The second model is where goals are described in terms of Key Performance Indicators (KPIs) that need to be achieved in order for the business to realize a successful outcome. KPIs are unique to every organization so choosing the most effective KPIs is based on a clear understanding of the organization’s priorities. KPIs may be described in operational terms (e.g. achieve x outcome by y date) or in terms of general progress towards achieving the business strategy.

This approach is obviously less prescriptive than S.M.A.R.T goals as it is widely open to interpretation depending on the priorities of each business (or indeed each department). However, no matter what “indicator” is chosen, the objective related to the indicator should adhere to the S.M.A.R.T guidelines in order to be effective. Thus, the use of KPIs and S.M.A.R.T goal setting are often complementary as opposed to being mutually exclusive.