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Companies have various methods of organizing their objectives, goals, and aims. Thus, SMART goals and balanced scorecards allow managers to illustrate where the company is heading and how to get there. However, both frameworks correlate with specific pros and cons that can both advance and compromise organizational outcomes. SMART goals allow businesses to prioritize their objectives and select the most relevant ones based on current conditions (Lazarus, 2004). Moreover, using this model is effective in regards to building a clear vision. It is relatively easy to implement and contributes to a more targeted plan toward corporate success. However, SMART goals are not particularly effective in a dynamic environment where circumstances constantly change (Reeves & Fuller, 2018). Moreover, there is no prevention from the implementation of audacious objectives that do not match the external environment. Another negative factor is the presence of cognitive bias, which may compromise the companys aims.
Balanced scorecards are more complex and extensive. One of the pros of applying this model is the contribution to the companys structural integrity. Thus, a clear picture is built consisting of current measurements and future results. Moreover, balanced scorecards facilitate the employees connection with organizational goals. Therefore, the risk of team members having unclear responsibilities and organizational duties is minimized. However, balanced scorecards are more challenging due to the fact that they require a lot of data gathering. In addition, due to their complexity, they have to be customized in detail based on the organization in question.
Since balanced scorecards examine current measurements with the set objectives, SMART goals can have the role of these objectives. For example, an organization has a customer base of one million users. The SMART goals system suggests the use of specific and measurable objectives. Thus, the balanced scorecard objective can be set at a customer base of two million users in the next four years. Another example would be opening two new offices over the next two years, hiring 100 new employees over the next five years, or increasing production by 10 % in the next year.
References
Lazarus, A. (2004). Reality check: Is your behavior aligned with goals? The Physician Executive, 30(5).
Reeves, M., & Fuller, J. (2018). When SMART goals are not so smart. MIT Sloan Management Review.
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