The 7 Secrets to Setting Effective Goals for Your Business

As we approach the 4th quarter, it seems that many businesses are starting to think about goals for the upcoming year. Many small businesses struggle with what their goals should be, how to create them, how to write them, and, most importantly, how to share the goals with employees in a meaningful way.

 

When did goal setting get so complicated?

 

I have asked many business owners what’s stopping them from writing down their goals for the next year. It has surprised me to learn that many of them are concerned about “doing it wrong.”

 

If you haven’t heard it somewhere else before, let me be the first to tell you that there is no “wrong” way to create business goals. However, there are some helpful ideas to make the goals more meaningful and more measurable – which increases the likelihood of buy-in from everyone involved in your company.

 

Here are 7 steps:

 

Keep It Simple – I recently asked one of my clients to make a list of their goals for next year; I received back a 4 page single-spaced essay. When creating your goals, it’s important to make an actual list so that everyone involved can know what they are, understand the goals, and feel that they have a way to contribute to the goal. You should be able to list all of your goals on one page.

 

Stretch yourself (just a little bit) – Goals are fun, challenging and rewarding when we push ourselves a little bit outside of our comfort zone. Setting goals that are “gimmes” creates an environment where status quo is ok and mediocrity is acceptable. If you know that your organization can achieve a certain amount in sales with “no problem” then perhaps your goal should be 10% higher.

 

Make it measurable – Years ago, I had a very wise mentor tell me, “What gets measured, gets done.” Each and every goal on your list should have some way for you to determine whether it has been completed successfully or not. Goals such as “Increase Sales” have no value. The goal should be more specific, such as “Increase Gross Sales by 10% over the 2014 result”. Even better would be “Gross Sales of $1.5 million in 2015”.

 

Give it meaning – life is challenging, business is challenging, and having a balance between the two is an enormous undertaking. Goals aren’t only about making money; they need to have meaning to every person who contributes to your company’s success. People need to understand the “why” of what they are being asked to do. There’s got to be more to it than just lining the pockets of the owners. Think about it: What’s the meaning of your company? What do you want to contribute to society? How can those who impact the company’s success feel a part of something that’s bigger than themselves? Consider goals that are not directly related to the bottom line.

 

Communicate the goals – I can remember a time when large organizations would hire consulting companies to help them develop their business plan. Massive binders of documentation, analytics, ideas, guidelines, procedures, etc. were created and then put on the shelf to collect dust. All the executives would feel good about the process and then return to business as usual. In today’s world, businesses do not function that way (at least not the ones that intend to grow). It’s absolutely critical that you share the goals with EVERY employee and anyone else who can impact your success. Call a meeting, go out to lunch, deliver ice cream to the office – find some way to get everyone together. Give everyone the one page goal document and then explain the thought process and objective of each goal. Allow for questions and discussion – this will help everyone to buy into the goals and make them their own. They may even have ideas on how to achieve the goals more efficiently, so be ready to listen.

 

Update your team regularly – part of measuring is to keep track of how you are doing throughout the year and share that information. If you set an annual sales goal, communicate with everyone on a regular basis how the company is doing toward achieving the goal. When the leadership lets people know the goals are important through on-going communications, everyone will be reminded to stay focused.

 

Modify (if necessary) – Sometimes, the unexpected happens. That’s life. Even if your business does all of the above, there’s still a chance that your office might burn down. When something dramatically changes during the course of the year that can impact your goals, it’s ok to change them. Just don’t forget to communicate the changes. It doesn’t have to be a negative change, either. If you land a huge contract that you did not anticipate which causes additional hiring beyond the original goals, that’s great! It’s ok to change goals as long as doing so is because of real factors impacting your ability to achieve the goal.

 

Don’t make goal setting a burden. Take the time to imagine what you want your business to look like a year from now. Write down what it would take to get from where you are today to what you envision. These are your goals. Another great way to get and share ideas for goals is to ask for input from your advisors, vendors, employees, etc.

 

As always, open communication is the key. Goals should not exist in a vacuum; everyone needs to know and understand what the goals are, why they are meaningful and how they can contribute.

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