Setting SMART Goals in Lean & Six Sigma

Today, most competitive businesses that seek to drive continuous improvement and operations excellence rely on Lean Six Sigma initiatives. For a business organisation to actively do continuous improvement, Lean Six Sigma and its tools must be fully utilised. Usually, the broadly used tools like TPM, root cause analysis, value stream mapping, kanban, etc. get attention. However, for all these techniques to be successful goal setting is of paramount importance.  

 

In Lean and Six Sigma, goal setting is a crucial activity. It defines the framework and roadmap of achieving maximum efficiency and zero wastes/defects. And one such tool that forms the basis and strengthens the successes of any Lean Six Sigma initiative is SMART goals. The word S.M.A.R.T. is actually an acronym that stands for:

 

S – Specific 

M – Measurable

A – Achievable
R – Relevant
T – Time Bound 

What are SMART Goals? 

Let us look at what each of the letters stands for and its meaning in goal setting for Lean Six Sigma projects. 

 

1. Specific – The goal should be defined clearly with all its specificity. There should not be any room for vagueness or lack of clarity. 

 

2. Measurable – The goal should be quantifiable and measurable. It should include a standard for measuring progress and verifying results. 

 

3. Achievable – Setting realistic and achievable goals. One that can be completed given the time, resources, and manpower.  

 

4. Relevant – The goals should be set according to the company’s broad objectives and must align with the organisation’s/ company’s values. 

 

5. Time Bound – The goals must be set with a deadline so as to ensure faster achievability. This will create a sense of urgency and accountability amongst the team members. 

 

Setting SMART goals gives a solid foundation and roadmap to a company’s Lean implementation. When each task or business operation is performed as per the clear-defined  goals, it enhances the success rate of continuous improvement initiatives. 

 

How to write a SMART goal statement?

Business must understand that there is a way to write a smart goal statement that makes it simple for the rest of the team to follow. 

 

1. Specific – Smart goals force specificity and eliminate the scope of setting vague or unclear objectives. One must write as the specificities and precisely of goals by writing questions like: 

• What is required to be achieved?
• Why is this goal important to achieve?
• What are the expected results from this goal?
• Who will be at the forefront of achieving this goal?
• What purposes does this goal serve?

 

For example: A goal like “improve customer satisfaction”, though a noble pursuit for business, is still too broad and vague. Instead, businesses should focus on the specificity of the goal. A company can set a specific goal like: improving the customer satisfaction rate by 20% by the end of the second quarter, focusing on quick redressals and response time. This statement gives a deadline, expects a certain % of improvement and how the goal will be achieved. 

 

2. Measurable – Measuring is extremely crucial for a team to know whether their set objectives are producing desirable results or not. Using the right KPIs (Key Performance Indicators), a company can track the relevant performance output which is quantifiable and assess the successful completion of tasks. In other words, you need a criteria to measure the success of your goals. The questions one must ask are:

 

• What kind of data needs to be collected and processed?
• What KPIs does one need to track and measure?
• How will you measure if the goal has been reached?
• At what steps, there is a need to measure results?

 

For example: Instead of writing a statement like “reduction in defect rates in manufacturing operations”, the goal should be reduction of defect rates in manufacturing operations by 40% over the next 5 months. 

 

3. Achievable – It’s crucial that businesses set goals with the scope of achievability based on their given resources. One must assess the feasibility of their goal and the potential threats/defects that can create a hurdle in achievability. 

 

For achievable goals, write the following questions like: 

• Is the goal valuable or reasonable, considering our priorities?
• What are the resources we have at our disposal to achieve this goal? 
• What additional resources will be required to achieve this goal?
• What hurdles may arise in the process of achieving the goals? 

 

4. Relevant – Relevancy is essential in goal-setting. Consider whether the goal aligns with larger objectives of the company or is relevant enough to work on.  Also focus on people who are required to work on the initial goal statement have the relevant authority or freedom to take initiative and lead on. Therefore, the question should be like: 

 

• Is the goal relevant to our company’s broader vision? 
• Why is the current goal a priority over others? 
• Is the time right to achieve this goal or can it be delayed? 
• What will be the impact of this goal?

 

For example, if your company is seeking to achieve a goal of increasing sales, the relevant goal will be increasing sales by 20% over the next two quarters. 

 

5. Time-Bound: Setting goals and working towards them will not be helpful, if there won’t be a deadline or a sense of accountability to fulfil them. Therefore, setting a timeframe and completing the goal within a specified deadline is crucial. For a time-based goal, ask specific questions like: 

 

• What is the deadline of achieving the goal?
• What steps are needed to be taken if the deadline is missed?

 

For example, instead of choosing a goal like “boost customer retention rate”, a time-bound goal would look like: “Boost customer retention rate by 20% over the next 3 months”. This gives the team/workers a set specific goal and deadline of three months in which the goal has to be achieved. Without such a deadline the goal would lose its force and will move nowhere. 

If your business is struggling to set SMART goals, it is essential to seek services of an experienced Lean consultant company. They will analyse your business operations, conduct one-on-one meetups and identify gaps causing hindrance in your business objectives. Remember that if your goals are not SMART, your results may not be either.