As a business coach for more than 25 years, I have seen and heard it all. One of the most common things I come across is new leaders that have an unrealistic idea on how to set goals for their business. The majority of them overestimate what their teams or themselves as leaders will be able to accomplish in a quarter or a year’s time.
So today I wanted to talk about something called SMART goals, and share ways that you can incorporate them into your quarterly planning strategy. And while I have talked about quarterly action plans in the past here, I want to explain how they tie in together with the concept of SMART goals.
What are SMART goals you ask?
The S stands for being very specific about what you want to achieve. In your quarterly action plan, you would pick the top three goals that you want to achieve that quarter. Let’s say that this quarter you would like to increase the number of leads that you get into your sales funnel. SMART goals take that idea one step further, by narrowing it down to a very specific focus.
So instead of saying “I want more leads in my sales funnel” you would say “I want 20% more qualified leads that are interested in our product X into our sales funnel.”
The latter is much easier to create a strategy around.
The second letter in the SMART acronym stands for measurability. Let’s say for example your sales team would like to close more sales this quarter and you want to make that one of your goals on your quarterly action plan. While that’s a great starting point, how will your team know that they are successful?
Instead, change the goal to include a number. You want to close 15% more sales this quarter, for example. Or you want to hire 3 new sales representatives to help you achieve a 15% increase in sales.
The third letter in SMART stands for achievable. Let’s look at the prior example. Is a 15% increase in closing rate achievable for your business? If you have in the past seen a 2-3% increase quarter over quarter, a 15% bump may not be feasible and leave you and your team feeling like you failed. But if you chose a goal of 5%, then you may be more successful. So choose your goals wisely.
Next up we have relevancy. This is one that I see a lot, particularly with new business owners. You have lofty goals to conquer the world but may not think about how they fit into the bigger picture. Do the goals on your quarterly action plan fit into the long term goals for your business. How will they help move the needle? If they don’t fit that criteria, it might not be worth including in your quarterly action plan.
And lastly, you want to look at whether your goals make sense from a time perspective. Given the size of your team and a limited amount of time and resources, does your goal make sense? Would your IT team of 1 be able to do a complete website and database overhaul in one quarter? Or does it make more sense to break it down into more manageable goals over the course of the next few quarters?
The idea of SMART goals coupled with a quarterly action plan is an excellent way to make progress within your business and stay on track.