The SMART Way to Set Goals for Your Business
The purpose of goal-setting is so that you and your team can monitor progress and measure success. Goals provide you with a sense of direction and purpose.
Running a business without a set of clearly defined goals is like planning a long car journey without a roadmap. You take many wrong turns, lose your way, and can’t figure out how to reach your final destination.
So where do you start? SMART goals are the answer. These are goals that are specific, measurable, achievable, relevant and timely. An example of a SMART goal might be: “To achieve a profit growth of 20% in the European market in the next five years by cutting production costs and introducing three new product lines.”
Whether you want to set weekly, monthly, quarterly, annual, three-year or five-year goals use the SMART concept to get to exactly where you want to go.
Specific – don’t come up with a vague set of broad, ambiguous general statements. “We must increase our profitability” is a wonderful goal but it is far too vague to have any real meaning. How much do you want to increase your profitability by and when do you want to arrive at this figure? Your goals need to be concrete and detailed.
Measureable – set goals that can be tracked in numbers. “I want to be super rich and successful” is not a good goal because it cannot be measured. “I want to increase my revenue by $25,000 by this December” is an excellent goal. When a goal is measurable it can be divided into a number of specific steps and milestones that will allow you to track your progress, and modify things if required.
Achievable – your goals should stretch you, but they should also be realistic and within your abilities. If the average price of an order was $500 last year, don’t set a goal of increasing that figure to $5000 unless you are making sweeping and dramatic changes to your organisation. Be honest with yourself, consider the resources you have at your disposal, and set goals accordingly. You want to be ambitious enough to inspire you, but not so unrealistic that you set yourself up for failure.
Relevant – the goals you set should be relevant to the overall vision. To borrow the roadmap analogy, you need to get to your destination without expending energy going down the wrong highways.
Timely – setting a deadline allows you to keep things on track. Give yourself a reasonable timeframe for achieving your goals and break these down into short-term increments.
And don’t forget…
• Be sure to put your ideas down on paper; don’t just keep them in your head. The very act of recording your goals helps you to put flesh onto your ideas, and once they are complete provide you with a detailed roadmap to follow.
• Follow through and take action otherwise the goals are meaningless and worthless.
• Goal-setting is a fluid process. Continually review your goals to make sure they are relevant, and once they are achieved set new ones.
• Celebrate your wins, even the small ones. Patting yourself on the back for a job well done is recognition of all the effort that went into your achievement, and acts a powerful motivator to pursue and attain the next set of goals.
When you combine your passion for your business, with entrepreneurial know-how and goal –setting, you can create unstoppable and powerful force.