What Are SMART Goals? Examples for Small Business

What Are SMART Goals?

Textbook Definition

SMART is a goal-setting framework requiring that objectives be Specific, Measurable, Achievable, Relevant, and Time-bound, so that progress can be tracked and accountability is clear.

In Plain English

A SMART goal is a target everyone understands the same way, with a number and a date. "Grow" is not one. "Sixty members by the end of the season" is. If you cannot count it, it is not specific yet.

Why Do Vague Goals Pull a Team Apart?

Your team cannot read your mind. You know what you mean by "grow." You can see it. But "grow" is not something anyone can do. It is a mood. One person hears "more classes." Another hears "lower prices." Both work hard, both are right, and the business goes backward.

A SMART goal fixes that by giving everyone the same target. The few numbers you watch every week to see whether you are winning are called key performance indicators, or KPIs. When the whole team can see them, you get alignment: everyone pulling in the same direction.

Alignment does not come from telling people to work harder. They are already working hard. It comes from letting them see what winning looks like, in numbers they can check themselves. Once the target is clear, your team will start judging their own ideas against it, and you stop being the only person who knows whether an idea helps or hurts.

Signs you have this problem:

  • Your goals are words like grow, improve, or do better.
  • Ask five employees the goal and you get five answers.
  • The team is busy, but the numbers are not moving.
  • You have ten goals on the board and nobody knows which comes first.
  • Two people's good ideas cancel each other out.
  • You do not know your monthly number after all the bills are paid.
A goal nobody can count is a wish. People want to do well. Show them what well looks like, in numbers.

What It Looks Like When the Goal Is a Mood

From the Fabled Forest · Chapter 11

Visionary Veronica hired her first two employees, a pair of flamingos, and told them the most important thing: grow the business. She even ordered a banner for the door. It said one word: GROW.

Two days later, one flamingo had added four new classes. The other had put up a half-price sign with a free friend deal. Both were working hard. Together, they were teaching twice as much for half the money, and the till had less in it than the month before.

Doctor Owl asked Veronica what number would tell her the growth had worked. She wrote ten goals on the board. The flamingos each picked a different one. So Doctor Owl erased all ten and started over with five letters.

Veronica's story is Chapter 11 of Management and Leadership for Small Businesses, Book 1 of Dr. Paul's Fabled Forest Business School Series.

How to Write SMART Goals in 4 Steps

Three goals. Five tests each. One wall where everybody can see them.

  1. Write what success looks like this season in plain words.

    Start messy. "More members, fuller classes, more money left over." That is fine for a first draft.

  2. Turn each one into a number with a date.

    How many, by when? "More members" becomes "60 members by the end of the season." If you cannot count it, it is not specific yet.

  3. Check each against all five letters, and keep only three.

    Specific, measurable, achievable, relevant, time-bound. A stretch is allowed. A fantasy is not. Three goals is plenty for one season.

  4. Post them where the team sees them, and update weekly.

    Write the goal and today's real number next to it. Change the real number every Friday. Everyone can tell for themselves whether it is working.

Dr. Paul's Insight

The classic mistake is writing ten goals. Nobody can aim at ten things, so everyone quietly picks a different one. Three numbers, posted on a wall and updated every week, will do more for a small team than any speech about working harder.

Worked Example: Is the Money Goal a Stretch or a Fantasy? 60 members × $60 a month = $3,600. Drop-in classes add about $600. Total: $4,200. Rent $2,000 + wages $1,600 + loan payment $400 = $4,000 in bills. $4,200 − $4,000 = $200 a month left over, if everything goes right. So $200 is a stretch goal. $2,000 would be a fantasy. Run the math before you post the number. Figures are an illustration to show the math, not a projection for your business.

Sample: From "Grow" to Three SMART Goals

Here is one vague goal turned into three SMART goals and the numbers to post every week.

Season: FallUpdated: Every Friday
Vague goalGrow the studio.
SMART goal 160 members by the end of the season. Today: 40.
SMART goal 2Every class at least three-quarters full by the end of the season. Today: about half.
SMART goal 3$200 left over each month, after all bills, by the end of the season. Today: below zero.
KPIs to postMember count, average class fill, and money left over. Updated in a box beside each goal, every Friday.
Test every idea against the threeA half-price sign helps goal 1 and hurts goal 3. A class nobody attends hurts goal 2. Keep the ideas that help without hurting.

Sample for illustration. Use your own three numbers.

Video: Turn "Grow" Into Three SMART Goals

Video Coming Soon

What Are SMART Goals? Examples for Small Business

Dr. Paul rewrites a vague small business goal into three SMART goals and a weekly KPI board.

What Would You Count?

Chapter 11 · SMART Goals

Grow Is Not a Number: An Elephant's Target

"Veronica," said Doctor Owl. "If EleWell grew perfectly this season, how would you know? What would you count?"

"Count?"

"Members? Coins? Classes? What number would tell you it worked?"

Veronica thought about it. Then she brightened, and went to the chalkboard, and began to write.

How many goals did Veronica write, and how did the flamingos finally pull in the same direction? It is all in Chapter 11. Book 1 of Dr. Paul's Fabled Forest Business School Series.

Get the Book on Amazon →

SMART Goals Questions

What does SMART stand for?
Specific, Measurable, Achievable, Relevant, and Time-bound. Specific means everyone knows exactly what it means. Measurable means you can count it. Achievable means it is a stretch but possible. Relevant means it matters to the business. Time-bound means it has a date.
What is an example of a SMART goal for a small business?
"Reach 60 paying members by the end of the season" is a SMART goal. It is specific, countable, realistic if you start at 40, relevant to revenue, and has a deadline. Compare it to "grow the business," which nobody can measure or act on.
What is a KPI?
A KPI, or key performance indicator, is one of the few numbers a business watches regularly to see if it is winning, like member count, sales, or average order size. The KPI is the measure. The SMART goal is the target you set for that measure.
How many goals should a small business have?
About three per season. Fewer than three can leave out something important. More than three spreads attention so thin that people quietly pick different goals and pull in different directions. Three posted goals, updated weekly, keep a small team aligned.

Written by Dr. Paul Borosky, DBA, MBA, business consultant, author, and educator with 14+ years and 1,000+ clients served. Need help picking the three numbers that matter most for your business? Dr. Paul works with owners one-on-one.

This page is for general educational purposes only. It is not legal, financial, tax, accounting, or other professional advice. Dollar figures are illustrations. The Fabled Forest and its characters are fictional. For decisions about your own business, consult a qualified professional.