We all know that nothing runs without a PLAN, and a plan cannot run without having its objectives set. That applies to any kind of plan, whether we're talking business or personal finances, university degrees, website promotion or weight loss.

THE IMPORTANCE OF SETTING OBJECTIVES

One might wonder why we need to establish objectives in the first place, why not let the company or a specific activity just run smoothly into the future and see where it gets. That would be the case only if we really do not CARE whether the activity in discussion will be SUCCESSFUL or not: but then, to use a popular saying, "if something deserves to be performed, then it deserves to be performed well". In other words, if we don't care for the results, we should not proceed with the action at all.

5 RULES OF SETTING OBJECTIVES -- BE SMART

I am sure most managers and leaders know what SMART stands for, well, at least when it comes of establishing objectives. However, I have seen some of them who cannot fully explain the five characteristics of a good-established objective -– things are somehow blurry and CONFUSED in their minds. Since they can't explain in details what good and meaningful objectives really are, it is highly doubtful that they will always be able to formulate such objectives. Let us try to uncover the meaning of this acronym and see how we can formulate efficient objectives. The 5 characteristics of an efficient objective are 1) specific –- 2) measurable –- 3) attainable –- 4) relevant –- 5) timely.

EXAMPLE

When you tell your team "I need this report in several copies", you did not provide the team with a specific instruction. It is UNCLEAR what the determinant "several" means: for some it can be three, for some can be a hundred. A much better instruction would sound like "I need this report in 5 copies" -– your team will know EXACTLY what you expect and will have less chances to fail in delivering the desired result.

EXAMPLE

"Our business must grow" is an OBSCURE, non-measurable objective. What exactly should we measure in order to find out if the objective was met? But if we change it to "our business must grow in sales volume with 20%", we've got one measurable objective: the measure being the percentage sales rise from present moment to the given moment in the future. We can CALCULATE this very easy, based on the recorded sales figures.

EXAMPLE

You own a newborn movers company and you set the objective of "becoming no. 1 movers within the state". The problem is you only have 3 trucks available, while all your competitors have 10 and up. Your goal is not attainable; try instead a more ACHIEVABLE one, such as "reaching the Top 5 fastest growing movers company in the state".

EXAMPLE

Imagine yourself going to the information technology department and telling them they need to increase the profit to revenue ratio by 5%. They will probably look at you in astonishment and mumble something undistinguished. Can you tell what is wrong with the objective above? Of course! The department has no idea what you were talking about and there's NOTHING they can do about it -- their job is to develop and maintain your computerized infrastructure, not to understand your economic speech. What you can do is set an objective that the department can have an impact upon, and which will eventually lead to the increase you wanted in the first place. What about asking them to reduce expenditures for hardware and software by 10% monthly and be more cautious with the consumables within their department by not exceeding the allocated budget? They will surely UNDERSTAND what they need to do because the objective is relevant for their group.

EXAMPLE

If you just say "we need to raise profit by 500000 units", you will never be able to tell if the objective was achieved or not, one can always say "well, we’ll do it next year". Instead, if you say "we need to raise profit by 500000 units within 6 months from now", anyone can see in 6 months if the goal was ATTAINED or not. Without a clear, distinct timeframe, no objective is any good.