Every business needs a clear direction to succeed. And that comes from business goals!
Without them, you’re setting off on a journey without a map. They guide your decisions and ensure you reach your desired destination on time.
However, the main question is: How to set business goals?
Don’t worry, we’ll learn about that in this blog post.
But before that.
What are business goals?
Business goals are specific targets that a company aims to achieve within a set timeframe. They serve as benchmarks for measuring progress and can be related to different areas of the business.
A goal can be to improve financial performance, enhance market share, streamline business operations, or improve customer satisfaction.
By setting well-defined goals, businesses can ensure alignment with their long-term vision and make strategic decisions that drive progress.
Depending on your purpose, set a business goal that helps advance your business every day.
Types of business goals
Now, there are two types of goals to create actionable strategies in your business plan. These include:
1. Short-term goals
Short-term goals are constrained by a specific time frame, typically ranging from a few hours to a whole year. They are building blocks for your long-term strategic objectives.
Corporations usually make their long-term goals attainable by dividing them into multiple short-term goals.
Some examples of short-term business objectives include:
- Incorporate 100+ new customers in the current quarter.
- Hire 10 new staff by the end of the year.
- Generate a 10% increase in positive feedback
2. Long-term goals
Long-term goals are expansive visions that you hope to accomplish in the future.
A ten-year aim is a typical long-term objective. Consider where you want your company to be in ten years. What corporate goals do you hope to have accomplished by then? Which new industries, if any, are you interested in entering?
Long-term objectives act as a compass for your company to steer it in the appropriate direction. They are frequently utilized as a vision statement or a mission statement. Consider your goals as a road plan that will lead you in the right direction.
Long-term objectives may not offer a detailed roadmap to help you reach there, but they do provide a general direction.
Some examples of long-term business objectives include:
- Achieve a profit of $ 1 million in 10 years.
- Building a 200+ team in the next 10 years
- Establishing a manufacturing unit for in-house production.
Now, regardless of whether you’ve been setting goals for years or are new to them, you must have heard about the concept of SMART goals. Let’s now elaborate on our understanding of the same.
How to set SMART goals?
SMART is an acronym for goal-setting that stands for Specific, Measurable, Achievable, Relevant, and Time-bound. The concept of SMART goals was developed by George Doran for corporates to set a more clear and defined goal.
Let’s delve into SMART more:
Specific
While setting your goals you should be very accurate and specific about what you want and how to accomplish it. Some of the examples to understand specific parameters of goals are:
- The revenue you want in a year/ or specific period
- Which department would drive that process
- What resources you will need
Measurable
Measurable goals measure progress toward your objective using metrics like dates and numbers, in short, you can measure business goals. It helps you to stay motivated about your business achievements process and also enables you to assess how your efforts are advancing your goals.
Achievable
Set practical goals to be achievable. Earning 1 million dollars in a day for a startup isn’t a realistic goal.
Relevant
All your goals should be business-specific and relevant to your field. A goal that matters to your company and meets its requirements is reasonable.
Time-bound
A deadline for the job you plan to complete is part of a time-bound goal. Without a deadline, it can be challenging to gauge your progress. Deadlines can motivate you to take action and facilitate effective goal-achieving.
How to set business goals?
Now that you know the importance of setting goals, then let’s see how to set business goals:
1. Be specific and don’t distract from your dream
“Sometime” and “I will complete it soon” will be your forever go-to quote if you don’t focus on all of your goals. “Till our 2nd anniversary, we want 25 employees on board with 500+ customers” is a predefined goal for your business.
2. Divide your goals
Make short-term goals to not get overwhelmed by long-term goals. For instance, if your goal is to earn $1 million in five years, then break it into yearly/quarterly/monthly goals.
Breaking long-term goals into short-term goals will keep your computations, financial aspects, and forecasting simple.
3. Take action towards goal achievement
Planning the steps you must take to accomplish your goals is the next stage of the process. Here are some concrete examples of actionable goals that could contribute to achieving this:
- To reach more clients; one should create a Facebook page
- Five times every week; publish on social media platforms
- Make a website to sell products online
- Provide new clients with a 10% discount
- Hire a salesperson
Break down the goals first and then take all the actions necessary to achieve your goals within or before the deadline.
4. Check-in frequently
Regularly evaluate your progress toward your goals to see if you need to make any modifications. When you first set them, you might have been a little too ambitious or not ambitious enough.
On the other hand, perhaps your goals are no longer as important as they once were. It’s necessary to re-evaluate and modify your goals whenever you choose.
5. Do the SWOT analysis
A high-level strategic planning analysis called SWOT will assist you in determining where your company needs to improve and where it’s currently succeeding. Strengths, Weaknesses, Opportunities, and Threats are the abbreviation for this phrase SWOT analysis.
Before attempting to define goals, conduct the analysis. This will assist you in considering your strategic problems and opportunities. Visit our blog to learn how to do the SWOT analysis.
6. Take employees suggestions
Finding out what employees think is a wise move. It’ll give your leadership team knowledge from individuals who are actually going to work on those goals.
If you solicit input, be prepared to act on it; otherwise, staff members won’t feel encouraged to share their thoughts in the future.
7. Build a goal-setting team
The size of your organization will determine who should take part in this discussion. Will mid-level employees be included or senior team leaders & managers will be included? How about the directors on your board? Ask yourself these questions and you will know whom to include and whom not to.
8. Do competitive and internal benchmarking
Compare your performance with the previous performances and also compare it amongst the competitors to know your position. Do the competition analysis properly to know your position in your field and internal in your business too.
This information will help you define company goals by highlighting your strengths and weaknesses. Also, it will help you understand where you are lacking in comparison to your competitors.
Benefits of goal setting
Let’s now understand the advantages and importance of setting goals:
- Setting goals gives your organization a specific direction to go.
- Goals guarantee that everyone aligns toward a common goal.
- Increases employee incentive to accomplish both short- and long-term goals.
- Cultivate a sense of accountability in employees.
- Instills clarity regarding what is and what isn’t necessary.
- Ensures all the activities are aligned towards the achievement of your business goals.
- Helps maintain future control.
- Offers clarity to decision-making.
- Increases productivity and customer satisfaction.
- Gives you a sense of satisfaction.
- Provides motivation when you hit a setback.
- Helps set business milestones and your business performance.
- Defining goals also helps you build an attractive business plan.
Conclusion
Setting goals helps you and your business move in the right manner. Without them, it’s challenging to gauge the success of your company.
While setting your goals ensure that they align with the long-term vision of your company. Set KPIs and benchmarks and consistently evaluate your performance to ensure the achievement of your goals.
Use the Upmetrics business planning app to create a business plan outlining your short-term goals and action plan. Communicate it effectively with your team and ensure its effective implementation.
