Moving forward in business is like planning a great trip: You know where you want to end up, but the road there isn’t always straightforward.
Smart business goals help you navigate the twists and turns along the way. While a business plan and vision statement offer a “big picture” perspective about your company and what you want to accomplish, short-term and long-term goals define the specific strategies you’ll use to get there.
However, not all business goals are created equal. In order to be effective, goals must involve specific, actionable items with a clear time frame and responsible parties.
Here are five examples of smart goals for small business owners and how you can set them.
Financial goals help you focus on driving more revenue, cutting costs to raise profitability and sustain cash flow, and setting new financial targets for future growth.
To create and accomplish financial goals, you have to collaborate with different departments. Each department can help to identify strategies that trim costs, such as supplies or facility expenses. Your team’s expertise may also extend to implementing ideas that accomplish revenue and profitability goals.
When developing financial goals, project the total increase in profits over a long period like a year. Then break that amount down into quarterly financial targets. Make financial goals as specific as possible — for example, “increase production by x percent over three months.”
To develop growth goals, you need a clear vision statement that you can segment into achievable steps. Whether it’s reaching new markets, launching new products, increasing your customer base, or raising brand recognition, it’s important to establish a realistic number of goals, actionable tasks, and a team to complete those growth goals.
Start with a market analysis to ensure the approach makes sense. As you implement growth goals, you may need to change their priority or adapt them so you aren’t counteracting other business goals.
For example, growing a customer base may involve promotions that don’t necessarily improve your bottom line at the start. So you’ll need to make assessments along the way to gauge if and when you’ll achieve the financial goal connected to this growth goal.
Improving relationships with your target audience doesn’t just solve problems for individual customers. Enhanced customer service also helps your company develop respect among all stakeholders, which promotes additional business growth.
To set goals for customers, identify roadblocks that inhibit exceptional customer experiences. Roadblocks might include a complicated phone menu, significant response lag, or slow checkout time.
With these roadblocks in mind, develop customer goals to solve them, such as
- Simplify call-in customer support options
- Add other customer support channels like an online help desk or a chat option
- Streamline the online/in-store checkout process with new technology
Employee development goals
Motivated, engaged employees offer many benefits for a company, such as increased productivity, deeper loyalty, and more creativity. This talent is an essential ingredient in a company’s recipe for success. That’s why it’s critical to design and execute goals that help employees develop skills and knowledge as well as challenge them enough to stay interested in their work.
To set employee development goals, collect regular feedback from team members about the types of incentives they want. Include these goals in performance reviews by aligning development actions like training and ongoing learning opportunities with business objectives like increasing engagement or converting new customers.
As your business grows, you’ll establish a place in the community you serve. To nurture this position, develop philanthropy and social programs that benefit local and global communities.
Not only does this feel good, but it also boosts your reputation as a socially conscious company. In addition, these social goals prove to the team that the company isn’t just about making money. Instead, it seeks to do good for everyone.
Your social goals don’t have to be financial. In-kind donations of products, services, or your thought leadership often make more of a positive impression than charitable donations. For example, if your small business isn’t yet in the position to donate a certain percentage of the profits from each sale, you can focus on having the team volunteer for a community project or donate products to those in need.
Specific and visible business goals
Studies show people are more likely to accomplish goals that are specific, challenging, and written down.
When creating the types of business goals detailed above, focus on adding a quantitative measure, where relevant, in terms of percentage of improvement or resource savings, growth or productivity improvements, or a deadline to achieve the goal. Also, keeping goals visible helps employees stay focused on business success. They have a way to benchmark their progress. And seeing what’s been achieved can be a prime motivator to continue working toward achieving your goals and tackling new ones in the future.