Smart Goals Demystified: Are They as Effective in the Real World as We Think?
1. Goal Setting: Towards a SMART Approach
George T. Doran first introduced the SMART framework for goal setting in an article published in 1981. The article was titled “There is a SMART way to write management goals and objectives” and can be summed up with the following ideas:
Doran hoped that SMART goals could provide a more precise vocabulary that managers can use when discussing organisational strategy and objectives, leading to what he calls “management excellence”.
2. Performance Management with SMART
As with countless other original ideas, and in addition to business management, the SMART framework made its way to personal development and performance management and is now a standard method for objective setting and performance evaluation.
This article will first describe SMART as it is currently understood. We will then provide some thoughts on its efficiency in the real world. The story we are trying to tell can be summarized as follows. S.M.A.R.T. was originally proposed in 1981 by Doran as a method for helping managers write down organisational objectives and goals. Since then, two things happened.
Context Shift
The ideas behind SMART were applied to employee performance management, a different context than the one in which Doran initially operated. In general, S.M.A.R.T. and almost all other methods are never universal but bound to a limited domain of applicability.
Popularisation
SMART has become the tool of choice when it comes to goal setting for employees. It is taken for granted, assumed to work under any conditions, and limitation-free. These assumptions are invalid, as we hope to demonstrate later in this article.
We will review these two thoughts in greater detail later, but first, let us understand the modern concept of goal management with SMART.
3. What Is the S.M.A.R.T Framework?
Setting and achieving goals is a fundamental aspect of personal and professional growth. The concept of SMART goals provides a structured framework to enhance the effectiveness of goal-setting processes. SMART is an acronym for Specific, Measurable, Achievable, Relevant, and Time-bound—criteria that collectively ensure goals are well-defined and attainable.
The Five Pillars of the SMART Method
3.1 Specific (S)
The ‘S’ in SMART emphasizes specificity in goal formulation. A specific goal provides clear direction, leaving no room for ambiguity. When setting specific goals, answering the fundamental questions of who, what, where, when, and why is crucial.
3.2 Measurable (M)
Measurability ensures that progress can be quantified and tracked. Measurable goals enable individuals and organizations to gauge their advancement toward the desired outcome. Incorporating tangible metrics provides a concrete basis for evaluation.
3.3 Achievable (A)
The ‘A’ in SMART stresses the importance of setting goals that are realistically attainable. While ambition is commendable, goals that are too ambitious can lead to frustration and demotivation. Achievable goals strike a balance between aspiration and feasibility. It involves assessing available resources, capabilities, and potential obstacles.
3.4 Relevant (R)
The ‘R’ component emphasizes the relevance of goals to the broader mission or vision. A relevant goal aligns with the overall objectives, contributing meaningfully to the larger purpose. This ensures that efforts are directed toward outcomes that matter.
3.5 Time-bound (T)
The ‘T’ in SMART underlines the necessity of setting time constraints for goals. A time-bound goal creates urgency, preventing procrastination and fostering commitment. It involves establishing deadlines or milestones for different phases of goal attainment.
4. Caveats and Limitations of S.M.A.R.T
4.1 Doran’s Warnings
In Doran’s article introducing SMART to the world, the author outlines some of the caveats that his readers must be mindful of when using this method for setting organisational goals. In particular, Doran acknowledges that:
Caveats to using SMART
Other limitations may exist, sometimes on more fundamental levels, which we discuss next.
4.2 Tasks Are Anything But Simple and Specific
At least in software engineering and any job requiring significant intellectual effort, tasks will range from the mundane to the complex. In such situations, objectives will be multiple and conflicting, and the time and resources will limit their full achievement. Employees are then called to make judgments to prioritize the vital over the necessary.
For example, there is no obvious choice between quality, scope, and time-to-market if all three are not simultaneously within reach. If a developer makes a call favouring one over the rest, it can always be argued, mostly in hindsight, that something could have been done differently to achieve better results.
In IT organisations, technical or delivery challenges are often unpredictable, and decisions must be made promptly to avoid delays. If the engineer’s objective for the semester is to make timely deliveries, they will naturally be more inclined to favour that over quality or clean code. While achieving the short-term goals, the product will accumulate technical debt, perhaps until it becomes unmanageable.
While an organisation’s long-term goal might be, for example, obtaining and keeping a strategic edge in a market niche, the paths to get there will be numerous and cannot be smoothly planned. Here, the strategic goal is SMART, but the personal-level sub-objectives may never be.
4.3 Anything That Can Be Measured Can Be Gamed
An experiment was run in a hospital to quantify and measure the surgeons’ expertise by tracking the number of successful operations they performed. To keep their scores high, the study reported that some surgeons declined to perform difficult operations for fear of scoring less than their peers.
This experiment perfectly demonstrates two well-known hypotheses about human psychology and complex adaptive systems.
Anything that can be measured can be gamed.
Interventions will always have unintended consequences.
4.4 Focusing on the Short Term
In most cases, business owners care less about profit and margins than the business’s survival in the long term. Not that profits and margins are unimportant, but without a business, there will be no profit.
Long-term survival in a dynamic, competitive, and hostile environment requires actions today, whose impacts might only be visible in the medium to long term.
4.5 Goal-Setting and Strategic Management
Dr Ralph Stacey, author of Strategic Management and Organisational Dynamics: The Challenge of Complexity to Ways of Thinking about Organisations, has argued extensively against the validity and usefulness of long-term strategic planning in organisations where leaders take the role of an external objective viewer diagnosing the organisation’s problems and offering suitable solutions implemented in long-term action plans.
Stacey believes leaders are part of the system, and their perspective is equally subjective and possibly biased. Being an integral part of the system, the leader cannot set objectives, monitor their progress, and correct their direction where needed. New events, including setting objectives, constantly shape the leader’s reality and perceptions.
4.6 Goal-Driven Strategies and Cybernetics
S.M.A.R.T. incorporates some of the principles of cybernetics that were popular at the time of its conception in the 1980s.
Cybernetics assumes that a complex system can be driven towards a desired future state by applying pressure on its leverage points. The pressure to be applied to those leverage points is channelled from the output back into the system through negative feedback loops. If you know how the thermostat works to keep a room at a certain temperature by controlling the airconditioner’s output, then you already know what cybernetics is.
Nevertheless, cybernetics has its drawbacks as a model for real-world organisations. First, it assumes that the entity setting the goal (or leadership for organisations) is outside the system and has an objective perspective. Another drawback of cybernetics is that it doesn’t explain innovation. If cybernetics has these flaws, so does S.M.A.R.T., whose principles are based on it.
4.7 Separating the Individual from the Systemic
Another challenge to performance assessment that S.M.A.R.T. cannot gauge is the degree to which systemic problems, i.e. those associated with the environment, workplace, team, and organisational culture, impact individual performance.
For example, in an organisational culture favouring one set of attributes over another, a smart individual lacking these attributes might be seen as a poor performer despite possessing more powerful and relevant skills not leveraged in this culture.
5. We Need a S.M.A.R.T.er Approach
5.1 Is S.M.A.R.T. Unusable?
Like many other great ideas that get popularized a bit too much, the S.M.A.R.T. approach to goal setting lost most of its originality and innovativeness over time. However, this does not mean that it’s not entirely without merit.
S.M.A.R.T. provided a structured approach to performance management, removing some of the arbitrariness and unpredictability plaguing this task. Furthermore, it gave managers and subordinates a baseline and a common vocabulary to discuss performance. The question now becomes: How can S.M.A.R.T. be improved to overcome its deficiencies? Here are some thoughts on how this can be achieved.
5.2 Keep an Eye on the Intangible
Certain attributes associated with high-performance or high-value employees cannot be placed on a scale. Some of these attributes can be:
Unquantifiable characteristics of high performers
While some of these attributes are synergistic, others may be conflicting. High performers are typically those who can maintain a delicate balance between these attributes. These intangible attributes and their balance can only be gauged qualitatively, but they are great indicators of high performance and value.
5.3 Using Ensembles of Key Performance Indicators (KPIs)
A typical challenge with the measurability of certain indicators is that they can be gamed. One way around that is to create a set of indicators (2-3 at least) where if one indicator artificially goes up, the others will go down, counterbalancing any attempt to game the system. With such ensembles, only a genuine increase in performance can raise the values of the individual KPIs in the ensemble.
An example of an ensemble of KPIs is that used by the Google Page Speed test where, at the time of writing, three primary indicators exist: Largest Contentful Paint (LCP), First Input Delay (FID), Cumulative Layout Shift (CLS).
6. Final Words
Performance reviews and assessments should never be painful to managers or employees and should not detract teams from improving their performance. This means the framework for employee performance evaluation and assessment must be sound, highlighting the problems without creating more.
We hope this article has provided some insights into S.M.A.R.T’s problem and given the manager some food for thought in case they are in the midst of their next round of performance reviews.
7. References
- There is a SMART way to write management goals and objectives, by George T. Doran, 1981.
- Strategic Management and Organisational Dynamics: The Challenge of Complexity to Ways of Thinking about Organisations, by Ralph Stacey.