround.
Adjust your SMART goals in real time
When setting goals for employees, you will need to keep in mind three key concerns:
- Involve your people from start to finish. When it comes to improving performance, it only makes sense to involve people themselves directly in the entire process. This breeds commitment and employees will develop a sense of “ownership” when it comes to goal achievement. Meeting certain goals encourages the continuous improvement process.
- Connect individual goals to organizational goals. 91 percent of the companies, that implemented an effective performance appraisal system, say employee goals are related to company priorities. The explanation for this is simple: people like being able to see how their contributions fit into the bigger picture.
- Adjust goals in real time. Goals should not be formulated statically; they should be dynamic. They should be able to evolve. A well-known pitfall is to set goals at the beginning of the year and then move on to the order of the day. Only at the new round of assessments are the goals pulled out again. Meanwhile, the original goals are overtaken by reality. Of course, goals don’t have to be “moving targets,” but you should adjust your goals regularly as the environment demands. Goals should also be adjusted as soon as the assumptions underlying them change unexpectedly.
Become smarter with Passionned Group
The Passionned Group specialists are happy to help you take a step further in implementing SMART goals, on your way to an intelligent, data-driven organization.
- we always work from the principle of making organizations smarter
- we use an integral approach with agile work, KPI’s and data-driven work
- we are 100% independent and not tied to suppliers
Contact us here for an introductory conversation about the SMART goal you have in mind.
About Passionned Group
Passionned Group is a specialist in SMART goals, continuous improvement and smart organizations. Our experienced consultants help companies tilt towards a SMART organization. Every other year we organize the election of the Smartest Organization of the Netherlands. 
