Setting your business goals

The New Year is the traditional time for making resolutions, where we solemnly resolve to take new habits on board. For many of us, these well intentioned decisions usually fall by the wayside within a matter of weeks, if not days. The secret to seeing your business resolutions through is to turn them into goals for the year.

You might be wondering what the difference between a resolution and a goal is. There is a fine distinction between the two. Resolutions often stop at being a mental decision to improve in one or two areas whereas real goals are committed to writing and become both tangible and measureable.

Some goal-setting pointers

Goals are important to give your business drive and direction. The adage, ‘If you don’t know where you are going, any road will get you there’ applies on both a personal and business level.  Setting (and monitoring) goals can be a powerful tool to strengthen or grow your business.

Personal and business goals

Personal and business goals need to be considered together. It would be silly, for example, to set a personal goal of taking more time off work at the same time that you plan to launch a new branch or product for your business. Your personal and business goals should not conflict with each other, and you’ll need the support and buy-in of your family, circle of close friends, top management and staff to help you achieve them.

Your goals should support your business plan

Your business goals should also align with and support your medium and long-term business plans and objectives. If your overarching business model is to provide specialist products to a niche market, you should think twice before you diversify your product range to appeal to a wider customer base. Your short-term goals need to support your long-term vision.

Communicating your goals

It is much harder to achieve your goals if you keep them to yourself. Your family and staff can’t support you or your goals if they don’t know what they are, and the pressure of having people occasionally ask how you’re progressing is often enough to spur you to keep tackling a project, even when you feel disillusioned and want to give up.

The secrets of goal setting

Write your goals down

One of the almost sure-fire ways to guarantee you’ll fail to achieve your goals is to have this vague idea of what you want to achieve in your head, and assume that this is all you need to do. To have a reasonable chance of achieving your goals, the first thing you need to do is to record them in writing.

Don’t write your goals on the back of a receipt write them neatly in your dairy, or print them out and pin them up on the office notice board. The more often you (and your staff) are reminded of the goals, the more likely you are to achieve them.

Plan the steps you’ll need to follow in detail

Once you have committed your goal to paper, you need to define exactly what you want to achieve and by when. Unless you have a really simple goal, you’ll probably need to break your goal down into steps and plan how you will achieve each step and the timeframe you’d need to complete each step by. This will quickly identify whether your goals are realistic and achievable, or whether you’ll need to adjust your goal to suit your circumstances.

Breaking bigger goals down into smaller steps will make the task seem less daunting and more achievable. Once you see some progress toward the larger goal, you’ll become more confident about succeeding – remember nothing breeds success, like success.

Setting SMART goals

This might sound like a cop out, but the secret to setting goals and achieving them lies in the goals you choose to set for yourself. This doesn’t mean that the way to achieve your goals is to set easy goals. It means that you need to set SMART goals – ones that are Specific, Measurable, Attainable, Realistic, and Time-bound.

Specific: The goals you set need to be specific. A goal to increase turnover in your business is not specific. You haven’t defined it enough to know when you’ve achieved your goal, or not. Have you reached your goal if turnover rises by 2% or by $10,000, or only when it increases by 10% or $100,000?

Setting specific and clear goals is an important component of setting goals. Simply put: you’re more likely to achieve them if you have a clear target to aim at.

Measureable: You need a goal that can be measured in order to gauge your progress. If you’ve given yourself a year to increase turnover by 10%, you have a measurable goal. You can work out how much extra revenue you’ll need to generate each month, and you can monitor your progress on a monthly basis. If you see that you are falling behind, you can try other methods to achieve your target.

The ability to measure and, therefore, monitor your progress plays an important role in motivating you to keep trying. It also lets you know that what you are doing is working or needs to be changed. Without this feedback, you can lose the motivation to keep working toward your goal.

Attainable: It seems a bit like stating the obvious to say that your goals must be attainable, but when people start dreaming about the future and planning what they’d like, they sometimes lose touch with reality. Setting a goal to increase turnover by 100% year-on-year for the next 10 years is probably not attainable, unless you have stumbled upon a unique, winning business combination.

The problem with setting goals that you have very little chance of achieving is that you become disillusioned and stop trying. It would be better to have a goal of increasing turnover by 10% year-on-year for the next 10 years, and to see it as a bonus if you exceed your goal, rather than to aim at that elusive 100% and then give up altogether after six months.

Realistic: You should set goals that you have a reasonably good chance of achieving. The goal of increasing turnover by 10% year-on-year might be attainable in a generalised sense, but if you have no training in sales or are operating in a saturated market, this might not be a realistic goal for you and your business circumstances. You might aim at a smaller percentage for the first few years while you attend a sales course, or while you diversify your range to appeal to a broader customer base.

Time-bound: Your goals should be time-bound or have a time-based component. Using the goal to increase turnover by 10% as an example, you would need to set a time frame by when you wanted to achieve this. Do you want to see this 10% increase in two months, six months, nine months or longer?

All the components of a SMART goal work together to help define your goal into a clear target to aim for within a specified time period. This allows you to monitor your progress, which in turn either boosts your morale or allows you to change your game plan to achieve your goal.

Some goal-setting tips

Choosing the right goals

Sometimes coming up with goals that appeal or inspire you can be a problem. There’s little point in setting goals like setting up your business so that you have more free time, if you prefer to live and breathe your business. However, if taking a month off each year for travel appeals to you, the goal to set up your business in such a way that you can do this will be met with motivation. Conversely, if you have a new family, you might be motivated by having more free time.

You’ll need to bear your personal goals in mind when you set your business goals. You’ll need an idea of how many hours a week you’d like to work, how much money you’d need to achieve your goals, how much travelling you want or are prepared to do, and how you personally measure success.

Getting motivated

Once you’ve set your goals, find ways to keep yourself motivated. Some things you can do are:

  • Put your goals where you will see them often.
  • Get an image that represents the outcome of your goal and pin it on your mirror or in a few places to remind you. If the hypothetical 10% increase in turnover will allow you to take your dream holiday, then pictures of that island paradise can inspire you to work harder. If the 10% increase will pay for an additional staff member to give you more free time with your family, a family picture will help to keep that goal top-of-mind and keep you motivated throughout the day.

Next steps

  • Identify suitable business goals that are compatible with your personal goals and long-term business plan.
  • Write your goals down and refine them.
  • Develop SMART goals and detail how you plan to achieve them. Use the BNZ goal setting template to record them.
  • Communicate your goals to staff and family alike and find ways to motivate yourself and others to achieve your goals. Read the BNZ article about Motivating employees.
  • Listen to the BNZ podcast about Mapping your business future.

Content provided by The Small Business Company