Business aims and objectives - EduqasUse of SMART objectives in business
All businesses create aims and objectives to give them goals or targets to achieve. Businesses have a range of stakeholders that are all impacted in some way by aims and objectives.
Business objectives are often created using the SMART acronym. This makes objectives clear and easy to understand, whilst making sure they provide clear goals for a business.
The SMART acronym stands for:
S 鈥 Specific. This means that objectives must be clear, for example it must state that a business needs to make more profit, reduce waste, reduce environmental impact, increase sales
M 鈥 Measurable. A business must be able to measure whether they have met an objective. A business needs to specify an amount. For example, a business may want a 拢10,000 increase or a 25% decrease
A 鈥 Agreed. Stakeholders in a business must agree about their objectives, this will give objectives a much better chance of succeeding
R 鈥 Realistic. Objectives must be realistic for the size and scale of the business. For example, a small caf茅 wouldn鈥檛 have an objective to make 拢1 million profit
T 鈥 Time-bound. Objectives must have a time limit, for example 6 months or 1 year
Examples of SMART objectives include:
To make an additional 15% profit within the next 12 months
To increase sales by 拢7500 each month for the next 6 months
To reduce waste by 50% in the next 6 months
To reduce staff turnover by 10% within the next 12 months