Smart objectives – What are they?

Having SMART objectives is very important when starting an endeavor. For example, to raise capital and shares you will need a business plan to present to lenders and banks. 

In addition, a business plan will help you to generate a road map for your business in terms of what it will achieve and how you will achieve it.

It is important that you set out clear objectives so you know what you are aiming for. These objectives will need to go into your business plan.

You’ve likely heard the phrase “When you don’t know where you’re going, any road will do.” Setting the correct objectives will help you reach your ultimate goals.

The most effective way to use objectives is to set SMART ones. SMART is an acronym for Specific, Measurable, Achievable, Realistic and Time-Sensitive.

Specific

Your objectives should be specific and not ambiguous. If you are forecasting that your business will increase sales compared to last year then you need to be specific about what that increase will look like. For example, sales will increase by 12% by the end of the next financial year.

Measurable

Objectives have to be measurable in order to identify if progress is being made or not. Avoid using vague terminology such as; the best, the largest, the fastest, etc. Measurable targets should include sales results, net profit and capital expenditure.

Achievable

Your objectives must be achievable. This means your business needs the capacity and resources available to achieve what you set out to do.

Realistic

It is easy to be carried away by setting objectives based on enthusiasm. However, you need to be realistic when setting your objectives.

For example, if your business has on average increased sales by 10% each year, then stating that your sales number for next year will double is setting up the company for disappointment.

Targeted numbers should be backed up by supporting evidence to prove that they are possible.

Time-Sensitive

Setting a date and a deadline is very important when creating objectives and goals. Not setting a deadline for when the objective will be achieved will likely cause delays and in many cases, the objectives will not be achieved.

Avoid vague terms such as short or long-term. You need to have a clear and specific timeline for the accomplishment of each objective.

What’s so smart about SMART objectives? 

Why has this acronym become part and parcel of project planning and performance management?

When objectives go through the SMART process, they become targets that bring focus, action, feedback and learning.

These targets help in the development of individual work plans and also provide a road map for performance review discussions.

How Do You Write a SMART Objective Statement?

First or all, you must decide what exactly you expect to create, and how you will recognize the result when it comes to pass.

For example, “Our insurance premiums should make a minimum of $60,000 per month in sales by June 30, 2020, with a quarterly increase of at least 5% thereafter.” 

A conversion objective could be “to increase the average value of all subscriptions processed in the firm to $100 per client in the next twelve months”.

The above SMART objectives are attainable because they are very specific regarding what needs to be done, they are measurable, and the time-bound aspect is also included in one short declaration.

Without the time factor, the team responsible wouldn’t know when it has to achieve the target.

Reviewing the smart objectives can be done quarterly, semi-annually or annually. It all depends on the timeline that has been set on the targets.

In a nutshell, SMART objectives have the potential to focus attention, work plans, and commitment to performance targets.

If you would like to learn more about creating and using SMART objectives, contact us for a free consultation. Don’t forget to sign up for our newsletter for more interesting insights on business planning.


Core Values of Your Professional Service Company

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A professional services company’s core values are at the center of everything it does. These company’s core values reflect the company’s purpose, vision, and culture. They are constants that underlie every decision a business makes.

This last point is especially important. No matter what trends in the market come and go or economic changes occur, these company’s core values don’t change. For example, if having strict service standards is a core value of a business, it won’t cut corners during an economic downturn.

Core values are not dependent on industry, type of company, services offered, or the market. They are created by the founders and leaders of a company and based on their vision of the company.

It’s easier to understand core values if you compare them to a family’s values. Some families are very practical, watching carefully how they spend their money and guarding their future savings. Other families value a sense of adventure over security and stability. Company values work in the same way, but on a larger scale.

Examples of core values include:

  • Trust or accountability – A company guarantees that it will provide for clients and employees when they need it.
  • Commitment to quality – A business puts its high-quality standards for its services above all else.
  • Innovation – Some companies are known for their ability to innovate by offering new technology or services ahead of their competitors.
  • Building community – A business may revolve around the idea of creating a positive, supportive community for its clients and employees.

These are just a few examples of the countless possibilities and combinations of core values. Once you clearly identify your company’s core values, these will define every marketing campaign, client interaction, employee hire, service delivery, and more.

For more information on identifying and using core values in your professional service company, check out our report titled, “From Values to Profit: Defining the Principles that Drive Your Professional Service Business Success.”

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