SMART Objectives refer to a management technique that most businesses prefer to follow nowadays. SMART is an acronym that stands for certain methods used to increase an organization’s efficiency as a whole. Greater efficiency leads to higher profits and turnover. Whether an organization belongs to a manufacturing industry or service industry, an error-free business plan is the key to success.
What are SMART objectives and how do you implement them?
Every business organization is primarily concerned with increasing profits. But a smart entrepreneur will tackle his business with the SMART Objectives method. The acronym SMART means S=Specific, M=Measurable, A=Achievable, R=Realistic and T=Time Bound. The first step in implementing SMART is by identifying a specific objective. For example, if your aim is to globalize the current market base, then identifying the potential overseas markets should be your primary objective. This will involve studying demographics, communication and transportation facilities, buying capacity, local laws etc of the target market. Now you can plan the strategy so that you succeed in capturing the market and sustaining it over a long period of time.
The primary objective would be meaningful only if you it is measurable vis-à-vis Returns on Investment (ROI). When implementing a business strategy you have already set a profit target. The ROI of any business strategy must be high enough to justify its implementation. When your returns are good you know you have adopted the best method of achieving your objective.SMART Objectives technique ensures that your returns are measurable so that you know you are on the path of true success.
Knowing the ground reality
Prior to implementing an innovative business strategy, most organizations will undertake an in-house or external feasibility study. Can this idea be put into practice? Is there an easier way to implement it? Will it cost too much? How fast will it show good returns? Questions like these have to be answered prior to implementation of a business strategy because there is no room for errors. It is imperative that you set objectives for yourself that are achievable and attainable. Studying your company’s infrastructure, capital, current market base, expansion objectives, market credibility with regard to borrowing capacity, etc. will give you a fair idea of how realistic and achievable your new strategies are.
It is human nature to want to reach ones goal as fast as possible. This aspect is also a very important factor when planning and implementing a novel business strategy. Setting an objective is great. But have you identified within what time frame you want to attain that objective? Without having a time scale for your objective, you cannot plan a perfect strategy. In any business targets and deadlines are two sides of the same coin. They have to work together to reach ones objectives. For a well planned path to success SMART Objectives lead the way.