There is saying by Yogi Berra, famous baseball legend, “If you don’t know where you’re going, you’ll end up somewhere else”. This is so true in life and in business. And no business owner wants to end up in the “Cemetery of Failed Businesses” (Alan Hall, Forbes). Personally, I’ve started businesses without goals and planning and with goals and planning. Which do you think was more successful? But it’s not too late if you never thought about your goals for your business. Or if you never developed a plan to reach your goals. So let’s start now. Here some suggestions that you might find useful.
- Talk to Your Customers
You most likely have a relationship with your customers already, and if you don’t now’s a great time to start one. Your customers will likely be willing to tell you what they like, don’t like, and what they want to see in the future. This is also a good time to discuss innovations, technology, products, services, pricing, delivery, warrantees, and customer experience with your customers. Communication is a great tool to obtain information to help shape your goals for your business.
- Define Your Goals Using Specific Details
Once you’ve brainstormed what is important to you, what you value, and what your priorities are personally and for your business, make notes on which things motivate you the most. Then develop these ideas and thoughts into goals. One of the most effective methods to develop goals is to use the “SMART” system.
SMART system is defined as:
Specific: use clear, concise, and exact terminology to describe each goal. The more specific the better. Define who, what, when, where, why, and how for each goal.
Measurable: define exact, tangible criteria that can be measured for each goal. You will need to be able to measure your progress effectively, so the better you define the conditions that describe success, the easier it know that you have succeeded each step of the way.
Attainable: you will want to breakdown the goal into smaller steps to that are easier to accomplish and measure for completion. It’s a good idea to make sure you word each step in the process of goal attainment in a positive manner to encourage motivation.
Realistic: your goals and steps need to be realistic. In other words, make sure the goal and each step is something that you can actually accomplish. For example, if you set a goal of increasing your sales by 50% in 3 years, you can realistically take steps to reach this goal. However, if you set a goal of selling your company for $10 million and retiring in 6 months, even if you plan carefully, this is an unrealistic goal (unless you can invent an amazing technology that just happens to fulfill an immediate need in society and creates disruptive change).
Timely: you want to assign a time line to your goal that is not only a reasonable and attainable timeframe, but also one that pushes you a bit to create a sense of urgency so you don’t get complacent and unmotivated.
It’s also good to split your goals into strategic and financial goals. Sometimes these may overlap, but start out by separating them. Strategic goals are related to your markets, customers, competitors, products, services, employees, resources, and processes. Financial goals are related to your revenues, margins, expenses, profits, and industry financial ratios.
- Include Your Employees, Partners, and Managers
I highly recommend that you involve your employees, partners, and managers in goal development. You can start them off with your vision for the company and some ideas for direction, and then let them be involved in determining the company’s goals and the steps to reach those goals. Including your people will also develop a sense of ownership and accountability which will help you and your employees, partners, and managers communicate expectations and assignments to reach the goals.
- Develop Both Long- and Short-term Goals
It’s best to determine your long-term (5-10 years) goals first. Then, with these long-term goals as a framework, develop your medium- and short-term goals (3-5 years and 1-3 years, respectively). Use your short-term goals to develop your plan of attack for prioritizing and accomplishing each of your goals.
- Develop a Plan “B”
It’s always best to have a contingency plan. This means that you have a backup plan in case things happen that are out of your control, such as a downturn in the economy, or a natural disaster, or an unexpected illness. Sometimes you can plan for certain “unexpected” occurrences. For example, in Hawaii, it’s always good to plan for the “unexpected” tidal wave or hurricane by making sure you have insurance, provisions, and a backup generator among other things. This is true for your business as well. You want to plan for an “unexpected” event such as a new technology that makes your product obsolete, and brings an unexpected drop in sales.
- Be the EDITOR© of Your Plan
As we describe in our video and website, use our EDITOR system to evaluate, develop, implement, test, observe, and repeat to assist you in your goal creation and completion. It’s a straightforward method to evaluate the state of your business, and where you want it to be, develop yours goals and your plans to achieve those goals, and follow through in completing your goals by implementing your plan, testing it, observing and measuring your results, and repeating and reassessing.
Mahalo and much success,
Bos, P. V. (2010, June 29). How to Set Business Goals. Retrieved from Inc.: http://www.inc.com/guides/2010/06/setting-business-goals.html
Creating SMART Goals. (2015). Retrieved from TopAchievement: http://topachievement.com/smart.html
Hall, A. (2012, December 8). 6 Steps to Insanely Successful Business Goals for 2013. Retrieved from Forbes: http://www.forbes.com/sites/alanhall/2012/12/08/6-steps-to-insanely-successful-business-goals-for-2013/
How to Set Realistic Goals. (2015). Retrieved from WikiHow: http://www.wikihow.com/Set-Realistic-Goals
The Mind Tools Editorial Team. (2015). Golden Rules of Goal Setting. Retrieved from MindTools: https://www.mindtools.com/pages/article/newHTE_90.htm