Why must HR have SMART goals in 2021?

Why HRs must have SMART goals in 2022?

Fast-track company growth, enhance brand reputation, and create a happy, productive environment for employees with these smart goals for human resources.

Mary Madhavi Reddy
Mary Madhavi Reddy

The HR function is generally considered as the gatekeeper to an organization’s productive workforce. It’s a strategic business partner that enables organizational growth, among other things, by hiring the right talent, aligning learning and development objectives to organizational needs, etc.

But HR is no longer a support function responsible solely for hiring and retention. As organizations begin to embark more aggressively on their digital transformation journeys, new operational norms will fall into place. And here is where HR revisits their fundamental goals, such as hiring new talent, employee retention, communication, employee appraisals, etc., and align these goals to changing realities. And thus, realign policies and processes.

Goes without saying that HR decisions have a direct impact on the organization’s business goals making it important that HR have the right SMART goals.

What are SMART goals, and why should HR professionals set them?

As organizations focus on innovation or growing their business through new market opportunities, an HR goal that says "increase hiring by 200% compared to last year" would be going off on a tangent from the organization's goals.

SMART goals bring the much-needed clarity and alignment. SMART is an acronym for Specific, Measurable, Attainable, Relevant, and Timely - typically goals that aren't vague, misguided, or impossible to achieve. SMART goals break down the organization's overarching vision into small, bite-sized chunks for every department that they can use to set their members' KPIs (Key Performance Indicators) and OKRs (Objectives and Key Responsibilities).

SMART goals help the HR department keep the organization's objective always in sight and work towards the greater good of the organization. Without goals that are specific, measurable, achievable, relevant, and timely, even the most well-intentioned plans can fall through. SMART goals give HR professionals tangible targets and the means to achieve them, keeping them focused and motivated throughout. HR professionals can notch their progress against set milestones. They can easily identify any deviation from the predefined path and immediately course correct it, minimizing time and resource wastage.

SMART goals help HR quantify their requirements, so they have a clear understanding of what needs to be asked from the board, whether in terms of budget and resources, to meet their goals. In the same vein, SMART goals also help quantify the results, such as percentage contribution to the organization's overall growth in terms of brand enhancement, better employee feedback, and an improved skill pool.

When followed consistently, SMART goals give the company culture a significant  push in the right direction, making it desirable for both future candidates and investors.

Examples of SMART Goals for Human Resources

If, for instance, the company had to cut costs then the HR department's SMART goal would be to "increase annual retention from 80% to 90%." The reasoning: the company cannot afford to lose existing talent since it can’t hire new people.

During economic upheavals, companies may become complacent about retention harbouring the impression that employees value job security over anything else and hence will not take a risk by switching jobs. However, the April 2021 report by the Bureau of Labor Statistics (under the U.S. Department of Labor) reveals that there's little change in employee turnover compared to the previous years, which makes the SMART goal of retention even more relevant. This SMART goal can be further broken down into tactics to achieve the goal, such as Rewards and Recognition programs to motivate employees, opportunities to upskill/reskill, etc.

Let's look at some more examples of how SMART goals for HR professionals would look like:

SMART goals for HR Professionals #1: Talent Acquisition

Companies looking to hire may seek to reduce their cost-per-hire. The talent acquisition team should therefore reduce expenses attached to the recruitment process (such as reviewing applications and interviewing candidates), travel and relocation for the selected candidates, and other administrative tasks. Since most of the hiring now happens virtually, recruiters need to make their screening process more efficient so that only the suitable candidates get netted, and team leads needn't waste precious time interviewing ill-suited candidates.

So, a SMART goal for Talent Acquisition would be:

I want to reduce the cost-per-hire by 20% at the end of this quarter by making my screening process more efficient.

Breaking down the goal into its components, we get sub-goals that are

  • Specific: I want to reduce the cost-per-hire
  • Measurable: by 20%
  • Attainable: by making the screening process more efficient
  • Relevant: to help the organization manage its costs
  • Timely: at the end of this quarter

The goal now sets a clear direction for the team and gives them the means to achieve it. The target is realistic, and results are tangible, which motivates the team towards it.

SMART goals for HR professionals #2: Retention

As we discussed already, employee retention is the need of the hour and takes precedence over hiring. HR needs to make its employees feel valued and instill pride and loyalty towards the organization in them, something that pay hikes alone cannot do. Here's how a SMART goal for retention could look like:

I want to improve my employee retention rate to 90% from 80% last year by making employees feel more valued.

Breaking down this goal into its components, we get sub-goals that are

  • Specific: I want to improve my employee retention rate
  • Measurable: to 90%
  • Attainable: from 80% to 90% in a year
  • Relevant: to reduce churn and save the company replacement costs
  • Timely: in a year

The means to this goal could be sending goodie bags with appreciation notes, quarterly rewards for hitting targets, promotions and pay hikes, etc.

SMART goals for HR professionals #3: Upskilling and Reskilling

A recent survey by Gartner involving HR professionals - Top 5 Priorities for HR Leaders in 2021 - revealed that 68% of HR leaders surveyed prioritized building critical skills and competencies. Upskilling also significantly impacts hiring and retention. Companies can train their existing workforce in new skills instead of hiring new talent for them (which is the costlier option). Employees are less likely to leave an organization if they're given opportunities to learn and grow.

A SMART goal for upskilling (or reskilling) employees would be:

I want to allocate 20% of the annual HR budget towards skill development and make employees learn one new skill per quarter.

Breaking down this goal into its components, we get sub-goals that are

  • Specific: focus on skill development
  • Measurable: track progress in performance after learning the skill
  • Attainable: allocate 20% of the annual HR budget
  • Relevant: better performance and improved employee satisfaction
  • Timely: one new skill per quarter

HR can either invest in online certification courses that employees can choose (which are relevant to their work) or hire external instructors to train teams.

SMART goals for HR professionals #4: Performance Appraisals

Yearly performance appraisals are arguably the most taxing times for leaders and employees alike. Pent up emotions flare up as grievances are aired; some employees even make impulsive decisions to quit. Here's how a SMART goal for performance appraisals could look like:

I want to make the performance appraisal process hassle-free for employees and managers by encouraging open communication and regular feedback.

Breaking down this goal into its components, we get sub-goals that are

  • Specific: make the performance appraisal process hassle-free
  • Measurable: employee OKRs
  • Attainable: encourage open communication
  • Relevant: reduce the hassle that makes employees disgruntled or causes them to quit
  • Timely: routine feedback

Open communication coupled with regular feedback ensures there are no surprises during the D-day, making the process tension-free and enjoyable to both managers and employees.


As the American businessman Douglas Conant says, "To win in the marketplace, you must first win in the workplace." HR professionals help companies achieve this victory through their policies, and SMART goals are what enable HR to craft successful policies. SMART goals lift the fog and help HR professionals see a long way down the road. They also provide clear milestones, signals, and signposts so that HR never loses its way and always reaches the destination - a fast-growing company with happy, productive employees.

HR Digital Transformation
Mary Madhavi Reddy

Mary Madhavi Reddy LinkedIn

Mary is a content marketer with 20 years of experience. Her career spans GE Money, Google, and some growth-stage startups. At Empuls, she handles product messaging and positioning.