Today, SMART is THE cliche of the personal development world. It’s the equivalent of a student ending his essay with, “…And then he realised it was just a dream.” It makes us all roll out eyes.
All my life, I’ve been setting SMART goals like “Get a six-pack by the time I graduate” or “Get promoted by the end of this year.” Sometimes my readers email me with questions on their SMART goals like, “How do I grow my portfolio by 2% every month?” (Uhm, I don’t know. Join a drug cartel?)
In the past, I used to believe that SMART goals were the only types of goals you should set. But lately, I’ve started to wonder if there could be another, better way of looking at our goals.
The Downsides of SMART Goals
Sometimes you can’t quantify your goal
A couple of years ago, I went on the Slow-Carb Diet (popularised by author Tim Ferriss) for 13 weeks. My goal was to lose 5kg by a certain deadline. Very specific, measurable, achievable, relevant, and time-bound.
Here’s the thing: After about 8 weeks, people were already commenting about how much weight I’d lost. I’d managed to rock a tight T-shirt and was feeling great. It fact, my work pants were becoming too loose for me. However, by that time I had only lost 3kg instead of 5. By all accounts, I was successful, except in the “Measurable” aspect of my goal.
I realised that my REAL goal was aesthetics. I wanted to lose that tummy, look good and rock a tight T-Shirt.
However, for the sake of making it SMART, I jumped on an arbitrary figure of “Lose 5kg”. While it gave me a clear goal to work towards, it was also over-specific. Even though I was successful when compared to my aesthetics goal, I was a failure when compared to my SMART goal.
In other words, it was too clear-cut. After hitting my 65kg goal, I was so exhausted from my dieting plan that I stopped taking action… which eventually led me to gain back all the weight I had lost a few years later.
The most interesting goals are usually uncontrollable
When it comes to investing, people always make goals like “I will grow my portfolio by 20% by the end of the year.” Unless you have a “portfolio” of cash and you physically added 20% more to it, your absolute return is often beyond your control.
The market doesn’t care about your goal. It does whatever it wants: It might shoot up by 30% this year without you lifting a finger, or it might plummet faster than my self-control around a plate of Indomie.
I’ve observed that the most interesting goals share this common trait of uncontrollability. Setting goals in investing, career, sales, social skills, etc often mean that – as hard as you try – you don’t get to control the outcome.
That’s why the SMART framework falls apart here. It makes the conditions for success/failure too clear cut: “If I don’t grow my portfolio by $100K by 31 Dec 2017, I have failed.” When in reality, maybe all you needed was to wait a couple more months for the market to recover.
I’m not saying that ALL SMART goals are stupid. There’s often value in applying the SMART framework to goals that are very clear-cut and achievable. But for the most ambitious and interesting goals, there’s a better way to apply the SMART framework:
Set SMART Systems
The difference between systems and goals is simple: Goals are results you want, systems are what you DO to get there.
- If your goal is to write a book, your system is your writing schedule
- If your goal is to transform your body, your system is your fitness and diet regime
- If your goal is to grow your wealth, your system is your automated savings and investing schedule
See the difference?
When it comes to the most interesting goals, I find it a lot more useful to apply the SMART framework to systems rather than overly focus on the results. For example:
- “Every Monday and Wednesday, I will follow my personal training programme for a period of 12 weeks.”
- “Every 1st of the month, I will invest $200 into an Exchange-Traded Fund until my salary increases.”
- “Every day, I will cold-call 5 prospects for the next 4 weeks.”
Because they’re not focused on the results, SMART systems let you adjust your approach without feeling guilty that you’re “quitting” on your goals. Your ambitious goal still remains the same, but your systems can change.
Now, if you ignored your goal and only focused on the system, would you still get results?
I think you would.
For example, I’ve been investing a fixed amount of money into my portfolio every month, without fail, for the past 6 years. I didn’t have any “goals” besides growing it as large as possible.
But by focusing on a system for investing a fixed small amount regularly, I often pleasantly surprise myself when I see that the portfolio has grown to a pretty significant sum, despite having very limited control on the outcome.
So today, think about your most ambitious, audacious goals. Instead of constraining yourself to a “SMART” goal (which often limits it to something mediocre), think about how you can apply a system to get there.
PS: One of my SMART systems of 2017 is to follow a personal training exercise and diet regime. I just joined a personal training gym near my office – it’s been only 3 sessions so far and I end every session crawling out like a dying beetle, but it feels amazing. I’ll chronicle my experience as I go along.